Document:

EX-4.1

  

SABINE PASS LIQUEFACTION, LLC 

AND EACH GUARANTOR THAT MAY BECOME PARTY HERETO 
  

 
 INDENTURE 

Dated as of February 24, 2017 
  

 
 The Bank of New
York Mellon 
 Trustee 
  

 

 TABLE OF CONTENTS 
  

							
	 ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE
	  	 	1	 
			
	 Section 1.01
	 	 Definitions
	  	 	1	 
	 Section 1.02
	 	 Other Definitions
	  	 	55	 
	 Section 1.03
	 	 [Reserved.]
	  	 	55	 
	 Section 1.04
	 	 Rules of Construction
	  	 	55	 
		
	 ARTICLE 2 THE NOTES
	  	 	56	 
			
	 Section 2.01
	 	 Form and Dating
	  	 	56	 
	 Section 2.02
	 	 Interest and Principal on the Notes
	  	 	56	 
	 Section 2.03
	 	 Adjustment to Payment Schedule
	  	 	57	 
	 Section 2.04
	 	 Execution and Authentication
	  	 	57	 
	 Section 2.05
	 	 Registrar and Paying Agent; Depositary
	  	 	58	 
	 Section 2.06
	 	 Paying Agent to Hold Money in Trust
	  	 	58	 
	 Section 2.07
	 	 Holder Lists
	  	 	58	 
	 Section 2.08
	 	 Replacement Notes
	  	 	59	 
	 Section 2.09
	 	 Outstanding Notes
	  	 	59	 
	 Section 2.10
	 	 Treasury Notes
	  	 	59	 
	 Section 2.11
	 	 Temporary Notes
	  	 	60	 
	 Section 2.12
	 	 Cancellation
	  	 	60	 
	 Section 2.13
	 	 Defaulted Interest
	  	 	60	 
		
	 ARTICLE 3 REDEMPTION AND OFFERS TO PURCHASE NOTES
	  	 	61	 
			
	 Section 3.01
	 	 Notices to Trustee
	  	 	61	 
	 Section 3.02
	 	 Selection of Notes to Be Redeemed
	  	 	61	 
	 Section 3.03
	 	 Notice of Redemption
	  	 	62	 
	 Section 3.04
	 	 Effect of Notice of Redemption
	  	 	63	 
	 Section 3.05
	 	 Deposit of Redemption or Purchase Price
	  	 	63	 
	 Section 3.06
	 	 Notes Redeemed in Part
	  	 	63	 
	 Section 3.07
	 	 Optional Redemption
	  	 	63	 
	 Section 3.08
	 	 Open Market Purchases; No Mandatory Redemption or Sinking Fund
	  	 	65	 
	 Section 3.09
	 	 Offer to Purchase by Application of Excess Proceeds or Excess Loss Proceeds
	  	 	65	 
	 Section 3.10
	 	 Allocation of Partial Prepayments
	  	 	68	 
		
	 ARTICLE 4 COVENANTS
	  	 	68	 
			
	 Section 4.01
	 	 Payment of Notes
	  	 	68	 
	 Section 4.02
	 	 Maintenance of Office or Agency
	  	 	69	 

  
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	 Section 4.03
	 	 Information About the Company
	  	 	69	 
	 Section 4.04
	 	 Compliance Certificates
	  	 	72	 
	 Section 4.05
	 	 Taxes
	  	 	72	 
	 Section 4.06
	 	 Restricted Payments
	  	 	73	 
	 Section 4.07
	 	 Dividend and Other Payment Restrictions Affecting Subsidiaries
	  	 	74	 
	 Section 4.08
	 	 Incurrence of Indebtedness and Issuance of Preferred Stock
	  	 	75	 
	 Section 4.09
	 	 Asset Sales
	  	 	80	 
	 Section 4.10
	 	 Liens
	  	 	82	 
	 Section 4.11
	 	 Business Activities
	  	 	82	 
	 Section 4.12
	 	 Maintenance of Existence
	  	 	82	 
	 Section 4.13
	 	 Offer to Repurchase Upon Change of Control
	  	 	82	 
	 Section 4.14
	 	 Events of Loss
	  	 	84	 
	 Section 4.15
	 	 Access
	  	 	85	 
	 Section 4.16
	 	 Insurance
	  	 	86	 
	 Section 4.17
	 	 Compliance with Law
	  	 	86	 
	 Section 4.18
	 	 Use of Proceeds of Secured Debt
	  	 	86	 
	 Section 4.19
	 	 Project Document Termination Payments
	  	 	86	 
	 Section 4.20
	 	 LNG Sales Contracts
	  	 	87	 
	 Section 4.21
	 	 Project Documents
	  	 	87	 
	 Section 4.22
	 	 Project Construction; Maintenance of Properties
	  	 	88	 
	 Section 4.23
	 	 Maintenance of Liens
	  	 	88	 
	 Section 4.24
	 	 Credit Rating Agencies
	  	 	88	 
	 Section 4.25
	 	 Additional Note Guarantees
	  	 	88	 
	 Section 4.26
	 	 Separateness
	  	 	89	 
	 Section 4.27
	 	 Payments for Consent
	  	 	89	 
	 Section 4.28
	 	 Books and Records
	  	 	89	 
	 Section 4.29
	 	 Economic Sanctions, Etc.
	  	 	89	 
	 Section 4.30
	 	 Changes in Covenants when Notes No Longer Rated Investment Grade
	  	 	90	 
		
	 ARTICLE 5 SUCCESSORS
	  	 	93	 
			
	 Section 5.01
	 	 Merger, Consolidation, or Sale of Assets
	  	 	93	 
	 Section 5.02
	 	 Successor Corporation Substituted
	  	 	94	 
		
	 ARTICLE 6 DEFAULTS AND REMEDIES
	  	 	95	 
			
	 Section 6.01
	 	 Events of Default
	  	 	95	 
	 Section 6.02
	 	 Acceleration
	  	 	101	 
	 Section 6.03
	 	 Other Remedies
	  	 	101	 
	 Section 6.04
	 	 Waiver of Past Defaults
	  	 	101	 
	 Section 6.05
	 	 Control by Majority
	  	 	102	 
	 Section 6.06
	 	 Limitation on Suits
	  	 	102	 
	 Section 6.07
	 	 Rights of Holders of Notes to Receive Payment
	  	 	103	 

  
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	 Section 6.08
	 	 Collection Suit by Trustee
	  	 	103	 
	 Section 6.09
	 	 Trustee May File Proofs of Claim
	  	 	103	 
	 Section 6.10
	 	 Priorities
	  	 	104	 
	 Section 6.11
	 	 Undertaking for Costs
	  	 	104	 
		
	 ARTICLE 7 TRUSTEE
	  	 	104	 
			
	 Section 7.01
	 	 Duties of Trustee
	  	 	104	 
	 Section 7.02
	 	 Rights of Trustee
	  	 	105	 
	 Section 7.03
	 	 Individual Rights of Trustee
	  	 	107	 
	 Section 7.04
	 	 Trustee’s Disclaimer
	  	 	107	 
	 Section 7.05
	 	 Notice of Defaults
	  	 	108	 
	 Section 7.06
	 	 [Reserved.]
	  	 	108	 
	 Section 7.07
	 	 Compensation and Indemnity
	  	 	108	 
	 Section 7.08
	 	 Replacement of Trustee
	  	 	109	 
	 Section 7.09
	 	 Successor Trustee by Merger, etc.
	  	 	110	 
	 Section 7.10
	 	 Eligibility; Disqualification
	  	 	111	 
	 Section 7.11
	 	 Authorization to Enter Into Accession Agreement
	  	 	111	 
	 Section 7.12
	 	 Trustee Protective Provisions
	  	 	111	 
	 Section 7.13
	 	 Tax Withholding
	  	 	111	 
		
	 ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE
	  	 	111	 
			
	 Section 8.01
	 	 Option to Effect Legal Defeasance or Covenant Defeasance
	  	 	111	 
	 Section 8.02
	 	 Legal Defeasance and Discharge
	  	 	111	 
	 Section 8.03
	 	 Covenant Defeasance
	  	 	112	 
	 Section 8.04
	 	 Conditions to Legal or Covenant Defeasance
	  	 	113	 
	 Section 8.05
	 	 Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous
Provisions
	  	 	114	 
	 Section 8.06
	 	 Repayment to Company
	  	 	115	 
	 Section 8.07
	 	 Reinstatement
	  	 	115	 
		
	 ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER
	  	 	116	 
			
	 Section 9.01
	 	 Without Consent of Holders of Notes
	  	 	116	 
	 Section 9.02
	 	 With Consent of Holders of Notes
	  	 	116	 
	 Section 9.03
	 	 Decisions under Other Financing Documents
	  	 	118	 
	 Section 9.04
	 	 Revocation and Effect of Consents
	  	 	121	 
	 Section 9.05
	 	 Notation on or Exchange of Notes
	  	 	122	 
	 Section 9.06
	 	 Trustee to Sign Amendments, etc.
	  	 	122	 
		
	 ARTICLE 10 COLLATERAL AND SECURITY
	  	 	122	 
			
	 Section 10.01
	 	 Security
	  	 	122	 
	 Section 10.02
	 	 Security Documents
	  	 	123	 

  
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	 Section 10.03
	 	 Collateral
	  	 	123	 
	 Section 10.04
	 	 Release of Security Interests
	  	 	123	 
	 Section 10.05
	 	 Release of Collateral
	  	 	124	 
	 Section 10.06
	 	 Certificates of the Trustee
	  	 	124	 
	 Section 10.07
	 	 Termination of Security Interest
	  	 	124	 
		
	 ARTICLE 11 NOTE GUARANTEES
	  	 	125	 
			
	 Section 11.01
	 	 Guarantee
	  	 	125	 
	 Section 11.02
	 	 Limitation on Guarantor Liability
	  	 	126	 
	 Section 11.03
	 	 Execution and Delivery of Note Guarantee Notation
	  	 	126	 
	 Section 11.04
	 	 Guarantors May Consolidate, etc., on Certain Terms
	  	 	127	 
	 Section 11.05
	 	 Releases
	  	 	128	 
		
	 ARTICLE 12 SATISFACTION AND DISCHARGE
	  	 	129	 
			
	 Section 12.01
	 	 Satisfaction and Discharge
	  	 	129	 
	 Section 12.02
	 	 Application of Trust Money
	  	 	130	 
		
	 ARTICLE 13 MISCELLANEOUS
	  	 	131	 
			
	 Section 13.01
	 	 Notices
	  	 	131	 
	 Section 13.02
	 	 Certificate and Opinion as to Conditions Precedent
	  	 	132	 
	 Section 13.03
	 	 Statements Required in Certificate or Opinion
	  	 	133	 
	 Section 13.04
	 	 Rules by Trustee and Agents
	  	 	133	 
	 Section 13.05
	 	 No Personal Liability of Directors, Officers, Employees and Stockholders
	  	 	133	 
	 Section 13.06
	 	 Governing Law; Waiver of Jury Trial; Jurisdiction
	  	 	133	 
	 Section 13.07
	 	 No Adverse Interpretation of Other Agreements
	  	 	134	 
	 Section 13.08
	 	 Successors
	  	 	134	 
	 Section 13.09
	 	 Severability
	  	 	135	 
	 Section 13.10
	 	 Counterpart Originals
	  	 	135	 
	 Section 13.11
	 	 Trustee’s Receipt of Funds to the Extent not Required to be Applied to Payment of the
Notes
	  	 	135	 
	 Section 13.12
	 	 Table of Contents, Headings, etc.
	  	 	135	 

 EXHIBITS 
  

			
	 Appendix A
	  	 PROVISIONS RELATING TO INITIAL NOTES AND ADDITIONAL NOTES

	 Appendix B
	  	 PAYMENT SCHEDULE

	 Exhibit A-1
	  	 FORM OF NOTE

	 Exhibit A-2
	  	 FORM OF REGULATION S TEMPORARY GLOBAL NOTE

	 Exhibit B
	  	 FORM OF CERTIFICATE OF TRANSFER

	 Exhibit C
	  	 FORM OF CERTIFICATE OF EXCHANGE

	 Exhibit D
	  	 FORM OF NOTATION OF GUARANTEE

	 Exhibit E
	  	 FORM OF SUPPLEMENTAL INDENTURE

	 Exhibit F
	  	 ADDITIONAL NOTES AND SUPPLEMENTAL INDENTURES FOR ADDITIONAL NOTES

	 Exhibit G
	  	 FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

  
 iv 

 INDENTURE dated as of February 24, 2017 among Sabine Pass Liquefaction, LLC, a Delaware
limited liability company, any Guarantors (as defined herein) that may become a party hereto from time to time, and The Bank of New York Mellon, as Trustee. 

The Company and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders (as defined
herein) of Notes (as defined herein). 
 ARTICLE 1 

DEFINITIONS AND INCORPORATION 
 BY
REFERENCE 
 Section 1.01    Definitions. 

“2013 Indenture” means the indenture, dated as of February 1, 2013, between the Company and The Bank of New York Mellon,
as Trustee, as supplemented by the First Supplemental Indenture, dated as of April 16, 2013, the Second Supplemental Indenture, dated as of April 16, 2013, the Third Supplemental Indenture, dated as of November 25, 2013, the Fourth
Supplemental Indenture, dated as of May 20, 2014, the Fifth Supplemental Indenture, dated as of May 20, 2014, the Sixth Supplemental Indenture, dated as of March 3, 2015, the Seventh Supplemental Indenture, dated as of June 14,
2016, the Eighth Supplemental Indenture, dated as of September 19, 2016 and the Ninth Supplemental Indenture, dated as of September 23, 2016. 

“Acceptable Rating Agency” means S&P, Fitch, Moody’s, or any other “nationally recognized statistical rating
organization” registered with the U.S. Securities and Exchange Commission, including any successor to S&P, Fitch or Moody’s. 

“Account” has the meaning given to such term in the Accounts Agreement. 

“Accounts Agreement” means the Second Amended and Restated Accounts Agreement, dated as of June 30, 2015, among the
Company, the Common Security Trustee and the Accounts Bank, as amended from time to time. 
 “Accounts Bank” means Compass
Bank, d.b.a. BBVA Compass, or any successor to it appointed pursuant to the terms of the Accounts Agreement. 
 “Accounts Bank Fee
Letter” means the Fee Letter, dated as of July 31, 2012, between the Company and the Accounts Bank. 
 “Additional
Debt Service Reserve Account” means any Additional Debt Service Reserve Account so designated, established and created by the Accounts Bank, as directed by the Company pursuant to the Accounts Agreement, upon the incurrence of any Secured
Replacement Debt or Secured Expansion Debt that provides for a “debt service reserve requirement.” 

 “Additional Material Project Document” means any contract, agreement, letter
agreement or other instrument to which the Company becomes a party after the Initial Senior Secured Debt Closing Date that: 
 (a) replaces
or substitutes for an existing Material Project Document; or 
 (b) (i) contains obligations and liabilities that are in excess of
$250,000,000 over its term (including after taking into account all amendments, amendments and restatements, supplements, or waivers to any such contract, agreement, letter agreement or other instrument) and (ii) is for a term that is greater
than two years; 
 provided, that for the purposes of this definition, any series of related transactions shall be considered as one transaction, and
all contracts, agreements, letter agreements or other instruments in respect of such transactions shall be considered as one contract, agreement, letter agreement or other instrument, as applicable. 

“Additional Notes” means Notes (other than the Initial Notes) issued under this Indenture in accordance with Section
2.1(d) of Appendix A and Exhibit F. 
 “Additional Secured Debt” means any of (a) the Secured Train
6 Debt, (b) the Secured Replacement Debt, (c) the Secured Working Capital Debt and (d) the Secured PDE Debt. 

“Administrative Decisions” has the meaning given to such term in the Intercreditor Agreement. 

“Advance” means a borrowing of a loan, issuance of or drawing upon a letter of credit or the issuance of debt securities
pursuant to any Secured Debt Instrument. 
 “Affiliate” means, with respect to any Person, another Person that directly or
indirectly Controls, or is under common Control with, or is Controlled by, such Person and, if such Person is an individual, any member of the immediate family (including parents, spouse, children and siblings) of such individual and any trust whose
principal beneficiary is such individual or one or more members of such immediate family and any Person who is Controlled by any such member or trust. Notwithstanding the foregoing, the definition of “Affiliate” shall not encompass
(a) any individual solely by reason of his or her being a director, officer or employee of any Person and (b) the Term Loan A Administrative Agent, the Common Security Trustee, the Trustee or any Secured Debt Holder. 

“Agent” means any Registrar, co-registrar, Paying Agent or additional paying agent.

 “Aggregate Other Secured Debt” means, at any time, the aggregate amount of Other Secured Debt. 

“Aggregate Secured Bank Debt” means, at any time, the aggregate amount of (i) the Secured Bank Debt and
(ii) without duplication, any Additional Secured Debt (other than any 

  
 2 

 
Additional Secured Debt that is either (x) Other Secured Debt or (y) loans made primarily by institutional investors, term loan B loans or any other loans made pursuant to one or more
credit facilities in which the lenders are not primarily financial institutions engaged in the business of banking). 
 “Aggregate
Secured Debt” means, at any time, the aggregate amount of Secured Debt. 
 “Aggregate Secured ECA Debt” means, at
any time, the aggregate amount of the Secured ECA Debt. 
 “Applicable Facility LNG Sale and Purchase Agreement” means any
Facility LNG Sale and Purchase Agreement (other than (A) any terminated Facility LNG Sale and Purchase Agreement, (B) any Facility LNG Sale and Purchase Agreement in relation to which a Bankruptcy has occurred in respect of the
counterparty thereof, (C) any Facility LNG Sale and Purchase Agreement not then in effect and (D) any Facility LNG Sale and Purchase Agreement in material payment default or a breach that has resulted in a material non-payment by the counterparty to such Facility LNG Sale and Purchase Agreement) with respect to any Train (a) for which the Company shall have delivered to the Trustee a certificate of an Authorized Officer
of the Company certifying that the In-Service Date has occurred or (b) (i) for which the Company shall have delivered to the Trustee a certificate of an Authorized Officer of the Company certifying
that such Train is under construction pursuant to a validly issued full notice to proceed under an EPC Contract not in material default and (ii) for which the Company shall have delivered to the Trustee a certificate from the Independent
Engineer certifying that the Indebtedness incurred in respect thereof, together with any equity contribution amount required by such Indebtedness and all Contracted Cash Flows, are sufficient to fund the entirety of the Project Costs of such Train
through the Guaranteed Substantial Completion Date thereof, plus reasonable contingencies. As of the date of this Indenture, the Train One and Train Two LNG Sales Agreements, the Train Three and Train LNG Four Sales Agreements and the Train 5 LNG
Sales Agreement are Applicable Facility LNG Sale and Purchase Agreements. 
 “Applicable Law” means, except as the context
may otherwise require, all applicable laws (including common law), rules, regulations, ordinances, judgments, decrees, injunctions, writs and orders of any Government Authority. 

“Applicable Procedures” means, with respect to any transfer or exchange of or for beneficial interests in any Global Note,
the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer or exchange. 
 “Asset
Sale” means: 
 (a) the sale, lease, conveyance or other disposition of any assets or rights; provided that the sale, lease,
conveyance or other disposition of all or substantially all of the assets of the Company and its Restricted Subsidiaries taken as a whole will be governed by the provisions of Sections 4.13 and 5.01, and not by the provisions of
Section 4.09; and 

  
 3 

 (b) the issuance of Equity Interests in any of the Company’s Restricted Subsidiaries or the
sale of Equity Interests in any of its Subsidiaries. 
 Notwithstanding the preceding, none of the following items will be deemed to be an
Asset Sale: 
 (1) any single transaction or series of related transactions that involves assets having a Fair Market Value
of less than $50,000,000; 
 (2) a transfer of assets between or among the Company and any of its Restricted Subsidiaries;

 (3) an issuance of Equity Interests by a Restricted Subsidiary of the Company to the Company or to any Restricted
Subsidiary of the Company; 
 (4) the sale, lease or other disposition of (A) products, services, inventory or accounts
receivable in the ordinary course of business or (B) equipment or other assets pursuant to a program for the maintenance or upgrading of such equipment or assets and the disposition of obsolete equipment, equipment that is damaged or worn out
or assets no longer needed in the business of the Company; 
 (5) the sale or other disposition of cash or Cash Equivalents;

 (6) settlement, release, waiver or surrender of contract, tort or other claims in the ordinary course of business or a
grant of a Lien not prohibited by this Indenture; 
 (7) a Restricted Payment that does not violate
Section 4.06 or a Permitted Investment; 
 (8) the sale or other disposition of LNG (or other
commercial products); 
 (9) sales, transfers or other dispositions of Permitted Investments; 

(10) sales of Services in the ordinary course of business; 

(11) sales of any LNG related to additional liquefaction trains developed by the Company; 

(12) transfers or novations of Interest Rate Protection Agreements in accordance with the Common Terms Agreement; 

(13) sales or other dispositions of the Improved Facilities (as defined in the Cooperation Agreement); 

  
 4 

 (14) conveyance to gas transmission companies of gas interconnection or metering
facilities built using Capital Expenditures permitted by the Common Terms Agreement; 
 (15) subject to clause (a) of
the definition of Permitted Indebtedness, the assignment, novation or transfer of any Train Five LNG Sales Agreement, any Train Six LNG Sales Agreements or the CMI LNG Sale and Purchase Agreement and any related agreements by the Company to an
Affiliate of the Company; provided, however, that if the Company incurs Expansion Debt in respect of Train Five or Train Six, as applicable, pursuant to clause (a) of the definition of Permitted Indebtedness, any such assignment,
novation or transfer of any Train Five LNG Sales Agreement or any Train Six LNG Sales Agreement, as applicable, and any related agreements by the Company to an Affiliate of the Company shall constitute an Asset Sale unless it otherwise qualifies
under any of the other listed exception in this “Asset Sales” definition; and 
 (16) any single transaction or
series of related transactions pursuant to the terms of an agreement existing on the Notes Issue Date. 
 “Authorized
Officer” means: (a) with respect to any Person that is a corporation, the chairman, president, senior vice president, vice president, treasurer, assistant treasurer,
attorney-in-fact, secretary or assistant secretary of such Person, (b) with respect to any Person that is a partnership, the chairman, president, senior vice
president, vice president, treasurer, assistant treasurer, attorney-in-fact, secretary or assistant secretary of a general partner of such Person and (c) with
respect to any Person that is a limited liability company, the chairman, president, senior vice president, vice president, treasurer, assistant treasurer,
attorney-in-fact, secretary or assistant secretary, the manager, the managing member or a duly appointed officer of such Person. 

“Bankruptcy” means, with respect to any Person, the occurrence of any of the following events, conditions or circumstances:

 (a) such Person shall file a voluntary petition in bankruptcy or shall be adjudicated a bankrupt or insolvent, or shall file any petition
or answer or consent seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief for itself under the Bankruptcy Code or any present or future applicable federal, state or other statute or law
relating to bankruptcy, insolvency, reorganization or other relief for debtors, or shall seek or consent to or acquiesce in the appointment of any trustee, receiver, conservator or liquidator of such Person or of all or any substantial part of its
properties (the term “acquiesce,” as used in this definition, includes the failure to file in a timely manner a petition or motion to vacate or discharge any order, judgment or decree after entry of such order, judgment or decree);

 (b) a case or other proceeding shall be commenced against such Person without the consent or acquiescence of such Person seeking any
reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief with respect to such Person or its debts 

  
 5 

 
under the Bankruptcy Code or any present or future applicable federal, state or other statute or law relating to bankruptcy, insolvency, reorganization or other relief for debtors, or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed or unstayed for a period of 90 consecutive
days; 
 (c) a court of competent jurisdiction shall enter an order, judgment or decree approving a petition filed against such Person
seeking a reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under the Bankruptcy Code, or any other present or future applicable federal, state or other statute or law relating to bankruptcy,
insolvency, reorganization or other relief for debtors, and such Person shall acquiesce in the entry of such order, judgment or decree or such order, judgment or decree shall remain undischarged, unvacated or unstayed for 120 days (whether or not
consecutive) from the date of entry thereof, or any trustee, receiver, conservator or liquidator of such Person or of all or any substantial part of its property shall be appointed without the consent or acquiescence of such Person and such
appointment shall remain unvacated and unstayed for an aggregate of 120 days (whether or not consecutive); 
 (d) such Person shall
admit in writing its inability to pay its debts as they mature or shall generally not be paying its debts as they become due; 
 (e) such
Person shall make an assignment for the benefit of creditors or take any other similar action for the protection or benefit of creditors; 

(f) such Person shall take any corporate or partnership action for the purpose of effecting any of the foregoing; or 

(g) an order for relief shall be entered in respect of such Person under the Bankruptcy Code. 

“Bankruptcy Code” means the United States Bankruptcy Reform Act of 1978, as heretofore and hereafter amended, and codified as
11 U.S.C. Section 11 et seq. 
 “Bankruptcy Law” means the Bankruptcy Code and any other state or federal
insolvency, reorganization, moratorium or similar law for the relief of debtors. 
 “Beneficial Owner” has the meaning
assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular
“person” (as that term is used in Section 13(d)(3) of the Exchange Act), such “person” will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is exercisable only after the passage of time. The terms “Beneficially Owns” and “Beneficially Owned” have a corresponding meaning. 

  
 6 

 “BG” means BG Gulf Coast LNG, LLC. 

“BG FOB Sale and Purchase Agreement” means the Amended and Restated LNG Sale and Purchase Agreement (FOB), dated
January 25, 2012, between the Company and BG, as amended from time to time, and, subject to the provisions of Sections 6.01(6) and 6.01(8), any replacements thereof entered into with the required approval of the Required Secured
Parties or, at any time when there is no Secured Bank Debt outstanding, any replacements thereof meeting the requirements of Section 4.20. 

“Blackstone” means the Blackstone Guarantor and/or Blackstone Holdco, as the context may require. 

“Blackstone Guarantor” means Blackstone Capital Partners VI-Q L.P., a Delaware
limited partnership. 
 “Blackstone Holdco” means Blackstone CQP Holdco LP, a Delaware limited partnership. 

“Blocked Person” means (a) a Person whose name appears on the list of Specially Designated Nationals and Blocked Persons
published by OFAC, (b) a Person, entity, organization, country or regime that is blocked or a target of sanctions that have been imposed under U.S. Economic Sanctions Laws or (c) a Person that is an agent, department or instrumentality of,
or is otherwise beneficially owned by, Controlled by or acting on behalf of, directly or indirectly, any Person, entity, organization, country or regime described in clause (a) or (b). 

“Board of Directors” means: 

(a) with respect to a corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such
board; 
 (b) with respect to a partnership, the Board of Directors of the general partner of the partnership; 

(c) with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and

 (d) with respect to any other Person, the board or committee of such Person serving a similar function. 

“Business Day” means any day other than a Saturday, Sunday or any other day which is a legal holiday or a day on which
banking institutions are permitted or required by law, regulation or executive order to be closed in New York, New York. 

  
 7 

 “Business Interruption Insurance Proceeds” means all proceeds of any insurance
policies required pursuant to the Common Terms Agreement or otherwise obtained with respect to the Company or the Project insuring the Company against business interruption or delayed start-up. 

“Calculation Date” means the last day of the month immediately preceding a Restricted Payment Date. 

“Calculation Period” means, on any Calculation Date, the period commencing twelve months prior to, and ending on, such
Calculation Date; provided, that prior to the first anniversary of the DSCR Start Date, the Calculation Period shall mean the period beginning on the first day of the first full month following the DSCR Start Date and ending on, the
Calculation Date. 
 “Capital Expenditures” means, for any period, the aggregate amount of all expenditures of the Company
payable during such period that, in accordance with GAAP, are or should be included in “purchase of property, plant and equipment” or similar items reflected in the consolidated statement of cash flows of the Company. 

“Capital Lease Obligations” means, for any Person, the obligations of such Person to pay rent or other amounts under a lease
of (or other agreement conveying the right to use) Property of such Person to the extent such obligations are required to be classified and accounted for as a capital lease on a balance sheet of such Person under GAAP (including Accounting Standards
Codification 840-30, Capital Leases of the Financial Accounting Standards Board) and, for purposes of the Financing Documents, the amount of such obligations shall be the capitalized amount of such
obligations, determined in accordance with GAAP (including such ASC 840-30). 
 “Capital
Stock” means: 
 (a) in the case of a corporation, corporate stock; 

(b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock; 
 (c) in the case of a partnership or limited liability company, partnership interests (whether general or
limited) or membership interests; and 
 (d) 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, but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with
Capital Stock. 
 “Cash Equivalents” means: 

(a) Dollars; 

  
 8 

 (b) securities issued or directly and fully guaranteed or insured by the United States government
or any agency or instrumentality of the United States government (provided that the full faith and credit of the United States is pledged in support of those securities) having maturities of not more than one year from the date of acquisition; 

(c) marketable general obligations issued by any state of the United States of America or any political subdivision of any such state or any
public instrumentality thereof maturing within one year from the date of acquisition thereof and, at the time of acquisition thereof, having a credit rating of “A” or better from either S&P or Moody’s (or, if any of such entities
cease to provide such ratings, the equivalent rating from any other Acceptable Rating Agency); 
 (d) certificates of deposit, demand
deposit accounts and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in each case, with any domestic commercial
bank having capital and surplus in excess of $500,000,000 and a Thomson Bank Watch Rating of “B” or better; 
 (e) repurchase
obligations with a term of not more than 30 days for underlying securities of the types described in clauses (b), (c) and (d) above entered into with any financial institution meeting the qualifications specified in clause (d) above;

 (f) commercial paper or tax exempt obligations having one of the two highest ratings obtainable from Moody’s or S&P (or, if any
of such entities cease to provide such ratings, the equivalent rating categories from any other Acceptable Rating Agency) and, in each case, maturing within one year after the date of acquisition; and 

(g) money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (a) through
(f) of this definition or a money market fund or a qualified investment fund (including any such fund for which the Trustee or any Affiliate thereof acts as an advisor or a manager) given one of the two highest long-term ratings available from
S&P or Moody’s (or, if any of such entities cease to provide such ratings, the equivalent rating categories from any other Acceptable Rating Agency). 

“Cash Flow” means, for any period, the sum (without duplication) of the following: 

(a) all cash paid to the Company during such period in connection with the ownership or operation of the Project; 

(b) all interest and investment earnings paid to the Company or accrued during such period; 

(c) all cash paid to the Company during such period as Business Interruption Insurance Proceeds; and 

  
 9 

 (d) all cash paid to the Company during the applicable period from any direct or indirect owner
of the Company by way of equity contribution or subordinated shareholder loans (in each case as otherwise permitted pursuant to the terms of the Financing Documents); 

provided, however, that Cash Flow shall not include any proceeds of any Senior Debt or any other Indebtedness incurred by the Company; Insurance
Proceeds; Condemnation Proceeds; proceeds from any disposition of assets of the Project or the Company other than the sale of capacity and other commercial products in the ordinary course of business and tax refunds. 

“Cash Flow Available for Debt Service” means, for any period, an amount equal to the amount of Cash Flow received by the
Company during such period minus all operating and maintenance expenses paid during such period. 
 “Centrica FOB Sale and Purchase
Agreement” means the LNG Sale and Purchase Agreement (FOB), dated March 22, 2013, between the Company and Centrica plc, as amended from time to time, and, subject to the provisions of Sections 6.01(6) and 6.01(8), any
replacements thereof entered into with the required approval of the Required Secured Parties or, at any time when there is no Secured Bank Debt outstanding, any replacements thereof meeting the requirements of Section 4.20.

 “Change of Control” means the Parent shall own, directly or indirectly, less than 50% of the voting and economic
interests in the Company; provided that a Change of Control shall not be deemed to have occurred if the Company shall have received letters from any two Acceptable Rating Agencies (or if only one Acceptable Rating Agency is then rating the
Notes, the Company shall have received a letter from that Acceptable Rating Agency) to the effect that the Acceptable Rating Agency has considered the contemplated event under this definition and that, if the contemplated event occurs, such
Acceptable Rating Agency would reaffirm the then current rating of the Notes as of the date of such event.  

“Clearstream” means Clearstream Banking, société anonyme, or any successor securities clearing agency.

 “CMI LNG Sale and Purchase Agreement” means the LNG Sale and Purchase Agreement (FOB), dated May 14, 2012, between
the Company and Cheniere Marketing, LLC, as amended from time to time. 
 “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. 
 “Collateral”
means the Collateral (as defined in each of the Security Documents). 
 “Commission” or “SEC” means
the United States Securities and Exchange Commission. 

  
 10 

 “Common Security Trustee” means Société Générale or
any successor to it appointed pursuant to the terms of the Security Agency Agreement. 
 “Common Security Trustee/Term Loan A
Administrative Agent Fee Letter” means the Fee Letter dated as of July 30, 2012, between the Company and Société Générale, in its capacities as the Term Loan A Administrative Agent and the Common Security
Trustee. 
 “Common Terms Agreement” means the Second Amended and Restated Common Terms Agreement, dated as of
June 30, 2015, among the Company, the Secured Debt Holder Group Representatives, the Secured Hedge Representatives, the Secured Gas Hedge Representatives, the Common Security Trustee and the Intercreditor Agent, as amended from time to time.

 “Company” means Sabine Pass Liquefaction, LLC, and any and all successors thereto. 

“Condemnation Proceeds” means any amounts and proceeds of any kind (including instruments) payable in respect of any Event of
Taking. 
 “ConocoPhillips License Agreements” means the License Agreements between the Company and ConocoPhillips Company,
dated as of May 3, 2012 and dated as of December 21, 2012, as each is amended from time to time. 
 “Consents”
means (a) each consent to collateral assignment required to be entered into pursuant to the Financing Documents, in each case, by and among the Company, the Common Security Trustee and the Persons identified therein and (b) each
subordination, non-disturbance, surface use and/or recognition agreement, affidavit of use and possession, estoppel certificate from counterparties to the Real Property Documents required to be entered into
pursuant to the Financing Documents. 
 “Construction Account” means the Construction Account so designated, established
and created by the Accounts Bank pursuant to the Accounts Agreement. 
 “Construction/Term Loan” means a loan made by the
Secured Bank Debt Holders to the Company in an aggregate amount of up to $3,626,000,000 in accordance with and pursuant to the terms of the Term Loan A Credit Agreement. 

“Consultants” means the Independent Engineer, the Insurance Advisor and the Market Consultant. 

“Contest” or “Contested” means, with respect to any Person, with respect to any Taxes or any Lien imposed on
Property of such Person (or the related underlying claim for labor, material, supplies or services) by any Government Authority for Taxes or with respect to obligations under ERISA or any Mechanics’ Lien (each, a “Subject
Claim”), a contest of the amount, validity or 

  
 11 

 
application, in whole or in part, of such Subject Claim pursued in good faith and by appropriate legal, administrative or other proceedings diligently conducted so long as: 

(a) during the period of such contest the enforcement of such Subject Claim is effectively stayed and any Lien (including any inchoate Lien)
arising by virtue of such Subject Claim and securing amounts in excess of $25,000,000 shall, if required by applicable Government Rule, be effectively secured by posting of cash collateral or a surety bond (or similar instrument) by a reputable
surety company; 
 (b) no Secured Party or any of its officers, directors or employees has been or could reasonably be expected to be
exposed to any risk of criminal or civil liability or sanction in connection with such contested items; 
 (c) the failure to pay such
Subject Claim under the circumstances described above could not otherwise reasonably be expected to result in a Material Adverse Effect; and 

(d) any contested item determined to be due, together with any interest or penalties thereon, is promptly paid when due after resolution of
such Contest, if required by such resolution. The term “Contest” used as a verb shall have a correlative meaning. 

“Contracted Cash Flow” means the sum of (a) the projected cash to be received by the Company with respect to Monthly
Sales Charges or the fixed price component based on FOB LNG Sale and Purchase Agreements that, at the time of such incurrence, are in effect and not in material default, plus (b) the projected cash to be received by the Company with
respect to Monthly Sales Charges (or the fixed price component) based on LNG sales contracts that, at the time of such incurrence, are in effect and not in material payment default or a breach that has resulted in a material non-payment by the counterparty to such agreement and are with counterparties that (1) have an Investment Grade Rating from at least two Acceptable Rating Agencies, or who provide a guaranty from an affiliate
that has at least two of such ratings or (2) have a direct or indirect parent with an Investment Grade Rating from at least one Acceptable Rating Agency and either the counterparty or an affiliate of such counterparty who is providing a
guaranty has a tangible net worth in excess of $15,000,000,000, minus (c) the fixed expenses that could reasonably be expected to be incurred if the counterparties to the FOB LNG Sale and Purchase Agreements and such other LNG sales
agreements were not lifting any cargoes from the Company; provided that for the purposes of Section 4.08(a)(2), it shall not be a material default, material payment default or a breach that has resulted in a material non-payment under clause (a) or clause (b) of this definition, as applicable, if (A) a Bankruptcy has occurred in respect of the applicable counterparty to such FOB LNG Sale and Purchase Agreement or
such LNG sales contract, as applicable, and the bankruptcy court enters an order permitting the assumption of the applicable FOB LNG Sale and Purchase Agreement or LNG sales contract or (B) such counterparty continues to meet its contractual
obligations thereunder. 
 “Contracted Cash Flow Available for Debt Service” means, for any period, an amount equal to the
sum of (i) the amount set forth in clauses (a) and (b) of the definition of Contracted Cash Flow expected to be received by the Company during such period, minus (ii) the amount set forth in clause (c) of the
definition of Contracted Cash Flow expected to be paid during such period plus (iii) any amounts expected to be received pursuant to clauses (b) and (c) of the definition of Cash Flow during such period. 

  
 12 

 “Control” (including, with its correlative meanings, “Controlled by”
and “under common Control with”) means possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by
contract or otherwise) and, in any event, any Person owning at least 50% of the voting securities of another Person shall be deemed to Control that Person. 

“Controlled Entity” means (a) any of the Subsidiaries of the Company and any of their or the Company’s respective
Controlled Affiliates and (b) Parent and its Controlled Affiliates. 
 “Cooperation Agreement” means the Cooperation
Agreement, dated July 31, 2012, between the Company and SPLNG, as amended from time to time. 
 “Corporate Trust Office of the
Trustee” means the address of the Trustee at which at any particular time its corporate trust business shall be principally administered, which office at the date of the execution of this instrument is located at the address specified in
Section 13.01 or such other address as to which the Trustee may designate from time to time by notice to the Company, or the principal corporate trust office of any successor Trustee (or such other address as such successor
Trustee may designate from time to time by notice to the Company). 
 “Covered Action” means: 

(a) any consent to a Modification of or under any Financing Document by the Intercreditor Agent, the Common Security Trustee or any Secured
Party, other than any Permitted Modification; 
 (b) any instruction given to the Common Security Trustee under or with respect to any
Financing Document; and 
 (c) any exercise of discretion by the Intercreditor Agent, a Secured Debt Holder Group Representative or the
Common Security Trustee under or with respect to any Financing Document to the extent the Intercreditor Agent, Secured Debt Holder Group Representative or the Common Security Trustee requests instruction, in each case other than certain
Administrative Decisions permitted by the Intercreditor Agreement. 
 “CQP Indemnity Letter” means that certain indemnity
letter, dated as of July 31, 2012, between the Parent and the Company with respect to Leases, Sublease and the Sabine Liquefaction TUA. 

“CQP Security Agreement” means the Security Agreement, dated as of July 31, 2012, between the Parent and the Common
Security Trustee. 

  
 13 

 “Creole Trail Pipeline Transportation Agreement” means the Firm Transportation
Agreement, dated as of March 11, 2015, between the Company and Cheniere Creole Trail Pipeline, L.P. pursuant to the Creole Trail Precedent Agreement. 

“Creole Trail Precedent Agreement” means the Transportation Precedent Agreement, dated as of August 6, 2012, between the
Company and Cheniere Creole Trail Pipeline, L.P., as amended by that certain First Amendment to Transportation Precedent Agreement Firm Transportation Services, dated as of November 5, 2012, as further amended by that certain Second Amendment
to Transportation Precedent Agreement Firm Transportation Services, dated as of March 11, 2015. 
 “CTA Event of
Default” means any of the events described in Section 9 (Events of Default for Secured Debt) in the Common Terms Agreement. 

“Custodian” means the Trustee, as custodian with respect to the Notes in global form, or any successor entity thereto. 

“Debt Service” means, for any period, the sum of (without duplication): 

(a) all fees scheduled to become due and payable (or, for purposes of the Debt Service Coverage Ratio, accrued or paid) during such period in
respect of any Senior Debt; 
 (b) interest on the Senior Debt (taking into account any Interest Rate Protection Agreements) scheduled to
become due and payable (or for the purposes of the Debt Service Coverage Ratio, accrued or paid) during such period; 
 (c) scheduled
principal payments of the Senior Debt to become due and payable (or, for purposes of the Debt Service Coverage Ratio, accrued or paid) during such period; 

(d) all payments due or anticipated to become due (or, for purposes of the Debt Service Coverage Ratio, accrued or paid) by the Company
pursuant to and provision in respect of increased costs or taxes under any Secured Bank Debt with respect to such principal, interest and fees and similar payments under any Senior Debt Instrument; and 

(e) any indemnity payments due to any of the Secured Parties. 

“Debt Service Coverage Ratio” or “DSCR” means, at any date, the ratio of Cash Flow Available for Debt
Service for the preceding 12-month period to the aggregate amount required to service the Company’s Debt Service payable for the preceding 12-month period
(excluding Working Capital Debt, all Indebtedness or Guarantees incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08, and all Indebtedness or Guarantees that would have
been permitted to be incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08 of the 2013 Indenture prior to the Investment Grade Date and the scheduled principal payment of any Senior Debt that
has bullet maturities or balloon payments at 

  
 14 

 
maturity or in the final year prior to maturity); provided, that for purposes of Section 4.06, any DSCR calculation performed prior to the first anniversary of
the DSCR Start Date will be based on the number of months elapsed since the DSCR Start Date; provided, further, that the Company may exclude from any DSCR calculation the Cash Flow Available for Debt Service and the prorated aggregate
amount required to service the Company’s Debt Service attributable to any month in which a Force Majeure Event had occurred or was continuing for up to twelve months in any period for which any DSCR calculation is performed. 

“Debt Service Reserve Account” means any Debt Service Reserve Account so designated, established and created by the Accounts
Bank pursuant to the Accounts Agreement. 
 “Default” means an Event of Default or CTA Event of Default, as applicable, or
an event or condition which, with the giving of notice, lapse of time or upon a declaration or determination being made (or any combination thereof), would become an Event of Default or CTA Event of Default, as applicable. 

“Definitive Note” means a certificated Note registered in the name of the Holder thereof, issued in accordance with
Section 2.3 of Appendix A, and, in the case of Initial Notes, substantially in the form of Exhibit A-1 except that such Note shall not bear the Global Note Legend and
shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto. 
 “Default
Contracts” means any Default LNG Sale and Purchase Agreement and any of the Train One and Train Two EPC Contract, the Sabine Liquefaction TUA and, if the Company incurs Expansion Debt in respect of Train Three and Train Four pursuant to
clause (a) of the definition of Permitted Indebtedness, the Train Three and Train Four EPC Contract. 
 “Default LNG Sale and
Purchase Agreement” means: 
 (a) at any time following Substantial Completion of Train Four, any Facility LNG Sale and Purchase
Agreement if (i) such Facility LNG Sale and Purchase Agreement, together with any other Facility LNG Sale and Purchase Agreement that is a Default LNG Sale and Purchase Agreement, accounts for more than 25% of the net revenues of the Company
for the prior twelve months and are anticipated to account for at least 25% of the net revenues of the Company over the following twelve months and (ii) such Facility LNG Sale and Purchase Agreement, together with any other Facility LNG Sale
and Purchase Agreement that is a Default LNG Sale and Purchase Agreement, has a remaining term of more than four years; and 
 (b) at all
other times, any of the Train One and Train Two LNG Sales Agreements and, if the Company incurs Expansion Debt in respect of Train Three and Train Four pursuant to clause (a) of the definition of Permitted Indebtedness, any of the Train Three
and Train Four LNG Sales Agreements.  

  
 15 

 “Depositary” means, with respect to the Notes issuable or issued in whole or in
part in global form, the Person specified in Section 2.05 as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable
provision of this Indenture. 
 “Designated Voting Party” means, at any time, with respect to any Secured Debt Instrument,
(i) the Secured Debt Holder Group Representative of such Secured Debt Holder Group or (ii) such other Person which has been authorized to act as a Designated Voting Party by the Secured Debt Holder Group Representative of such Secured Debt
Holder Group in a written notice given to the Intercreditor Agent and each other Secured Debt Holder Group Representative. 

“Development” means the development, acquisition, ownership, occupation, construction, equipping, testing, repair, operation,
maintenance and use of the Project and the purchase and sale of natural gas and the sale of LNG, the export of LNG from the Project (and, if elected, the import of LNG to the extent the Company has all necessary Government Approvals therefor), the
transportation of natural gas to the Project by third parties, and the sale of other Services or other products or by-products of the Project and all activities incidental thereto, in each case in accordance
with the Transaction Documents. “Develop” and “Developed” shall have the correlative meanings. 

“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is
convertible, or for which it is exchangeable, in each case, at the option of the holder of the Capital Stock), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91 days after the date on which the Notes mature. Notwithstanding the preceding sentence, any Capital Stock that would constitute
Disqualified Stock solely because the holders of the Capital Stock have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms
of such Capital Stock provide that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with the covenant in Section 4.06. The amount of
Disqualified Stock deemed to be outstanding at any time for purposes of this Indenture will be the maximum amount that the Company and its Restricted Subsidiaries may become obligated to pay upon the maturity of, or pursuant to any mandatory
redemption provisions of, such Disqualified Stock, exclusive of accrued dividends. 
 “Distribution Account” means the
Distribution Account so designated, established and created by the Accounts Bank pursuant to the Accounts Agreement. 

“DOE/FE” means the United States Department of Energy Office of Fossil Energy or any successor thereto having jurisdiction
over the import of LNG to and the export of LNG from the Project. 

  
 16 

 “Dollars” and “$” means lawful money of the United States. 

“Domestic Subsidiary” means any Restricted Subsidiary of the Company that was formed under the laws of the United States or
any state of the United States or the District of Columbia or that guarantees or otherwise provides direct credit support for any Indebtedness of the Company. 

“DSCR Start Date” means September 15, 2016. 

“EPC Contractor” means Bechtel Oil, Gas and Chemicals, Inc. or, in the case of the EPC Contract with respect to Train Six,
the relevant contractor under such EPC Contract. 
 “EPC Contract” means any of the Train One and Train Two EPC Contract,
the Train Three and Train Four EPC Contract, the Train Five EPC Contract and any engineering, procurement and construction contract entered into by the Company related to the construction of Train Six, as applicable. 

“Equity Contribution Amount” means $1,890,000,000. 

“Equity Interests” means, with respect to any Person, any 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, in each such case including all voting rights and economic rights related thereto. 
 “ERISA” means the
Employee Retirement Income Security Act of 1974, as amended from time to time. 
 “Euroclear” means Euroclear Bank,
S.A./N.V. or any successor securities clearing agency. 
 “Event of Abandonment” means any of the following shall have
occurred: 
 (a) the abandonment, suspension or cessation of all or a material portion of the activities related to the Development for a
period in excess of 60 consecutive days (other than as a result of force majeure so long as the Company is diligently attempting to restart the Development); 

(b) a formal, public announcement by the Company of a decision to abandon or indefinitely defer or suspend the Development for any reason; or

  
 17 

 (c) the Company shall make any filing with FERC giving notice of the intent or requesting
authority to abandon the Development for any reason. 
 “Event of Loss” means any event that causes the Pipeline or any
Property of the Company, or any portion thereof, to be damaged, destroyed or rendered unfit for normal use for any reason whatsoever, and shall include an Event of Taking. 

“Event of Taking” means any taking, seizure, confiscation, requisition, exercise of rights of eminent domain, public
improvement, inverse condemnation, condemnation or similar action of or proceeding by any Government Authority relating to all or any part of the Pipeline or the Project, any Equity Interests in the Company or any other part of the Collateral. 

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

“Expansion Debt” means additional senior secured or unsecured Indebtedness to finance the development of additional Trains
and to be incurred after the Notes Issue Date. 
 “Export Credit Agency” means any export credit agency or similar
financial institution. 
 “Facility LNG Sale and Purchase Agreements” means, collectively, the Train One and Train Two LNG
Sales Agreements, the Train Three and Train Four LNG Sales Agreements, the Train Five LNG Sales Agreement and any additional LNG sales agreements entered into by the Company. 

“Fair Market Value” means the value that would be paid by a willing buyer to an unaffiliated willing seller in a transaction
not involving distress or necessity of either party, determined in good faith by the Board of Directors of the Company (unless otherwise provided in this Indenture). 

“FATCA Withholding Tax” shall mean any withholding Tax pursuant to an agreement described in Section 1471(b) of the Code or
otherwise imposed pursuant to Sections 1471 through 1474 of the Code (and any regulations or agreements thereunder or official interpretations thereof) or any intergovernmental agreement between the United States and another jurisdiction
facilitating the implementation thereof (or any law implementing such an intergovernmental agreement). 
 “Fee Letters”
means the Joint Lead Arranger Fee Letters, the Accounts Bank Fee Letter, the Common Security Trustee/Term Loan A Administrative Agent Fee Letter and the Intercreditor Agent Fee Letter. 

“FERC” means the United States Federal Energy Regulatory Commission or any successor thereto having jurisdiction over the
transportation of natural gas through, or the siting, construction or operation of, the Project. 

  
 18 

 “Final Completion” has the meaning assigned to the term “Final
Completion” in the Train One and Train Two EPC Contract. 
 “Financing Documents” means each of: 

(a) the Common Terms Agreement; 

(b) this Indenture and any additional indentures entered into in connection with the issuance of any additional Senior Bonds; 

(c) each other Secured Debt Instrument; 

(d) each of the Security Documents; 

(e) the Security Agency Agreement; 

(f) the Intercreditor Agreement; 

(g) the Notes; 
 (h) the
Permitted Hedging Agreements; 
 (i) the Fee Letters; 

(j) the CQP Indemnity Letter;     

(k) the Hedge Opportunity Letter; 

(l) the Notarial Assignment; 

(m) the other financing and security agreements, documents and instruments delivered in connection with the Common Terms Agreement; and 

(n) each other document designated as a Financing Document by the Company and each Secured Debt Holder Group Representative. 

“Fiscal Quarter” means each three-month period commencing on January 1, April 1, July 1 and October 1 of
any Fiscal Year and ending on the next March 31, June 30, September 30 and December 31, respectively. 
 “Fiscal
Year” means any period of 12 consecutive calendar months beginning on January 1 and ending on December 31 of each calendar year. 

“Fitch” means Fitch Ratings, Ltd. 

  
 19 

 “FOB Sale and Purchase Agreements” means, collectively, the BG FOB Sale and
Purchase Agreement, the Centrica FOB Sale and Purchase Agreement, the GN FOB Sale and Purchase Agreement, the KoGas FOB Sale and Purchase Agreement, the GAIL FOB Sale and Purchase Agreement and the Total FOB Sale and Purchase Agreement. 

“Force Majeure Event” means the occurrence of a Force Majeure event under any of the Facility LNG Sale and Purchase
Agreements. 
 “Fundamental Decision” means: 

(a) Modifying Article V (Application of Funds) of the Accounts Agreement, other than Section 5.08 (Insurance/Condemnation
Proceeds Account) of the Accounts Agreement, and defined terms used therein; 
 (b) Modifying any of the provisions of Section 2.4
(Working Capital Debt), 2.5 (Replacement Debt) or 7.5 (Restrictions on Indebtedness) of the Common Terms Agreement, governing the incurrence by the Company of Working Capital Debt and Replacement Debt; 

(c) Modifying any of the conditions for the making of Restricted Payments under Section 7.7 (Restricted Payments) of the Common
Terms Agreement; 
 (d) Modifying any of the provisions of Section 7.8 (Limitation on Liens) of the Common Terms Agreement,
Section 2.1 (Granting Clause) of the Security Agreement or Section 2.1 (Granting Clause) of the Pledge Agreement or any other provision of the Financing Documents governing the granting of or priority of the Liens over the
Security; 
 (e) Modifying any of the provisions of Section 7.2 (Prohibition of Fundamental Changes) of the Common Terms
Agreement; and 
 (f) Modifying the definition of “Project Completion Date” as set out in the Common Terms Agreement. 

“Fundamental Government Approvals” the approvals and permits issued by FERC and DOE/FE as set forth on Schedule 4.6(a)
of the Common Terms Agreement, and, when obtained, the approvals and permits issued by FERC and DOE/FE as set forth on Schedule 4.6(b) of the Common Terms Agreement. 

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of
the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied. 

“GAIL” means GAIL (India) Limited. 

  
 20 

 “GAIL FOB Sale and Purchase Agreement” means the LNG Sale and Purchase Agreement
(FOB), dated December 11, 2011, between the Company and GAIL, as amended from time to time, and, subject to the provisions of Sections 6.01(6) and 6.01(8), any replacements thereof entered into with the required approval of the
Required Secured Parties or, at any time when there is no Secured Bank Debt outstanding, any replacements thereof meeting the requirements of Section 4.20. 

“Gas” means any hydrocarbon or mixture of hydrocarbons consisting predominantly of methane which is in a gaseous state. 

“Gas Hedge Provider” means any party (other than the Loan Parties or any of their Affiliates) that is a party to a Permitted
Hedging Agreement described in clause (b) of the definition thereof that is secured by a Security in the Collateral pursuant to the Security Documents. 

“Gas Hedge Termination Value” means the amount of any termination payment owed by the Company to a Gas Hedge Provider under a
Secured Gas Hedge Instrument, or to any other counterparty under a Gas hedge agreement that is not a Secured Gas Hedge Instrument, in either case upon the termination of the Secured Gas Hedge Instrument or such other Gas hedge agreement that is not
a Secured Gas Hedge Instrument as a result of a party’s default thereunder. 
 “General Partner” means Cheniere Energy
Partners GP, LLC. 
 “Global Note Legend” means (i) in the case of the Initial Notes, the legend set forth in
Section 2.3(g)(2) of Appendix A and (ii) in the case of any Additional Notes, a legend required or permitted by Section 2.1(d) of Appendix A. 

“Global Notes” means, individually and collectively, each of the Restricted Global Notes, the Unrestricted Global Notes and
any Additional Notes issued as a Global Note, deposited with or on behalf of and registered in the name of the Depositary or its nominee, issued in accordance with Sections 2.1 and 2.3 of Appendix A. 

“GN” means Gas Natural Aprovisionamientos SDG S.A. 

“GN FOB Sale and Purchase Agreement” means the LNG Sale and Purchase Agreement (FOB), dated November 21, 2011, between
the Company and GN, as amended from time to time, and, subject to the provisions of Sections 6.01(6) and 6.01(8), any replacements thereof entered into with the required approval of the Required Secured Parties or, at any time when
there is no Secured Bank Debt outstanding, any replacements thereof meeting the requirements of Section 4.20. 

“Government Approval” means (a) any authorization, consent, approval, license, lease, ruling, permit, tariff, rate,
certification, waiver, exemption, filing, variance, claim, order, judgment or decree of, by or with, (b) any required notice to, (c) any declaration of or with or (d) any registration by or with, any Government Authority. 

  
 21 

 “Government Authority” means any supra-national, federal, state or local
government or political subdivision thereof or other entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and having jurisdiction over the Person or matters in question. 

“Government Rule” means any statute, law, regulation, ordinance, rule, judgment, order, decree, directive, requirement of, or
other governmental restriction or any similar binding form of decision of or determination by, or any interpretation or administration of any of the foregoing by, any Government Authority, including all common law, which is applicable to any Person,
whether now or hereafter in effect. 
 “Government Securities” means securities that are direct obligations of, or
obligations guaranteed by, the United States of America for the timely payment of which its full faith and credit is pledged. 

“Guarantee” means a guarantee, an endorsement, a contingent agreement to purchase or to furnish funds for the payment or
maintenance of, or otherwise to be or become contingently liable under or with respect to, the Indebtedness, other obligations, net worth, working capital or earnings of any Person, or a guarantee of the payment of dividends or other distributions
upon the stock or equity interests of any Person, or an agreement to purchase, sell or lease (as lessee or lessor) Property of any Person, products, materials, supplies or services primarily for the purpose of enabling a debtor to make payment of
his, her or its obligations or an agreement to assure a creditor against loss, and including causing a bank or other financial institution to issue a letter of credit or other similar instrument for the benefit of another Person, but excluding
(a) endorsements for collection or deposit in the ordinary course of business and (b) customary non-financial indemnity or hold harmless provisions included in contracts entered into in the ordinary
course of business. The terms “Guarantee” and “Guaranteed” used as verbs shall have correlative meanings. 

“Guaranteed Substantial Completion Date” means the “Guaranteed Substantial Completion Date” or any equivalent term,
with respect to each Train, as defined in the applicable EPC Contract. 
 “Guarantors” means each Subsidiary of the Company
that executes a Note Guarantee in accordance with the provisions of this Indenture, and each such Person’s respective successors and assigns, in each case, until the Note Guarantee of such Person has been released in accordance with the
provisions of this Indenture. 
 “Hedge Opportunity Letter” means the Hedge Opportunity Letter, dated as of July 11,
2012, among the Company, The Bank of Tokyo-Mitsubishi UFJ, Ltd., Union Bank, N.A., Crédit Agricole Corporate and Investment Bank, Credit Suisse Securities (USA) LLC, HSBC Securities 

  
 22 

 
(USA), Inc., J.P. Morgan Securities LLC, Morgan Stanley Senior Funding, Inc., Royal Bank of Canada, SG Americas Securities, LLC, Deutsche Bank Trust Company Americas, Standard Chartered Bank, and
Sovereign Bank, N.A. 
 “Hedge Termination Value” means, in respect of any Interest Rate Protection Agreement, after taking
into account the effect of any legally enforceable netting agreement to which the Company is a party relating to such Interest Rate Protection Agreement, for any date on or after the date such Interest Rate Protection Agreement has been closed out
and termination value determined in accordance therewith, such termination value. 
 “Hedging Agreement” means any
agreement in respect of any interest rate, swap, forward rate transaction, commodity swap, commodity option, commodity future, interest rate option, interest or commodity cap, interest or commodity collar transaction, currency swap agreement,
currency future or option contract, or other similar agreements (other than the Term Loan A Credit Agreement). 
 “Holder”
means a Person in whose name a Note is registered. 
 “IAI Global Note” means a Global Note issued in accordance with
Section 2.1(c)(1)(B) of Appendix A. 
 “Immaterial Subsidiary” means, as of any date, any Restricted
Subsidiary whose total assets, as of that date, are less than $5,000,000 and whose total revenues for the most recent 12-month period do not exceed $5,000,000. 

“Impairment” means, with respect to any Government Approval; 

(a) the rescission, revocation, staying, withdrawal, early termination, cancellation, repeal or invalidity thereof or otherwise ceasing to be
in full force and effect; 
 (b) the suspension or injunction thereof; or 

(c) the inability to satisfy in a timely manner stated conditions to effectiveness or amendment, modification or supplementation thereof in
whole or in part. The verb “Impair” shall have a correlative meaning. 

“In-Service Date” means (a) with respect to Train One, May 27, 2016, and
with respect to Train Two, September 15, 2016, and (b) with respect to the EPC Contract with respect to any other Train, the date when the Independent Engineer shall have certified in writing to the Trustee that “substantial
completion” (based on the corresponding defined term in such EPC Contract) of such Train has occurred. 

  
 23 

 “Indebtedness” of any Person means without duplication: 

(a) all obligations of such Person for borrowed money or in respect of deposits or advances of any kind; 

(b) all obligations of such Person evidenced by bonds, debentures, notes, loan agreements, or similar instruments; 

(c) all obligations of such Person upon which interest charges are customarily paid; 

(d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person
(even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property or are otherwise limited in recourse); 

(e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable
incurred in the ordinary course of business); 
 (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed; 

(g) all Guarantees by such Person of Indebtedness of others; 

(h) all Capital Lease Obligations of such Person; 

(i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit (including standby and
commercial), bank guaranties, surety bonds, letters of guaranty and similar instruments; 
 (j) all obligations of such Person in respect of
any Hedging Agreement; 
 (k) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances; and 

(l) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interests of
such Person or any other Person or any warrants, rights or options to acquire such Equity Interests, valued, in the case of redeemable preferred interests, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid
dividends. 
 The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such
Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is
not liable therefor. 

  
 24 

 “Indenture” means this Indenture, as amended or supplemented from time to time.

 “Independent Engineer” means Lummus Consultants International, Inc. (f/k/a Shaw Consultants International, Inc.) and any
replacement thereof appointed by the Required Secured Parties and, if no CTA Event of Default shall then be occurring, after consultation with the Company. 

“Indirect Participant” means a Person who holds a beneficial interest in a Global Note through a Participant. 

“Initial Notes” means $800,000,000 aggregate principal amount of 5.00% Senior Secured Notes due 2037 issued under this
Indenture on the date hereof. 
 “Initial Notes Purchase Agreement” means the Note Purchase Agreement, dated
February 24, 2017, between the Company and the purchasers named therein, pursuant to which the Initial Notes were issued. 

“Initial Purchasers” means, with respect to the Initial Notes, the purchasers named in the Initial Notes Purchase Agreement,
and with respect to any Additional Notes, the purchaser or purchasers of such Additional Notes from the Company. 
 “Initial Senior
Secured Debt Closing Date” means July 31, 2012. 
 “Institutional Accredited Investor” means an institution
that is an “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act, who is not also a QIB. 

“Insurance Advisor” means Aon Risk Services and any replacement thereof appointed by the Required Secured Parties and, if no
CTA Event of Default shall then be occurring, after consultation with the Company. 
 “Insurance Proceeds” means all
proceeds of any insurance policies required pursuant to the Common Terms Agreement or otherwise obtained with respect to the Company or the Project that are paid or payable to or for the account of the Company as loss payee (other than Business
Interruption Insurance Proceeds and proceeds of insurance policies relating to third party liability). 
 “Insurance/Condemnation
Proceeds Account” means the Insurance/Condemnation Proceeds Account so designated, established and created by the Accounts Bank pursuant to the Accounts Agreement. 

“Intercreditor Agent” means Société Générale or any successor to it, appointed pursuant to the
terms of the Intercreditor Agreement. 

  
 25 

 “Intercreditor Agent Fee Letter” means the Fee Letter, dated as of July 31,
2012, between the Company and the Intercreditor Agent. 
 “Intercreditor Agreement” means the Second Amended and
Restated Intercreditor Agreement, dated as of June 30, 2015, among the Secured Bank Debt Holder Group Representatives, each other Secured Debt Holder Group Representative party thereto, the Secured Hedge Representatives, the Secured Gas Hedge
Representatives, the Common Security Trustee and the Intercreditor Agent, as amended from time to time. 
 “Intercreditor
Vote” means, at any time, a vote conducted in accordance with the procedures set forth in Article 3 (Voting and Decision-Making) of the Intercreditor Agreement among the Designated Voting Parties entitled to vote with respect to the
particular decision at issue at such time. 
 “Interest Rate Protection Agreements” means each interest rate swap, collar,
put, or cap, or other interest rate protection arrangement between the Company and a Qualified Counterparty. 
 “International LNG
Terminal Standards” means to the extent not inconsistent with the express requirements of the Common Terms Agreement, the international standards and practices applicable to the design, construction, equipment, operation or maintenance of
LNG receiving, exporting, liquefaction and regasification terminals, established by the following (such standards to apply in the following order of priority): (a) a Government Authority having jurisdiction over the Company, (b) the SIGTTO
or any successor body of the same) and (c) any other internationally recognized non -governmental agency or organization with whose standards and practices it is customary for reasonable and prudent operators of LNG receiving, exporting,
liquefaction and regasification terminals to comply. In the event of a conflict between any of the priorities noted above, the priority with the lowest Roman numeral noted above shall prevail. 

“International LNG Vessel Standards” means to the extent not inconsistent with the express requirements of the Common Terms
Agreement, the international standards and practices applicable to the ownership, design, equipment, operation or maintenance of LNG vessels established by: (a) the International Maritime Organization, (b) the Oil Companies International
Marine Forum, (c) SIGTTO (or any successor body of the same), (d) the International Navigation Association, (e) the International Association of Classification Societies, and (f) any other internationally recognized agency or non-governmental organization with whose standards and practices it is customary for reasonable and prudent operators of LNG vessels to comply. In the event of a conflict between any of the priorities noted above,
the priority with the lowest Roman numeral noted above shall prevail. 
 “Investment” means, for any Person: 

(a) the acquisition (whether for cash, Property of such Person, services or securities or otherwise) of capital stock, bonds, notes,
debentures, partnership or other ownership interests or 

  
 26 

 
other securities of any other Person or any agreement to make any such acquisition (including any “short sale” or any other sale of any securities at a time when such securities are not
owned by the Person entering into such sale); 
 (b) the making of any deposit with, or advance, loan or other extension of credit to, any
other Person (including the purchase of Property from another Person subject to an understanding or agreement, contingent or otherwise, to resell such Property to such Person, but excluding any such advance, loan or extension of credit having a term
not exceeding 90 days representing the purchase price of inventory or supplies sold in the ordinary course of business); and 
 (c) the
entering into of any Guarantee of, or other contingent obligation (other than an indemnity which is not a Guarantee) with respect to, Indebtedness or other liability of any other Person; 

provided, that Investment shall not include amounts deposited pursuant to the escrow agreement entered with respect to disputed amounts under any EPC
Contract. 
 “Investment Grade Date” means January 9, 2017. 

“Investment Grade Issue Rating” means Baa3 or better by Moody’s, BBB- or better
by Fitch, BBB- or better by S&P or, if any of such entities cease to rate the Notes for reasons outside of the control of the Company, the equivalent investment grade credit rating from any other
Acceptable Rating Agency selected by the Company as a replacement agency. 
 “Investment Grade Rating” means Baa3 or better
by Moody’s, BBB- or better by Fitch, BBB- or better by S&P or the equivalent investment grade credit rating from any other Acceptable Rating Agency. 

“Issue Date” means the first date of original issuance of the Notes under this Indenture. 

“Joint Lead Arranger Fee Letters” means (i) the Fee Letter, dated as of July 11, 2012, between The Bank of
Tokyo-Mitsubishi UFJ, Ltd. and the Company, (ii) the Fee Letter, dated as of July 11, 2012, between Union Bank, N.A. and the Company, (iii) the Fee Letter, dated as of July 11, 2012, between Crédit Agricole Corporate and
Investment Bank and the Company, (iv) the Upfront Fee Letter, dated as of July 11, 2012, between Credit Suisse AG, Cayman Islands Branch and the Company, (v) the Structuring Fee Letter, dated as of July 11, 2012, between Credit
Suisse Securities (USA) LLC and the Company, (vi) the Fee Letter, dated as of July 11, 2012, between HSBC Securities (USA), Inc. and the Company, (vii) the Fee Letter, dated as of July 11, 2012, between J.P. Morgan Securities LLC
and the Company, (viii) the Fee Letter, dated as of July 11, 2012, between Morgan Stanley Senior Funding, Inc. and the Company, (ix) the Fee Letter, dated as of July 11, 2012, between Royal Bank of Canada and the Company,
(x) the Fee Letter, dated as of July 11, 2012, between SG Americas Securities, LLC and the Company, (xi) the Underwriting Fee Letter, dated as of July 11, 2012, between Deutsche 

  
 27 

 
Bank Trust Company Americas and the Company, (xii) the Structuring Fee Letter, dated as of July 11, 2012, between Deutsche Bank Securities Inc. and the Company, (xiii) the Swap
Coordination Fee Letter, dated as of July 11, 2012, between Deutsche Bank Securities Inc. and the Company, and (xi) the Fee Letter, dated as of July 11, 2012, between Standard Chartered Bank and the Company. 

“KEXIM” means The Export-Import Bank of Korea, an official export credit agency incorporated by the Export-Import Bank of
Korea Act as amended on July 25, 2011, duly organized and existing under the laws of the Republic of Korea. 
 “KEXIM Covered
Facility Agreement” means the facility agreement, dated as of June 30, 2015, by and among the Company, the KEXIM Facility Agent, the Common Security Trustee, KEXIM and the KEXIM Covered Facility Lenders. 

“KEXIM Covered Facility Lenders” means any Person from time to time party to the KEXIM Covered Facility Agreement as a KEXIM
Covered Facility Lender. 
 “KEXIM Direct Facility Agreement” means the facility agreement dated as of June 30, 2015,
by and among the Company, the KEXIM Facility Agent, the Common Security Trustee and KEXIM. 
 “KEXIM Facility Agent” means
Shinhan Bank, New York Branch, not in its individual capacity, but solely as agent for KEXIM under the KEXIM Direct Facility Agreement and for the KEXIM Covered Facility Lenders under the KEXIM Covered Facility Agreement. 

“KoGas” means Korea Gas Corporation. 

“KoGas FOB Sale and Purchase Agreement” means the LNG Sale and Purchase Agreement (FOB), dated January 30, 2012, between
the Company and KoGas, as amended from time to time, and, subject to the provisions of Sections 6.01(6) and 6.01(8), any replacements thereof entered into with the required approval of the Required Secured Parties or, at any time when
there is no Secured Bank Debt outstanding, any replacements thereof meeting the requirements of Section 4.20. 

“KSURE” means Korea Trade Insurance Corporation, a governmental financial institution of the Government of the Republic of
Korea. 
 “KSURE Covered Facility Agent” means The Korea Development Bank, New York Branch, not in its individual capacity,
but solely as agent for the KSURE Covered Facility Lenders under the KSURE Covered Facility Agreement. 
 “KSURE Covered Facility
Agreement” means the facility agreement dated June 30, 2015 by and among the Company, the KSURE Covered Facility Agent, the Common Security Trustee and the KSURE Covered Facility Lenders. 

  
 28 

 “KSURE Covered Facility Lenders” means any Person from time to time party to the
KSURE Covered Facility Agreement as a KSURE Covered Facility Lender. 
 “Lease Agreements” means: 

(a) that certain real property lease agreement between Crain Lands, LLC, as lessor, and the Company, as lessee, dated December 5, 2011,
covering approximately 80 acres of the Site; and 
 (b) that certain real property lease agreement between Crain Lands, LLC, as lessor, and
the Company, as lessee, dated November 1, 2011, covering approximately 80 acres of the Site, 
 both as may be amended or supplemented from time to
time. 
 “Lien” means, with respect to any Property (including, without limitation, the Project) of any Person, any
mortgage, pledge, hypothecation, assignment, encumbrance, bailment, lien, privilege or other security interest, including any sale-leaseback arrangement, any conditional sale, other title retention agreement, tax lien, lien (statutory or otherwise),
easement or right of way in respect of such Property of such Person. For purposes of the Financing Documents, a Person shall be deemed to own subject to a Lien any Property which it has acquired or holds subject to the interest of a vendor or lessor
under any conditional sale agreement, capital lease or other title retention agreement (other than an operating lease) relating to such Property. 

“LNG” means Gas in a liquid state at or below its boiling point at a pressure of approximately one atmosphere. 

“Loan Parties” means the Company and the Pledgor. 

“Majority Aggregate Other Secured Debt Participants” means, at any time with respect to any decision, the Designated Voting
Parties under any one or more Secured Debt Instruments that constitute all or part of the Other Secured Debt that, when their allotted votes are cast pursuant to Section 3.3 (Intercreditor Votes; Each Party’s Entitlement to Vote) of
the Intercreditor Agreement and Section 3.4 (Casting of Votes) of the Intercreditor Agreement, exceed 50% of the votes eligible to be cast by such Designated Voting Parties regarding such decision; provided, however, that a
Modification that has been the subject of a Rating Affirmation shall be deemed to have been approved by votes cast pursuant to Section 3.3 (Intercreditor Votes; Each Party’s Entitlement to Vote) of the Intercreditor Agreement and
Section 3.4 (Casting of Votes) of the Intercreditor Agreement, exceeding 50% of the votes eligible to be cast by such Designated Voting Parties regarding the Modification that has been the subject of such Rating Affirmation. 

“Majority Aggregate Secured Bank Debt Participants” means, at any time with respect to any decision, the Designated Voting
Parties under any one or more Secured Debt Instruments that constitute all or part of the Aggregate Secured Bank Debt that, when their allotted votes are cast pursuant to Section 3.3 (Intercreditor Votes; Each
Party’s Entitlement to Vote) of the Intercreditor Agreement and Section 3.4 (Casting of Votes) of the Intercreditor Agreement, exceed 50% of the votes eligible to be cast by such Designated Voting Parties regarding
such decision. 

  
 29 

 “Majority Aggregate Secured ECA Debt Participants” means, at any time with
respect to any decision, the Designated Voting Parties under any one or more Secured Debt Instruments that constitute all or part of the Aggregate Secured ECA Debt that, when their allotted votes are cast pursuant to the Intercreditor Agreement,
exceed 50% of the votes eligible to be cast by such Designated Voting Parties regarding such decision. 
 “Majority Secured Debt
Participants” means, at any time with respect to any relevant decision, the Designated Voting Parties under any one or more Secured Debt Instruments that, when their allotted votes are cast pursuant to Section 3.3 (Intercreditor
Votes; Each Party’s Entitlement to Vote) of the Intercreditor Agreement and Section 3.4 (Casting of Votes) of the Intercreditor Agreement, exceed 50% of the votes eligible to be cast by all Designated Voting Parties regarding
such decision; provided, however, that a Modification that has been the subject of a Rating Affirmation shall be deemed to have been approved by votes cast pursuant to Section 3.3 (Intercreditor Votes; Each Party’s Entitlement to
Vote) of the Intercreditor Agreement and Section 3.4 (Casting of Votes) of the Intercreditor Agreement, exceeding 50% of the votes eligible to be cast by such Designated Voting Parties regarding the Modification that has been the
subject of such Rating Affirmation. 
 “Management Services Agreement” means the Management Services Agreement, dated as of
May 14, 2012, between the Company and Cheniere LNG Terminals, Inc., as amended from time to time. 
 “Manager” means
Cheniere LNG Terminals, Inc., a Delaware corporation. 
 “Market Consultant” means Wood Mackenzie Limited and any
replacement thereof appointed by the Required Secured Parties and, if no CTA Event of Default shall then be occurring, after consultation with the Company. 

“Material Adverse Effect” means an act, event or condition which materially impairs (a) the business, financial
condition, or operations of the Company or the Project, (b) the ability of the Company to perform its material obligations under any Financing Document or Material Project Document to which it is a party, (c) the validity and
enforceability of any Material Project Document or any Financing Document or the rights or remedies of each Secured Debt Holder thereunder or (d) the security interests of the Secured Parties. 

“Material Project Document” means: 

(a) the Train One and Train Two EPC Contract, the Train Three and Train Four EPC Contract, the Train Five EPC Contract, and related parent
guarantees; 

  
 30 

 (b) the FOB Sale and Purchase Agreements and related parent guarantees; 

(c) the Sabine Liquefaction TUA; 

(d) the Pipeline Transportation Agreements; 

(e) the Terminal Use Rights Assignment and Agreement; 

(f) the Cooperation Agreement; 

(g) the Real Property Documents; 

(h) the Precedent Agreements; 

(i) the ConocoPhillips License Agreements; 

(j) the Water Agreement; 
 (k)
any Additional Material Project Document; 
 (l) if the Company incurs Expansion Debt in respect of Train Six pursuant, as applicable, to
Section 4.08(a)(1), any Train Six LNG Sales Agreements, as applicable, and with respect to Train Six any agreement or license having substantially the same purpose as the Material Project Documents set forth in clauses (a) and
(i) above in this definition; and  
 (m) any agreement replacing or in substitution of any of the foregoing. 

“Material Project Party” means each party to a Material Project Document (other than the Company) and each guarantor or
provider of security or credit support in respect thereof. 
 “Mechanics’ Liens” means carriers’,
warehousemen’s, laborers’, mechanics’, workmen’s, materialmen’s, repairmen’s, construction or other like statutory Liens. 

“Modification” means, with respect to any Financing Document, any amendment, supplement, Waiver or other modification of the
terms and provisions thereof and the term “Modify” shall have a corresponding meaning. 
 “Monthly Sales Charges”
with respect to any of the FOB Sale and Purchase Agreements, has the meaning set forth in such FOB Sale and Purchase Agreement. 

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

“Mortgage” means the Amended and Restated Multiple Indebtedness Mortgage, Assignment of Leases and Rents and Security
Agreement, dated July 28, 2012, and effective July 31, 2012, from the Company to the Common Security Trustee. 

  
 31 

 “Net Cash Proceeds” means in connection with any asset disposition, the
aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any asset disposition (including any cash received upon the sale or other disposition of any non-cash
consideration received in any asset disposition), net of the direct costs relating to such asset disposition and payments made to retire Indebtedness (other than the Obligations) required to be repaid in connection therewith, including legal,
accounting and investment banking fees, and sales commissions, and any relocation expenses incurred as a result of such asset disposition, taxes paid or payable as a result of such asset disposition, in each case, after taking into account any
available tax credits or deductions and any tax sharing arrangements, and amounts reserved for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP. 

“Net Loss Proceeds” means Insurance Proceeds, Condemnation Proceeds and all Performance Liquidated Damages. 

“NGA” means the United States Natural Gas Act of 1938, as heretofore and hereafter amended, and codified 15 U.S.C. §717
et seq. 
 “NGPL Pipeline Transportation Agreements” means (i) the Transportation Rate Schedule FTS Agreement, dated
October 29, 2012, between Natural Gas Pipeline Company of America LLC and the Company, as amended by that certain Transportation Rate Schedule FTS Amendment No. 1, dated June 18, 2013 and (ii) Transportation Rate Schedule FTS
Agreement, dated June 18, 2013, between Natural Gas Pipeline Company of America LLC and the Company. 
 “Non-Recourse Debt” means Indebtedness: 
 (a) as to which neither the Company nor any of its
Restricted Subsidiaries (1) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness) or (2) is directly or indirectly liable as a guarantor or otherwise; and 

(b) as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Company or any of
its Restricted Subsidiaries (other than the Equity Interests of an Unrestricted Subsidiary). 

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

“Notarial Assignment” means the Notarial Act of Assignment, dated July 31, 2012, by the Parent in favor of the Common
Security Trustee for the benefit of the Secured Parties of (i) that certain Revolving Credit Note in the amount of $100,000,000, dated June 11, 2012, made by the Company, payable to the order of the Parent, (ii) that certain Multiple
Indebtedness Mortgage, Assignment of Rents and Leases, and Security Agreement, executed by the Company, as mortgagor, to and in favor of the Parent, as mortgagee, dated effective June 11, 2012, and recorded in the Official Records of Cameron
Parish, Louisiana on June 11, 2012, under File No. 

  
 32 

 
326265, relating to that property in Cameron Parish, Louisiana described therein, and (iii) that certain UCC-1 Financing Statement filed in the
Official Records of Cameron Parish, Louisiana on June 11, 2012 under File No. 12-326266. 

“Note Guarantee” means the Guarantee by each Guarantor of the Company’s obligations under this Indenture and the Notes,
executed pursuant to the provisions of this Indenture. 
 “Notes” means the Initial Notes and any Additional Notes, unless
the context otherwise requires. 
 “Notes Issue Date” means the first date of the original issuance of the Initial Notes
under this Indenture. 
 “O&M Agreement” means the Operation and Maintenance Agreement, dated as of May 14, 2012,
between the Operator, the Company and, solely for the purposes set forth therein, Cheniere LNG O&M Services, LLC, as amended from time to time. 

“Obligations” means and includes all loans, advances (including, without limitation, any advance made by any Secured Party to
satisfy any obligation of any Loan Party under any Transaction Document), debts, liabilities, Indebtedness and obligations of the Company, howsoever arising, owed to the Secured Debt Holders, the Secured Debt Holder Group Representatives, the Senior
Debt Holders of Secured Hedge Obligations, the Secured Hedge Representatives or any other Secured Party of every kind and description (whether or not evidenced by any note or instrument and whether or not for the payment of money), 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 the Company of any insolvency or
liquidation proceeding naming the Company as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding, pursuant to the terms of the Common Terms Agreement or any of the other Financing
Documents (including the Secured Hedge Instruments), including all principal, interest, fees, charges, expenses, attorneys’ fees, costs and expenses, accountants’ fees and Consultants’ fees payable by the Company thereunder. 

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury. 

“Officer’s Certificate” means a certificate signed by one Authorized Officer of the Company, which officer must be the
principal executive officer, the principal financial officer, the treasurer or the principal accounting officer, that meets the requirements of Section 13.03. 

“One Hundred Percent Participants” means, at any time with respect to any decision, the Designated Voting Parties that, when
their allotted votes are cast pursuant to Article 3 (Voting and Decision-Making) of the Intercreditor Agreement, equal 100% of the votes eligible to be cast regarding such decision. 

  
 33 

 “Operating Account” means the Operating Account so designated, established and
created by the Accounts Bank pursuant to the Accounts Agreement. 
 “Operating Budget” means a proposed operating plan and
a budget setting forth in reasonable detail the projected requirements for Operation and Maintenance Expenses for the Company and the Project for the ensuing calendar year (or, in the case of the initial Operating Budget, the remaining portion
thereof). 
 “Operation and Maintenance Expenses” means, for any period, the sum, computed without duplication, of the
following, in each case that are contemplated by the then-effective Operating Budget or are incurred in connection with any permitted exceedance thereunder pursuant to the Common Terms Agreement: 

(a) for fees and costs of the Manager pursuant to the Management Services Agreement; plus 

(b) expenses for operating the Project and maintaining it in good repair and operating condition payable during such period, including the
ordinary course fees and costs of the Operator payable pursuant to the O&M Agreement; plus 
 (c) insurance costs payable during
such period; plus 
 (d) applicable sales and excise taxes (if any) payable or reimbursable by the Company during such period;
plus 
 (e) franchise taxes payable by the Company during such period; plus 

(f) property taxes payable by the Company during such period; plus 

(g) any other direct taxes (if any) payable by the Company to the taxing authority (other than any taxes imposed on or measured by income or
receipts) during such period; plus 
 (h) costs and fees attendant to the obtaining and maintaining in effect the Government
Approvals payable during such period; plus 
 (i) legal, accounting and other professional fees attendant to any of the foregoing
items payable during such period; plus 
 (j) Permitted Capital Expenditures contemplated by the then-effective Operating Budget;
plus 
 (k) the cost of purchase and transportation (including storage) of natural gas consumed for LNG production; plus 

  
 34 

 (l) all other cash expenses payable by the Company in the ordinary course of business. Operation
and Maintenance Expenses shall exclude any Gas Hedge Termination Value and shall exclude, to the extent included above: (i) transfers from any Account into any other Account (other than the Operating Account) during such period,
(ii) payments of any kind with respect to Restricted Payments during such period, (iii) depreciation for such period, (iv) except as provided in clause (j) above, any Capital Expenditure including Permitted Capital Expenditures
and (v) any payments of any kind with respect to any restoration during such period. 
 To the extent insufficient funds are available
in the Operating Account to pay any Operation and Maintenance Expenses and amounts are advanced by or on behalf of any Secured Party in accordance with the terms of the applicable Secured Debt Instrument or Secured Hedge Instrument for the payment
of such Operation and Maintenance Expenses, the Obligation to repay such advances shall itself constitute an Operation and Maintenance Expense. 

“Operator” means Cheniere Energy Investments, LLC, or such other Person from time to time party to the O&M Agreement as
“Operator.” 
 “Opinion of Counsel” means an opinion or opinions from legal counsel who is reasonably acceptable
to the Trustee, that meets the requirements of Section 13.03. The counsel may be an employee of, or counsel to, the Company, any Subsidiary of the Company or the Trustee. 

“Other Secured Debt” means any Secured Debt other than (a) the Secured Bank Debt and (b) any Additional Secured
Debt which constitutes one or more commercial loans made pursuant to one or more credit facilities in which the lenders are primarily financial institutions engaged in the business of banking. 

“Parent” means Cheniere Energy Partners, L.P., a Delaware limited partnership. 

“Participant” means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the
Depositary, Euroclear or Clearstream, respectively (and, with respect to DTC, shall include Euroclear and Clearstream). 
 “Payment
Date” means March 15 and September 15 of each year, commencing on September 15, 2017 (as set forth in the Payment Schedule), or if any such day is not a Business Day, the next succeeding Business Day. 

“Payment Schedule” means the payment and amortization schedule attached hereto as Appendix B, as the same may be adjusted
from time to time in accordance with the terms of this Indenture. 
 “PDE Debt” has the meaning assigned to such term in
Section 2.5 of the Common Terms Agreement. 

  
 35 

 “Performance Liquidated Damages” means any liquidated damages resulting from the
Project’s performance which are required to be paid by the EPC Contractor or any other Material Project Party for or on account of any diminution to the performance of the Project. 

“Permitted Business” means (i) the construction, operation, expansion, reconstruction, debottlenecking, improvement and
maintenance of the Project or related to or using by-products of the Project, all activity reasonably necessary or undertaken in connection with the foregoing and any activities incidental or related to any of
the foregoing, including, the development, construction, operation, maintenance and financing of any facilities reasonably related to the Project or related to or using by-products of the Project and
(ii) the buying, selling, storing and transportation of hydrocarbons for use in connection with the Project or related to or using by-products of the Project. 

“Permitted Capital Expenditures” means Capital Expenditures that: (a) are required for compliance with Project
Documents, insurance policies, Government Rules, Government Approvals and Prudent Industry Practices; or (b) are otherwise used for the Project or for the development, construction, financing and operation of additional Trains; and in all
cases, (i) are funded by equity or Permitted Indebtedness issued by the Company, (ii) are funded from the Distribution Account as set forth in Section 5.10 (Distribution Account) of the Accounts Agreement, (iii) are funded
by insurance proceeds, each of (i), (ii) or (iii) as expressly permitted herein and the other Financing Documents and to the extent that all such sums entirely fund such Permitted Capital Expenditures, or (iv) are contemplated by the
then-effective Operating Budget, and, in the case of clauses (i), (ii) or (iii), could not reasonably be expected to have a Material Adverse Effect or materially and adversely affect the Borrower’s rights, duties, obligations or liabilities
under the Sabine Liquefaction TUA. 
 “Permitted Holder” means (i) Cheniere Energy, Inc. and its Affiliates and
(ii) Blackstone and its Affiliates. 
 “Permitted Hedging Agreement” means any of the: 

(a) Interest Rate Protection Agreements; and 

(b) gas hedging contracts in an amount and for a period not to exceed the amount reasonably required by the Company to comply with its
obligations under the Facility LNG Sale and Purchase Agreements and its other contractual obligations. 
 “Permitted
Indebtedness” means items (a) through (r) set forth in Section 4.08. 
 “Permitted
Investments” means: 
 (a) any Investment in the Company or in a Restricted Subsidiary of the Company that is a Guarantor and that
is engaged in a Permitted Business; 

  
 36 

 (b) any Investment in Cash Equivalents; 

(c) any Investment by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment: 

(1) such Person becomes a Restricted Subsidiary of the Company; or 

(2) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets
to, or is liquidated into, the Company or a Restricted Subsidiary of the Company; 
 (d) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with Section 4.09; 

(e) any Investment in any Person solely in exchange for the issuance of Equity Interests (other than Equity Interests that constitute
Indebtedness) of the Company or any of its Subsidiaries; 
 (f) any Investments received in compromise or resolution of (A) obligations
of trade creditors or customers that were incurred in the ordinary course of business of the Company or any of its Restricted Subsidiaries, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of
any trade creditor or customer; or (B) litigation, arbitration or other disputes with Persons who are not Affiliates; 
 (g)
Investments pursuant to Hedging Agreements entered into in the ordinary course of business and not for speculative purposes; 
 (h) advances
to or reimbursements of employees for moving, entertainment and travel expenses, drawing accounts and similar expenditures in the ordinary course of business; 

(i) loans or advances to employees made in the ordinary course of business of the Company or any Restricted Subsidiary of the Company in an
aggregate principal amount not to exceed $2.5 million at any one time outstanding; 
 (j) repurchases of the Notes; 

(k) advances, deposits and prepayments for purchases of any assets, including any Equity Interests; 

(l) advances to customers or suppliers in the ordinary course of business that are, in conformity with GAAP, recorded as accounts receivable,
prepaid expenses or deposits on the balance sheet of the Company or its Restricted Subsidiaries and endorsements for collection or deposit arising in the ordinary course of business; 

  
 37 

 (m) receivables owing to the Company or any Restricted Subsidiary created or acquired in the
ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary
deems reasonable under the circumstances; 
 (n) Investments received as a result of a foreclosure by the Company or any of its Restricted
Subsidiaries with respect to any secured Investment in default; 
 (o) surety and performance bonds and workers’ compensation, utility,
lease, tax, performance and similar deposits and prepaid expenses in the ordinary course of business, including cash deposits incurred in connection with natural gas purchases; 

(p) Guarantees of Indebtedness permitted under Section 4.08; 

(q) Investments existing on the Notes Issue Date; and 

(r) other Investments in any Person having an aggregate Fair Market Value (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (r) that are at the time outstanding not to exceed $50.0 million. 

“Permitted Liens” means, collectively: 

(a) Liens in favor, or for the benefit, of the Secured Parties created or permitted pursuant to the Security Documents; 

(b) Liens securing Indebtedness with respect to Permitted Hedging Agreements and Secured Bank Debt permitted to be incurred under this
Indenture; 
 (c) Liens which are scheduled exceptions to the coverage afforded by the Title Policy on the Initial Senior Secured Debt
Closing Date; 
 (d) statutory liens for a sum not yet delinquent or which are being Contested; 

(e) pledges or deposits of cash or letters of credit to secure the performance of bids, trade contracts (other than for borrowed money)
leases, statutory obligations, surety and appeal bonds, performance bonds, letters of credit and other obligations of a like nature incurred in the ordinary course of business and in accordance with the then-effective Operating Budget and cash
deposits incurred in connection with natural gas purchases; 
 (f) Liens to secure Indebtedness (including Capital Lease Obligations)
permitted by Section 4.08(e) covering only the assets acquired with or financed by such Indebtedness; 

  
 38 

 (g) easements and other similar encumbrances affecting real property which are incurred in the
ordinary course of business and encumbrances consisting of zoning restrictions, licenses, restrictions on the use of property or encumbrances or imperfections in title which do not materially impair such property for the purpose for which the
Company’s interest therein was acquired or materially interfere with the operation of the Project as contemplated by the Transaction Documents; 

(h) Mechanics’ Liens, Liens of lessors and sublessors and similar Liens incurred in the ordinary course of business for sums which are
not overdue for a period of more than 30 days or the payment of which is subject to a Contest; 
 (i) legal or equitable encumbrances (other
than any attachment prior to judgment, judgment lien or attachment in aid of execution on a judgment) deemed to exist by reason of the existence of any pending litigation or other legal proceeding if the same is effectively stayed or the claims
secured thereby are subject to a Contest; 
 (j) the Liens created pursuant to the Real Property Documents; 

(k) Liens arising out of judgments or awards so long as an appeal or proceeding for review is being prosecuted in good faith and for the
payment of which adequate cash reserves, bonds or other cash equivalent security have been provided or are fully covered by insurance (other than any customary deductible); 

(l) Liens for workers’ compensation awards and similar obligations not then delinquent; Mechanics’ Liens and similar Liens not then
delinquent, and any such Liens, whether or not delinquent, whose validity is at the time being Contested in good faith; 
 (m) Liens in
favor of the Company or the Guarantors; 
 (n) Liens to secure any Permitted Refinancing Indebtedness permitted to be incurred under this
Indenture; provided, however, that: 
 (1) the new Lien is limited to all or part of the same property and
assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to, such property or proceeds or distributions thereof); and 

(2) the Indebtedness secured by the new Lien is not increased to any amount greater than the sum of (x) the outstanding
principal amount, or, if greater, committed amount, of the Indebtedness renewed, refunded, refinanced, replaced, defeased or discharged (plus all accrued interest on the Indebtedness, any amounts deposited in a debt service reserve or similar
reserve account in connection with the issuance of such Permitted Refinancing Indebtedness and the amount of all fees and expenses (including Hedge Termination Value with respect to any Interest Rate Protection subject to

  
 39 

 
refinancing with the purposed Permitted Refinancing Indebtedness), including premiums, incurred in connection therewith) with such Permitted Refinancing Indebtedness and (y) an amount
necessary to pay any fees and expenses, including premiums, discounts, related to such renewal, refunding, refinancing, replacement, defeasance or discharge; and 

(o) other Liens not otherwise permitted hereunder so long as the aggregate outstanding principal amount of the obligations secured thereby
does not exceed $100,000,000 at any one time. 
 “Permitted Modification” means, with respect to any Secured Debt
Instrument, the following: 
 (a) subject to Section 4.1 (Majority Decisions) and 4.2 (Unanimous Decisions) of the
Intercreditor Agreement any Modifications of or under such Secured Debt Instrument (provided that such Modification shall not (x) adversely affect the rights or interests of any Secured Party not party to such Secured Debt Instrument or
(y) change or attempt to change the effect of Sections 4.5(b) or 4.6 of the Intercreditor Agreement; 
 (b) any release of anyone
liable in any manner under, or in respect of the Obligations owing under, such Secured Debt Instrument (but only in respect of such Obligations); and 

(c) any Waiver of, or determination of satisfaction of or compliance with, any condition precedent to any Advance under such Secured Debt
Instrument. 
 “Permitted Payments to Parent” means, without duplication as to amounts allowed to be distributed under any
other provision of this Indenture: 
 (d) payments to the Parent to permit the Parent to pay reasonable accounting, legal and administrative
expenses of the Parent when due, in an aggregate amount not to exceed $5,000,000 per calendar year; and 
 (e) on each Quarterly Payment
Date, the amount necessary for payment to the Pledgor or Parent to enable it to pay its (or for Parent to satisfy any contractual obligation to distribute to its beneficial owners to enable them to pay their) income tax liability with respect to
income generated by the Company, determined at the highest combined U.S. federal and State of Louisiana tax rate applicable to an entity taxable as a corporation in both jurisdictions for the applicable period. 

  
 40 

 “Permitted Refinancing Indebtedness” means any Indebtedness of the Company or
any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge other Indebtedness of the Company or any of its Restricted Subsidiaries (other than
intercompany Indebtedness); provided that: 
 (a) the principal amount (or accreted value, if applicable) of such Permitted
Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness renewed, refunded, refinanced, replaced, defeased or discharged (plus all accrued interest on the Indebtedness, any amounts
deposited in a debt service reserve or similar reserve account in connection with the issuance of such Permitted Refinancing Indebtedness and the amount of all fees and expenses (including Hedge Termination Value with respect to any Interest Rate
Protection subject to refinancing with the purposed Permitted Refinancing Indebtedness), including premiums and discounts incurred in connection therewith); 

(b) such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a weighted average life
to maturity that is (a) equal to or greater than the weighted average life to maturity of, the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged or (b) more than 90 days after the final maturity date of the
Notes; provided that this clause (b) shall not apply to Permitted Refinancing Indebtedness incurred pursuant to Section 4.08(a)(2); 

(c) if the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged is subordinated in right of payment to the
Notes, such Permitted Refinancing Indebtedness is subordinated in right of payment to the Notes on terms at least as favorable to the Holders as those contained in the documentation governing the Indebtedness being renewed, refunded, refinanced,
replaced, defeased or discharged; and 
 (d) such Indebtedness is incurred either by the Company or by the Restricted Subsidiary of the
Company that was the obligor on the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged and is guaranteed only by Persons who were obligors on the Indebtedness being renewed, refunded, refinanced, replaced, defeased or
discharged. 
 “Person” means any individual, corporation, company, voluntary association, partnership, joint venture,
trust, limited liability company, unincorporated organization or Government Authority. 
 “Pipeline” means the
approximately 94 miles of 42-inch diameter pipeline and other facilities as described in the application filed by the Cheniere Creole Trail Pipeline, L.P., pursuant to Section 7(c) of the NGA in FERC
Docket No CP12-351-000 and any expansion thereof used in connection with any Permitted Business. 

“Pipeline Transportation Agreements” means, collectively, the Creole Trail Pipeline Transportation Agreement and the NGPL
Pipeline Transportation Agreements. 
 “Pledge Agreement” means the Pledge Agreement, dated as of July 31, 2012,
between the Pledgor and the Common Security Trustee and any other pledge agreement executed (in favor of the Common Security Trustee) by any Person holding any direct ownership interests in the Company. 

  
 41 

 “Pledgor” means Sabine Pass LNG-LP, LLC,
a Delaware limited liability company. 
 “Precedent Agreements” means collectively (i) the Transportation Precedent
Agreement, dated as of August 6, 2012, between Cheniere Creole Trail Pipeline, L.P. and the Company, as amended by that certain First Amendment to the Transportation Precedent Agreement, dated November 5, 2012, and as further amended by
that certain Second Amendment to the Transportation Precedent Agreement, dated March 11, 2015, (ii) the Precedent Agreement, dated August 2, 2012, between Natural Gas Pipeline Company of America LLC and the Company, and (iii) the
Precedent Agreement, dated March 25, 2015, between Kinder Morgan Louisiana Pipeline LLC and the Company. 
 “Private Placement
Legend” means (a) in the case of the Initial Notes, the legend set forth in Section 2.3(g)(1) of Appendix A and (b) in the case of any Additional Notes any legend required or permitted by Section 2.1(d) of
Appendix A. 
 “Project” means (a) the liquefaction trains, each with a nominal capacity of at least
182,500,000 MMBtu per annum that as of the date hereof, are intended to be used for production of LNG and other Services under the BG FOB Sale and Purchase Agreement, the Centrica FOB Sale and Purchase Agreement, the GN FOB Sale and Purchase
Agreement, the KoGas FOB Sale and Purchase Agreement, the GAIL FOB Sale and Purchase Agreement, the CMI LNG Sale and Purchase Agreement, as applicable, and any other LNG sales contracts with additional purchasers and (b) any other Permitted
Business conducted by the Company. 
 “Project Costs” means all costs of acquiring, leasing, designing, engineering,
developing, permitting, insuring, financing (including closing costs and interest and interest rate hedge expenses), constructing, installing, commissioning, testing and starting-up (including costs relating
to all equipment, materials, spare parts and labor for) the Project and all other costs incurred with respect to the Project, including working capital (provided that Project Costs shall exclude any operation and maintenance expenses for any train
of the Project that has achieved Substantial Completion). 
 “Project Document Termination Payments” means all payments
that are required to be paid to or for the account of the Company as a result of the termination of or reduction of any obligations under any Material Project Document, if any. 

“Project Documents” means each Material Project Document and any other material agreement relating to Development. 

“Projected Debt Service Coverage Ratio” means, for the applicable period, the ratio of (a) Cash Flow Available
for Debt Service projected for such period to (b) Debt Service projected for such period (excluding Working Capital Debt, all Indebtedness or Guarantees incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and
(q) of Section 4.08, and all Indebtedness or Guarantees that would have been permitted to be incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08 of the 2013
Indenture prior to the 

  
 42 

 
Investment Grade Date and the scheduled principal payment of any Senior Debt that has bullet maturities or balloon payments at maturity or in the final year prior to maturity), including Debt
Service projected with respect to any undrawn portion of the Secured Bank Debt Available Amount. Where this Indenture states that the Projected Debt Service Coverage Ratio is to be based on Contracted Cash Flow, the Projected Debt Service Coverage
Ratio shall mean, for any period, the ratio of (a) Contracted Cash Flow Available for Debt Service projected for such period to (b) Debt Service projected for such period (excluding Working Capital Debt, all Indebtedness or Guarantees
incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08, and all Indebtedness or Guarantees that would have been permitted to be incurred pursuant to clauses (f), (g), (h),
(i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08 of the 2013 Indenture prior to the Investment Grade Date and the scheduled principal payment of any Senior Debt that has bullet maturities or balloon payments at maturity or in the
final year prior to maturity), including Debt Service projected with respect to any undrawn portion of the Secured Bank Debt Available Amount. 

“Property” means any right or interest in or to property of any kind whatsoever, whether real, personal, mixed, movable,
immovable, corporeal or incorporeal and whether tangible or intangible. 
 “Prudent Industry Practice” means, at a
particular time, any of the practices, methods, standards and procedures (including those engaged in or approved by a material portion of the LNG industry) that, at that time, in the exercise of reasonable judgment in light of the facts known at the
time a decision was made, would reasonably have been expected to accomplish the desired result consistent with good business practices, including due consideration of the Project’s reliability, environmental compliance, economy, safety and
expedition, and which practices, methods, standards and acts generally conform to International LNG Terminal Standards and International LNG Vessel Standards. 

“QIB” means a “qualified institutional buyer” as defined in Rule 144A. 

“Qualified Counterparty” means: 

(a) as of the date of execution or assignment of any Interest Rate Protection Agreement, any of the following: (i) any Person who is a
Secured Debt Holder as of the date of the Common Terms Agreement or (ii) any Affiliate of any Person listed in the foregoing clause (a)(i) of this definition; and 

(b) as of the date of execution or assignment of any Interest Rate Protection Agreement, any of the following: (i) any Person who is a
Secured Debt Holder after the date of the Common Terms Agreement or (ii) any Affiliate of any Person listed in the foregoing clause (b)(i) of this definition, in each case, with a credit rating (or a guaranty from a Person with a credit
rating) of at least A- from S&P or Fitch or at least A-3 from Moody’s (or, if any of such entities cease to provide such ratings, the equivalent credit rating
from any other Acceptable Rating Agency). 

  
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 “Quarterly Payment Date” means each March 31, June 30,
September 30 and December 31. 
 “Rating Affirmation” means, with respect to any Modification, delivery by the
Company to the Intercreditor Agent of letters from any two Recognized Credit Rating Agencies that are then rating Other Secured Debt (or if only one Recognized Credit Rating Agency is then rating Other Secured Debt, that Recognized Credit Rating
Agency) to the effect that the Recognized Credit Rating Agency has considered the contemplated Modification and that, if the contemplated Modification is adopted, such Recognized Credit Rating Agency would reaffirm (or upgrade) the rating of the
Other Secured Debt as of the date of the request for a Rating Affirmation. 
 “Real Property Documents” means any material
contract or agreement constituting or creating an estate or interest in any portion of the Site, including, without limitation, the Lease Agreements and the Sublease. 

“Recognized Credit Rating Agency” means S&P, Fitch, Moody’s, or any successor to S&P, Fitch, Moody’s, so
long as such agency is a “nationally recognized statistical rating organization” registered with the SEC. 
 “Regulation
S” means Regulation S promulgated under the Securities Act. 
 “Regulation S Global Note” means a Regulation S
Temporary Global Note or Regulation S Permanent Global Note, as appropriate. 
 “Regulation S Permanent Global Note” means
a permanent Global Note issued in accordance with the second paragraph of Section 2.1(c) of Appendix A. 
 “Regulation
S Temporary Global Note” means a temporary Global Note issued in accordance with the first paragraph of Section 2.1(c) of Appendix A. 

“Replacement Assets” means (a) non-current assets that will be used or useful in
a Permitted Business or (b) substantially all the assets of a Permitted Business or a majority of the voting stock of any Person engaged in a Permitted Business that will become on the date of acquisition thereof a Restricted Subsidiary. 

“Replacement Debt” means, collectively, Secured Replacement Debt and Unsecured Replacement Debt incurred by the Company
(including by way of Senior Bonds) pursuant to the Common Terms Agreement in order to partially or in whole (a) refinance by prepaying or redeeming then existing Senior Debt or (b) replace by cancelling then existing Senior Debt
Commitments. For the avoidance of doubt, the Notes constitute Replacement Debt for purposes of the Financing Documents. 

  
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 “Required Secured Parties” means: 

(a) except as otherwise provided in clauses (b) through (e) below, with respect to any Covered Action, Designated Voting Parties
constituting the Majority Aggregate Secured Credit Facilities Debt Participants; 
 (b) in the case of any Covered Action subject to
Section 4.1 (Majority Decisions) of the Intercreditor Agreement, Designated Voting Parties constituting the Majority Aggregate Secured Bank Debt Participants, the Majority Aggregate Secured ECA Debt Participants, the Majority Aggregate
Other Secured Debt Participants or the Majority Secured Debt Participants, as applicable, set forth in that Section; 
 (c) Designated
Voting Parties constituting the One Hundred Percent Participants with respect to any Covered Action that is subject to Section 4.2 (Unanimous Decisions) of the Intercreditor Agreement; 

(d) Designated Voting Parties constituting the Majority Secured Debt Participants with respect to any decision to exercise remedies made
pursuant to Section 5.3 (Election to Pursue Remedies) of the Intercreditor Agreement, except as otherwise provided in Section 5.3(g) of the Intercreditor Agreement; and 

(e) Designated Voting Parties constituting the Majority Secured Debt Participants (1) if no Secured Bank Debt is outstanding or
(2) with respect to any other action not otherwise described or dealt with in this definition of “Required Secured Parties” and not otherwise specifically delegated to the Intercreditor Agent, the Common Security Trustee or a Secured
Debtholder Group Representative pursuant to Section 4.3 (Administrative Decisions) of the Intercreditor Agreement. 

“Responsible Officer,” when used with respect to the Trustee, means any officer within the Corporate Trust Division -
Corporate Finance Unit of the Trustee (or any successor division or unit of the Trustee) located at the Corporate Trust Office of the Trustee, who has direct responsibility for the administration of this Indenture and also means, in the case of
Section 7.01(c)(2) and the second sentence of Section 7.05, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject. 

“Restricted Definitive Note” means a Definitive Note bearing the Private Placement Legend. 

“Restricted Global Note” means a Global Note bearing the Private Placement Legend. 

“Restricted Payment” with respect to any Person means (a) any dividend or other distribution (in cash, Property of such
Person, securities, obligations, or other property) on, or other dividends or distributions on account of, its Capital Stock (other than dividends or distributions payable solely to the Company or any of its Restricted Subsidiaries), (b) the
setting 

  
 45 

 
apart of money for a sinking or other analogous fund for, or the purchase, redemption, retirement or other acquisition by such Person of any portion of any of the Capital Stock of the Company or
any direct or indirect parent of the Company, (c) all payments (in cash, Property of such Person, securities, obligations, or other property) of principal of, interest on and other amounts with respect to, or other payments on account of, or
the setting apart of money for a sinking or other analogous fund for, or the purchase, redemption, retirement or other acquisition by such Person of, any Indebtedness owed to the Pledgor or any other Person party to a Pledge Agreement or any
Affiliate thereof (including any Subordinated Indebtedness incurred to fund the Equity Contribution Amount), and (d) the setting apart of money for a sinking or other analogous fund for, or the purchase, redemption, retirement or other
acquisition by such Person of Subordinated Indebtedness (other than from the Company or a Restricted Subsidiary of the Company, and other than within one year of the fixed date on which the final payment of principal thereof is due and payable). For
the avoidance of doubt, payments to the Manager for fees and costs pursuant to the Management Services Agreement, and payments to the Operator pursuant to the O&M Agreement paid in accordance with the Accounts Agreement and Permitted Payments to
Parent are not Restricted Payments. 
 “Restricted Payment Date” means, with respect to any specific Restricted Payment,
the date such Restricted Payment is made. 
 “Restricted Period” means the 40-day
distribution compliance period as defined in Regulation S. 
 “Restricted Subsidiary” of a Person means any Subsidiary of
the referent Person that is not an Unrestricted Subsidiary. 
 “Revenue Account” means the Revenue Account so designated,
established and created by the Accounts Bank pursuant to the Accounts Agreement. 
 “Rule 144” means Rule 144 promulgated
under the Securities Act. 
 “Rule 144A” means Rule 144A promulgated under the Securities Act. 

“Rule 144A Global Note” means a Global Note issued in accordance with Section 2.1(c)(1)(A) of Appendix A. 

“Rule 903” means Rule 903 promulgated under the Securities Act. 

“Rule 904” means Rule 904 promulgated under the Securities Act. 

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

  
 46 

 “Sabine Liquefaction TUA” means the Second Amended and Restated LNG Terminal Use
Agreement, dated as of July 31, 2012, between the Company and SPLNG, as amended from time to time. 
 “Secured Bank
Debt” means Indebtedness incurred by the Company in the aggregate amount of up to $3,626,000,000 pursuant to the Term Loan A Credit Agreement comprised of the Construction/Term Loans, and any amendments, supplements, modifications,
extensions, renewals, restatements, replacements, refundings or refinancings thereof with banks or other institutional lenders or investors that replace, refund or refinance any part of the loans or commitments thereunder; provided that, any
such replacements, refundings or refinancings shall be subject to Section 4.08(a)(2). 
 “Secured Bank Debt Available
Amount” means the amount of all outstanding Secured Bank Debt plus available and undrawn commitments for any Secured Bank Debt pursuant to the applicable Secured Debt Instruments. 

“Secured Bank Debt Committed Amount” means $3,626,000,000. 

“Secured Bank Debt Holders” means, at any time, the Senior Debt Holders of the Secured Bank Debt and shall also include any
indebtedness issued to or guaranteed by an export credit agency or institution serving a similar function. 
 “Secured
Debt” means the Senior Debt (other than Indebtedness under Interest Rate Protection Agreements) that is secured by a Security in the Collateral pursuant to the Security Documents. 

“Secured Debt Holder Group” means, at any time, the Senior Debt Holders of each tranche of Secured Debt. 

“Secured Debt Holder Group Representative” means, (a) the Term Loan A Administrative Agent in respect of the Secured
Bank Debt Holders and Secured Bank Debt, (b) the Trustee and (c) with respect to any other Secured Debt Holder Group and its relevant Secured Debt Instrument, the representative designated as such pursuant to the Common Terms Agreement.

 “Secured Debt Holders” means, at any time, the Senior Debt Holders of the Secured Debt. 

“Secured Debt Instrument” means, at any time, each instrument governing Secured Debt and designated as such pursuant to the
Common Terms Agreement. 
 “Secured ECA Debt” means the Indebtedness under (i) the KEXIM Covered Facility Agreement,
(ii) the KEXIM Direct Facility Agreement and (iii) the KSURE Covered Facility Agreement. 
 “Secured Expansion
Debt” means the Expansion Debt that is Secured Debt. 

  
 47 

 “Secured Gas Hedge Representative” means the representative or representatives
of the Gas Hedge Providers designated as such pursuant to the Common Terms Agreement. 
 “Secured Hedge Instrument” means,
at any time, each instrument governing Secured Hedge Obligations and designated as such in pursuant to the Common Terms Agreement. 

“Secured Hedge Obligations” means the Indebtedness under Interest Rate Protection Agreements that is secured by a Security in
the Collateral pursuant to the Security Documents. 
 “Secured Hedge Representative” means the representative or
representatives of the Senior Debt Holders of Secured Hedge Obligations designated as such pursuant to the Common Terms Agreement. 

“Secured Parties” means the Secured Debt Holders, the Senior Debt Holders of Secured Hedge Obligations, the Gas Hedge
Providers, the Common Security Trustee, the Intercreditor Agent, the Accounts Bank, the Trustee, the applicable Secured Debt Holder Group Representatives, Secured Hedge Representatives and Secured Gas Hedge Representatives, in each case, in whose
favor the Company has granted Security in the Collateral pursuant to the Security Documents. 
 “Secured PDE Debt” means
the PDE Debt that is Secured Debt. 
 “Secured Replacement Debt” means the Replacement Debt that is Secured Debt. 

“Secured Train 6 Debt” means Train 6 Debt which is Secured Debt. 

“Secured Working Capital Debt” means the Working Capital Debt that is Secured Debt. 

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

“Security” means the security interest created in favor of the Common Security Trustee for the benefit of the Secured Parties
pursuant to the Security Documents. 
 “Security Agency Agreement” means the Security Agency Agreement, dated as of
July 31, 2012, among the Company, the Secured Debt Holder Group Representatives, the Secured Hedge Representatives, the Secured Gas Hedge Representatives, the Common Security Trustee, the Accounts Bank and the Intercreditor Agent. 

“Security Agreement” means the Amended and Restated Security Agreement, dated as of June 30, 2015, between the Company
and the Common Security Trustee. 
 “Security Documents” means: 

(a) the Security Agreement; 

(b) the CQP Security Agreement; 

  
 48 

 (c) the Accounts Agreement; 

(d) each Pledge Agreement; 
 (e)
the Mortgage; 
 (f) the Consents; and 

(g) any such other security agreement, control agreement, patent and trademark assignment, lease, mortgage, assignment and other similar
agreement securing the Obligations between any Person and the Common Security Trustee on behalf of the Secured Parties or between any Person and any other Secured Party and all financing statements, agreements or other instruments to be filed in
respect of the Liens created under each such agreement. 
 “Senior Bonds” means debt securities, including the Notes,
issued pursuant to an indenture that is a Senior Debt Instrument. 
 “Senior Debt” means: 

(a) Secured Bank Debt; 
 (b)
Additional Secured Debt; 
 (c) the Unsecured Replacement Debt; 

(d) the Unsecured Expansion Debt; 

(e) the Unsecured Working Capital Debt; 

(f) Indebtedness under Interest Rate Protection Agreements; and 

(g) all other Indebtedness referred to in clauses (a), (b), (c) and (p) of Section 4.08. 

“Senior Debt Commitments” means, at any time, the aggregate of any principal amount that Senior Debt Holders of Senior Debt
are committed to disburse or stated amount of letters of credit that Senior Debt Holders of Senior Debt are required to issue, in each case under any Senior Debt Instrument, and in the case of Senior Debt Commitments in respect of Secured Debt, as
designated pursuant to the Common Terms Agreement. 
 “Senior Debt Instrument” means a Secured Debt Instrument or an
Unsecured Debt Instrument. 
 “Senior Debt Holders” shall be determined by reference to provisions of the relevant Senior
Debt Instrument or Secured Hedge Instrument, as applicable, setting forth who shall be deemed to be lenders, holders or owners of the Senior Debt governed thereby. 

  
 49 

 “Senior Secured Notes Debt Service Reserve Account” means the Senior Secured
Notes Debt Service Reserve Account so designated, established and created by the Accounts Bank pursuant to the Accounts Agreement. 

“Services” means the liquefaction and other services to be provided or performed by the Company under the Facility LNG Sale
and Purchase Agreements and any other agreements entered into in connection with a Permitted Business. 
 “SIGTTO” means
the Society of International Gas Tanker and Terminal Operators. 
 “Site” means, collectively, each parcel or tract of
land, as reflected on Schedule A of the Title Policy and in the Real Property Documents, upon which any portion of the Project is or will be located. 

“SPLNG” means Sabine Pass LNG, L.P., a Delaware limited partnership. 

“Sublease” means the Sub-lease Agreement, dated June 11, 2012, between SPLNG, as
sublessor, and the Company, as sublessee covering approximately 268 acres of the Site. 
 “Subordinated Indebtedness” means
any unsecured Indebtedness of the Company to any Person permitted by Section 4.08(f) which is subordinated to the Obligations pursuant to an instrument in writing satisfactory in form and substance to the Required Secured Parties. 

“Subsidiary” means, for any Person, any corporation, partnership, joint venture, limited liability company or other entity of
which at least a majority of the securities or other ownership interests having by their terms ordinary voting power to elect a majority of the board of directors or other Persons performing similar functions of such corporation, partnership or
other entity (irrespective of whether or not at the time securities or other ownership interests of any other class or classes of such corporation, partnership or other entity shall have or might have voting power by reason of the happening of any
contingency) is at the time directly or indirectly owned or Controlled by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person. 

“Substantial Completion” has the meaning assigned to such term in the applicable EPC Contract. 

“Supplemental Indenture” means any indenture supplemental to this Indenture governing the terms and conditions of any
Additional Notes issued from time to time pursuant to Section 2.1(d) of Appendix A, in each case, to the extent that the Indebtedness evidenced by any Additional Notes, and the terms and conditions of any such Indebtedness, Additional
Notes and Supplemental Indenture, are permitted by this Indenture, including Article 4. 
 “Taxes” means, with
respect to any Person, all taxes, assessments, imposts, duties, governmental charges or levies imposed directly or indirectly on such Person or its income, profits or Property by any Government Authority, including any interest, additions to tax or
penalties applicable thereto. 

  
 50 

 “Term Loan A Administrative Agent” means Société
Générale. 
 “Term Loan A Credit Agreement” means the Credit Agreement (Term Loan A) dated July 31,
2012, by and among the Company, the Term Loan A Administrative Agent, the Common Security Trustee, and the Secured Bank Debt Holders. 

“Terminal Use Rights Assignment and Agreement” means the Terminal Use Rights Assignment and Agreement, dated as of
July 31, 2012, among the Company, SPLNG and Cheniere Energy Investments, LLC, as amended from time to time. 
 “Title
Policy” means the title policy delivered in connection with the closing of the Term Loan A Credit Agreement on the Initial Senior Secured Debt Closing Date. 

“Total FOB Sale and Purchase Agreement” means the LNG Sale and Purchase Agreement (FOB), dated December 14, 2012,
between the Company and Total Gas & Power North America, Inc., as amended from time to time, and any replacements thereof entered into with the required approval of the Required Secured Parties or, at any time when there is no Secured Bank
Debt outstanding, any replacements thereof meeting the requirements of Section 4.20. 
 “Train”
means a “liquefaction train” as such term is used in the definition of “Project.” 
 “Train Five” means
the designated Train under the Train Five LNG Sales Agreement. 
 “Train Five EPC Contract” means the Lump Sum Turnkey
Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Stage 3 Facility, dated as of May 4, 2015, between the Company and the EPC Contractor, as supplemented and amended from time to time. 

“Train Five LNG Sales Agreement” means the Total FOB Sale and Purchase Agreement and any other LNG sale and purchase
agreement entered into by the Company with respect to Train Five and any replacements thereof entered into with the required approval of the Required Secured Parties or, at any time when there is no Secured Bank Debt outstanding, any replacements
thereof meeting the requirements of Section 4.20. 
 “Train Number” means the numbers One through
Six to describe the applicable Train. 
 “Train One and Train Two” means the designated Trains under the Train One and Two
LNG Sales Agreements. 
 “Train One and Train Two EPC Contract” means the Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Sabine Pass LNG Liquefaction Facility, dated as of November 11, 2011, between the Company and the EPC Contractor, as supplemented and amended from time to time. 

  
 51 

 “Train One and Train Two LNG Sales Agreements” means the BG FOB Sale and
Purchase Agreement and the GN FOB Sale and Purchase Agreement. 
 “Train Six” means the Train intended to be the designated
train under the Train Six LNG Sales Agreements. 
 “Train 6 Debt” has the meaning provided in Section 2.7 of the
Common Terms Agreement. 
 “Train Six LNG Sales Agreements” means any LNG sale and purchase agreement entered into by the
Company with respect to the sixth Train of the Project. 
 “Train Three and Train Four” means the designated Trains under
the Train Three and Train Four LNG Sales Agreements. 
 “Train Three and Train Four EPC Contract” means the Lump Sum
Turnkey Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Stage 2 Liquefaction Facility, dated as of December 20, 2012, between the Company and the EPC Contractor, as supplemented and amended from time to time.

 “Train Three and Train Four LNG Sales Agreements” means the GAIL FOB Sale and Purchase Agreement and the KoGas FOB Sale
and Purchase Agreement. 
 “Transaction Documents” means, collectively, the Financing Documents and the Project Documents.

 “Trustee” means The Bank of New York Mellon until a successor replaces it in accordance with the applicable provisions
of this Indenture and thereafter means the successor serving hereunder. 
 “Unanimous Decisions” means each of the items
((a) through (n)) set forth on Schedule 1 to the Intercreditor Agreement. 
 “Uniform Commercial Code” means the Uniform
Commercial Code as in effect from time to time in the State of New York; provided, however, in the event that, by reason of mandatory provisions of law, any or all of the perfection of priority of the security interest in any Collateral is governed
by the Uniform Commercial Code as in effect in any jurisdiction other than the State of New York, the term “Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of
provisions relating to such perfection or priority and for purposes of definitions related to such provisions. 
 “United
States” or “U.S.” means the United States of America. 

  
 52 

 “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. 

“Unrestricted Definitive Note” means a Definitive Note that does not bear and is not required to bear the Private Placement
Legend. 
 “Unrestricted Global Note” means a Global Note that does not bear and is not required to bear the Private
Placement Legend. 
 “Unrestricted Subsidiary” means any Subsidiary of the Company that is designated by the Board of
Directors of the Company as an Unrestricted Subsidiary pursuant to a resolution of the Board of Directors, but only to the extent that such Subsidiary: 

(a) has no Indebtedness other than Non-Recourse Debt; 

(b) is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless
the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company; 

(c) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation
(1) to subscribe for additional Equity Interests or (2) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results; and 

(d) has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any of its
Restricted Subsidiaries. 
 “Unsecured Debt Instrument” means, at any time, each material instrument governing Senior Debt
other than Secured Debt or Secured Hedge Obligations. 
 “Unsecured Expansion Debt” means the Expansion Debt that is not
Secured Debt. 
 “Unsecured Replacement Debt” means the Replacement Debt that is not Secured Debt. 

“Unsecured Working Capital Debt” means the Working Capital Debt that is not Secured Debt. 

“U.S. Person” means a U.S. Person as defined in Rule 902(k) promulgated under the Securities Act. 

  
 53 

 “Waiver” means, with respect to any particular conduct, event or other
circumstance, any change to an obligation of any Person under any Transaction Document requiring the consent of one or more Secured Parties, which consent has the effect of waiving, excusing or accepting or approving changed performance of, or
noncompliance with, such obligation or any Default or CTA Event of Default with respect thereto to the extent relating to such conduct, event or circumstance. 

“Water Agreement” means the Water Service Agreement, dated as of December 21, 2011, between the City of Port Arthur and
the Company, as amended by that certain First Amendment to Water Service Agreement, dated as of June 12, 2012 and that certain Second Amendment to Water Service Agreement, dated as of December 31, 2012, as amended from time to time. 

“Working Capital Debt” means additional senior secured or unsecured Indebtedness the proceeds of which shall be used solely
for working capital and general corporate purposes related to the Project (including the issuance of letters of credit), only if, prior to or on the date of incurrence thereof, the following conditions have been satisfied or waived by the Required
Secured Parties: 
 (a) the Secured Debt Holder Group Representative for any Secured Working Capital Debt shall have entered into an
Accession Agreement in accordance with the Common Terms Agreement; and 
 (b) the Intercreditor Agent shall have received a certificate from
an Authorized Officer of the Company at least five days prior to the incurrence of such Working Capital Debt, in the form set out in the Common Terms Agreement, which certificate shall (a) identify each Secured Debt Holder Group Representative
and each Senior Debt Holder for any Secured Working Capital Debt; (b) attach a copy of each proposed Senior Debt Instrument relating to the Working Capital Debt (that may be an amendment to an existing Senior Debt Instrument), which copy shall
disclose the material terms, permitted uses, and the tenor and amortization schedule of such Working Capital Debt and the rate, or the rate basis and margin in the case of a floating rate, at which such Working Capital Debt shall bear interest, and
(if applicable) commitment fees or other premiums relating thereto; and (c) in the case of Working Capital Debt incurred pursuant to Section 4.08(d)(2) certify that the amount to be incurred is reasonably expected to be required to be
expended to purchase Gas to comply with the obligations of the Company under the Facility LNG Sale and Purchase Agreements 

  
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 Section 1.02    Other Definitions. 

 

			
	 Term
	  	Defined in
Section
	 “Accession Agreement”
	  	10.02
	 “Affiliate Transaction”
	  	4.30
	 “Applicable Expansion Debt Assets”
	  	4.08
	 “Asset Sale Offer”
	  	3.09
	 “Authentication Order”
	  	2.04
	 “Called Principal”
	  	3.07
	 “Change of Control Offer”
	  	4.13
	 “Change of Control Payment”
	  	4.13
	 “Change of Control Payment Date”
	  	4.13
	 “Covenant Change Date”
	  	4.30
	 “Covenant Defeasance”
	  	8.03
	 “Discounted Value”
	  	3.07
	 “DTC”
	  	2.03
	 “Event of Default”
	  	6.01
	 “Excess Loss Offer”
	  	3.09
	 “Excess Loss Proceeds”
	  	4.14
	 “Excess Proceeds”
	  	4.09
	 “IE Phase Report”
	  	4.08
	 “incur”
	  	4.08
	 “Legal Defeasance”
	  	8.02
	 “Optional Redemption Price”
	  	3.07
	 “Offer Amount”
	  	3.09
	 “Offer Period”
	  	3.09
	 “Paying Agent”
	  	2.03
	 “Project Document Termination Payment Offer”
	  	3.09
	 “Project Phase”
	  	4.08
	 “Purchase Date”
	  	3.09
	 “Registrar”
	  	2.03
	 “Reinvestment Yield”
	  	3.07
	 “Remaining Average Life”
	  	3.07
	 “Remaining Scheduled Payments”
	  	3.07
	 “Reported”
	  	3.07
	 “Rule 144A Information”
	  	4.03
	 “Settlement Date”
	  	3.07

 Section 1.03    [Reserved.] 

Section 1.04    Rules of Construction. 

(a) Unless the context otherwise requires: 

(1) a term has the meaning assigned to it; 

(2) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP; 

  
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 (3) “or” is not exclusive; 

(4) “including” means “including without limitation” whether or not stated; 

(5) words in the singular include the plural, and in the plural include the singular; 

(6) “will” shall be interpreted to express a command; 

(7) provisions apply to successive events and transactions; 

(8) references to sections of or rules under the Securities Act will be deemed to include substitute, replacement of successor
sections or rules adopted by the SEC from time to time; and 
 (9) references to any agreement or instrument means such
agreement or instrument as it may be amended, amended and restated or otherwise modified in accordance with the terms of this Indenture. 

(b) For purposes of the Common Terms Agreement and the Security Documents, the capitalized terms used therein shall have the respective
meanings set forth therein. 
 ARTICLE 2 

THE NOTES 

Section 2.01    Form and Dating. 

The Notes will be issued initially in Definitive Note form. Provisions relating to the Initial Notes and any Additional Notes issued under this
Indenture are set forth in Appendix A, which is hereby incorporated in and expressly made a part of this Indenture. The terms and provisions contained in the Notes will constitute, and are hereby expressly made, a part of this Indenture and the
Company, the Guarantors and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Note conflicts with the express provisions
of this Indenture, the provisions of this Indenture shall govern and be controlling. 
 Section 2.02    Interest and Principal
on the Notes 
 (a) Interest shall accrue on the outstanding principal balance of the Notes at a rate of 5.00% per annum and shall be
payable in arrears on each Payment Date in accordance with the Payment Schedule. 
 (b) Unless all of the Notes have been redeemed pursuant
to Section 3.07 and subject to proportional reduction in the event the Notes are redeemed in part, in each case as of a particular Payment Date, the principal amount specified as being payable on a Payment Date as set forth in the Payment
Schedule and accrued and unpaid interest shall be paid on each such Payment Date. Each Holder will receive its pro rata share of such payments. 

  
 56 

 Section 2.03    Adjustment to Payment Schedule 

The Payment Schedule shall be appropriately adjusted (whereby scheduled payments of principal and interest set out in the Payment Schedule are
increased or decreased, as applicable, in a pro rata manner) in any circumstance in which Additional Notes are issued in accordance with this Indenture, or in any circumstance in which Notes are redeemed, repaid or prepaid by the Company in
accordance with this Indenture, and a Supplemental Indenture shall be entered into in respect of such adjusted Payment Schedule, provided that the Trustee shall agree upon the adjusted Payment Schedule. For clarity, any amendments to the Payment
Schedule undertaken pursuant to and in accordance with this Section 2.03 do not require approval of the Holders. 

Section 2.04    Execution and Authentication. 

At least one Authorized Officer must sign the Notes for the Company by manual or facsimile signature. 

If an Authorized Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated, the Note will
nevertheless be valid. 
 A Note will not be valid until authenticated by the manual signature of the Trustee. The signature will be
conclusive evidence that the Note has been authenticated under this Indenture. 
 The Trustee will, upon receipt of a written order of the
Company signed by at least one Authorized Officer (an “Authentication Order”), authenticate Notes for original issue that may be validly issued under this Indenture, including any Additional Notes. The aggregate principal amount of
Notes outstanding at any time may not exceed the aggregate principal amount of Notes authorized for issuance by the Company pursuant to one or more Authentication Orders, except as provided in Section 2.08. 

The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with Holders or an Affiliate of the
Company. 
 The Initial Notes and the Additional Notes shall be treated as a single class for all purposes under this Indenture, and unless
the context otherwise requires, all references to the Notes shall include the Initial Notes and any Additional Notes. Nothing in this paragraph shall be deemed to modify, replace or otherwise affect the restrictions on transfer applicable to
Restricted Notes set forth in Section 2.3 of Appendix A. 

  
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 Section 2.05    Registrar and Paying Agent; Depositary. 

The Company will maintain an office or agency where Notes may be presented for registration of transfer or for exchange
(“Registrar”) and an office or agency where Notes may be presented for payment (“Paying Agent”). The Registrar will keep a register of the Notes and of their transfer and exchange. The Company may appoint one or
more co-registrars and one or more additional paying agents. The term “Registrar” includes any co-registrar and the term “Paying Agent”
includes any additional paying agent. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company will notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. If the
Company fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Paying Agent or Registrar. 

The Company initially appoints The Depository Trust Company (“DTC”) to act as Depositary with respect to the Global Notes.

 The Company initially appoints the Trustee to act as the Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes. 
 Section 2.06    Paying Agent to Hold Money in Trust. 

The Company will require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust for the benefit
of Holders or the Trustee all money held by the Paying Agent for the payment of principal, premium or interest on the Notes, and will notify the Trustee of any default by the Company in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the
Company or a Subsidiary) will have no further liability for the money. If the Company or a Subsidiary acts as Paying Agent, it will segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the Trustee will serve as Paying Agent for the Notes. 

Section 2.07    Holder Lists. 

The Trustee will preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of
all Holders. If the Trustee is not the Registrar, the Company will furnish to the Trustee at least seven Business Days before each Interest Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of
such date as the Trustee may reasonably require of the names and addresses of the Holders of Notes. 

  
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 Section 2.08    Replacement Notes. 

If any mutilated Note is surrendered to the Trustee or the Company and the Trustee receives evidence to its satisfaction of the destruction,
loss or theft of any Note, the Company will issue and the Trustee, upon receipt of an Authentication Order, will authenticate a replacement Note if the Trustee’s requirements are met. If required by the Trustee or the Company, an indemnity bond
must be supplied by the Holder that is sufficient in the judgment of the Trustee and the Company to protect the Company, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer if a Note is replaced. The Company
may charge for its expenses in replacing a Note. 
 Every replacement Note is an additional obligation of the Company and will be entitled
to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder. 

Section 2.09    Outstanding Notes. 

The Notes outstanding at any time are all the Notes authenticated by the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section 2.09 as not outstanding. Except as set forth in
Section 2.10, a Note does not cease to be outstanding because the Company or an Affiliate of the Company holds the Note; however, Notes held by the Company or an Affiliate of the Company shall not be deemed to be
outstanding for purposes of Section 3.07. 
 If a Note is replaced pursuant to
Section 2.08, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replacement Note is held by a “protected purchaser” under the Uniform Commercial Code. 

If the principal amount of any Note is considered paid under Section 4.01, it ceases to be outstanding and interest on it ceases
to accrue. 
 If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds, on a redemption date or
maturity date, money sufficient to pay Notes payable on that date, then on and after that date such Notes will be deemed to be no longer outstanding and will cease to accrue interest. 

Section 2.10    Treasury Notes. 

In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by
the Company or any Guarantor, or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any Guarantor, will be considered as though not outstanding, except that for the
purposes of determining whether the Trustee will be protected in relying on any such direction, waiver or consent, only Notes that the Trustee knows are so owned will be so disregarded. 

  
 59 

 Section 2.11    Temporary Notes. 

Until certificates representing Notes are ready for delivery, the Company may prepare and the Trustee, upon receipt of an Authentication Order,
will authenticate temporary Notes. Temporary Notes will be substantially in the form of certificated Notes but may have variations that the Company considers appropriate for temporary Notes and as may be reasonably acceptable to the Trustee. Without
unreasonable delay, the Company will prepare and the Trustee will authenticate definitive Notes in exchange for temporary Notes. 
 Holders
of temporary Notes will be entitled to all of the benefits of this Indenture. 
 Section 2.12    Cancellation. 

The Company at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent will forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else will cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and will destroy canceled Notes
(subject to the record retention requirement of the Exchange Act). Certification of the destruction of all canceled Notes will be delivered to the Company. The Company will promptly cancel all Notes acquired by it or any Affiliate pursuant to any
payment or prepayment of Notes pursuant to this Indenture and no Notes may be issued in substitution or exchange for any such Notes. 

Section 2.13    Defaulted Interest. 

If the Company defaults in a payment of interest on the Notes, it will pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Notes and in Section 4.01. The Company will notify the Trustee
in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Company will fix or cause to be fixed each such special record date and payment date; provided that no such special
record date may be less than 10 days prior to the related payment date for such defaulted interest. At least 15 days before the special record date, the Company (or, upon the written request of the Company, the Trustee in the name and at the expense
of the Company) will mail or cause to be mailed to Holders a notice that states the special record date, the related payment date and the amount of such interest to be paid. 

  
 60 

 ARTICLE 3 

REDEMPTION AND OFFERS TO PURCHASE NOTES 

Section 3.01    Notices to Trustee. 

If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07, it must furnish
to the Trustee, at least 30 days but not more than 60 days before a redemption date, an Officer’s Certificate setting forth: 

(1) the Section of this Indenture pursuant to which the redemption shall occur; 

(2) the redemption date; 

(3) the series, or more than one series, if applicable, of Notes to be redeemed; 

(4) the principal amount of Notes to be redeemed; 

(5) the redemption price; and 

(6) the CUSIP number of the Notes to be redeemed. 

Section 3.02    Selection of Notes to Be Redeemed. 

If less than all of the Notes are to be redeemed at any time, or less than all of the Notes of a particular series are to be redeemed, the
Trustee will select Notes for redemption pro rata, by lot or by such other method as the Trustee shall deem fair and appropriate (provided that, in the case of Global Notes, the Depositary may select Global Notes for redemption
pursuant to its Applicable Procedures) and, if applicable, with such adjustments that may be deemed appropriate by the Trustee so that only Notes in denominations of $100,000 or whole multiples of $1,000 in excess thereof will be purchased unless
otherwise required by law, Depositary requirements, or applicable stock exchange requirements; provided that if only Notes of a particular series are to be redeemed, such selection by the Trustee shall be limited to Notes of such series. 

No Notes of $100,000 or less can be redeemed in part. In the event of partial redemption, the particular Notes to be redeemed will be
selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption or purchase date by the Trustee from the outstanding Notes not previously called for redemption. 

The Trustee will promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of Notes selected will be in amounts of $100,000 or whole multiples of $1,000 in excess thereof; except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not in the amount of $100,000 or a whole multiple of $1,000 thereof, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called
for redemption also apply to portions of Notes called for redemption. 

  
 61 

 Section 3.03    Notice of Redemption. 

At least 30 days but not more than 60 days before a redemption date, the Company will mail or cause to be mailed, by first class mail, a notice
of redemption to each Holder whose Notes are to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or
a satisfaction and discharge of this Indenture pursuant to Article 8 or 12. 
 The notice will identify the Notes to be
redeemed and will state: 
 (1) the redemption date; 

(2) the redemption price; 

(3) if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion will be issued in the name of the Holder upon cancellation of the original Note; 

(4) the name and address of the Paying Agent; 

(5) that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price; 

(6) that, unless the Company defaults in making such redemption payment, interest on Notes called for redemption ceases to
accrue on and after the redemption date; 
 (7) the paragraph of the Notes and/or Section of this Indenture pursuant to which
the Notes called for redemption are being redeemed; and 
 (8) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the Notes. 
 At the Company’s request, the Trustee will give
the notice of redemption in the Company’s name and at its expense; provided, however, that the Company has delivered to the Trustee, at least 45 days prior to the redemption date (unless a shorter period is acceptable to the Trustee), an
Officer’s Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the preceding paragraph. 

  
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 Section 3.04    Effect of Notice of Redemption. 

Once notice of redemption is mailed in accordance with Section 3.03, Notes called for redemption become irrevocably
due and payable on the redemption date at the redemption price. A notice of redemption may not be conditional. 

Section 3.05    Deposit of Redemption or Purchase Price. 

At least one Business Day prior to the redemption date, the Company will deposit or will cause to be deposited with the Trustee or with the
Paying Agent money sufficient to pay the redemption price of and accrued interest on all Notes to be redeemed on that date. The Trustee or the Paying Agent will promptly return to the Company any money deposited with the Trustee or the Paying Agent
by the Company in excess of the amounts necessary to pay the redemption price of and accrued interest on all Notes to be redeemed. 
 If the
Company complies with the provisions of the preceding paragraph, on and after the redemption date, interest will cease to accrue on the Notes or the portions of Notes called for redemption. If a Note is redeemed on or after an interest record date
but on or prior to the related Payment Date, then any accrued and unpaid interest shall be paid to the Person in whose name such Note was registered at the close of business on such record date. If any Note called for redemption is not so paid upon
surrender for redemption because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal, from the redemption or purchase date until such principal is paid, and to the extent lawful on any
interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01. 

Section 3.06    Notes Redeemed in Part. 

Upon surrender of a Note that is redeemed in part, the Company will issue and, upon receipt of an Authentication Order, the Trustee will
authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the Note surrendered. 

Section 3.07    Optional Redemption. 

At any time or from time to time prior to March 15, 2037, the Company may, at its option, redeem all or a part of the Initial Notes at a
redemption price equal to the Optional Redemption Price (subject to the right of Holders of record on the relevant record date to receive interest due on a payment date that is on or prior to the redemption date, without duplication). 

“Optional Redemption Price” with respect to any Notes to be redeemed, means an amount equal to the greater of: 

 

	 	(1)	100% of the principal amount of such Notes; and 

  

	 	(2)	the Discounted Value of such Notes; 

  
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 plus, in the case of both (1) and (2), accrued and unpaid interest on such Notes, if any, to the redemption
date. 
 “Called Principal” means, with respect to any Note, the principal of such Note that is to be prepaid or has become
or is declared to be immediately due and payable, 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. 

“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. 

“Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum of (x) 0.50% and (y) the yield to
maturity implied by the yield(s) reported as of 10:00 a.m. (New York City time) on the second (2nd) 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 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, the sum of (x) 0.50% and (y) 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 (2nd) Business Day preceding the Settlement Date with respect 

  
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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” shall mean, with respect to any Called Principal, the number of years obtained by dividing
(a) such Called Principal into (b) the sum of the products obtained by multiplying (1) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (2) the number of years, computed on the
basis of a 360-day year composed of twelve 30-day months 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. 

“Settlement Date” means, with respect to the Called Principal of a Note, the date on which such Called Principal is to be
redeemed or has become or is declared to be immediately due and payable. 
 The notice of redemption with respect to the foregoing
redemption need not set forth the Optional Redemption Price but only the manner of calculation thereof. The Company will notify the Trustee of the Optional Redemption Price with respect to any redemption promptly after the calculation, and the
Trustee shall not be responsible for such calculation. 
 At any time on or after March 15, 2037, the Company may, at its option,
redeem all or a part of the Initial Notes at a redemption price equal to 100% of the principal amount of the Initial Notes to be redeemed, plus accrued and unpaid interest to the redemption date (subject to the right of holders of record on the
relevant record date to receive interest due on an interest payment date that is on or prior to the redemption date, without duplication). 

Section 3.08    Open Market Purchases; No Mandatory Redemption or Sinking Fund. 

The Company may at any time and from time to time purchase Notes in the open market or otherwise. The Company is not required to make mandatory
redemption or sinking fund payments with respect to the Notes. 
 Section 3.09    Offer to Purchase by Application of Excess
Proceeds or Excess Loss Proceeds. 
 In the event that, pursuant to Sections 4.09, 4.14 or 4.19, the Company is
required to commence an offer to all Holders to purchase Notes (an “Asset Sale Offer”, an “Excess Loss Offer” or a “Project Document Termination Payment Offer,” respectively), it will follow the
procedures specified below. 

  
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 The Asset Sale Offer, the Excess Loss Offer or the Project Document Termination Payment Offer, as
applicable, shall be made to all Holders and all holders of other Indebtedness that is pari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds
of sales of assets, loss proceeds or project document termination payments. The Asset Sale Offer, the Excess Loss Offer or the Project Document Termination Payment Offer, as applicable, with respect to all Holders will remain open for a period of at
least 20 Business Days following its commencement and not more than 30 Business Days, except to the extent that a longer period is required by Applicable Law (the “Offer Period”). No later than three Business Days after the
termination of the Offer Period (the “Purchase Date”), the Company will apply all Excess Proceeds, Excess Loss Proceeds or Project Document Termination Payments, as applicable (the “Offer Amount”), to the purchase
of Notes and such other pari passu Indebtedness (on a pro rata basis, if applicable) or, if less than the Offer Amount has been tendered, all Notes and other Indebtedness tendered in response to the Asset Sale Offer, the Excess Loss
Offer or the Project Document Termination Payment Offer, as applicable. Payment for any Notes so purchased will be made in the same manner as interest payments are made hereunder. 

If the Purchase Date is on or after an interest record date and on or before the related Payment Date, any accrued and unpaid interest will be
paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Sale Offer, the Excess Loss Offer or the Project
Document Termination Payment Offer, as applicable. 
 Upon the commencement of an Asset Sale Offer, Excess Loss Offer or Project Document
Termination Payment Offer, as applicable, the Company will send, by first class mail, a notice to each of the Holders, with a copy to the Trustee. The notice will contain all instructions and materials necessary to enable such Holders to tender
Notes pursuant to the Asset Sale Offer, the Excess Loss Offer or the Project Document Termination Payment Offer, as applicable. The notice, which will govern the terms of the Asset Sale Offer, the Excess Loss Offer or the Project Document
Termination Payment Offer, as applicable, will state: 
 (1) that the Asset Sale Offer, the Excess Loss Offer or the Project
Document Termination Payment Offer, as applicable, is being made pursuant to this Section 3.09 and Section 4.09, 4.14 or 4.19, as applicable, and the length of time the Asset Sale
Offer, the Excess Loss Offer or the Project Document Termination Payment Offer, as applicable, will remain open; 
 (2) the
Offer Amount, the purchase price and the Purchase Date; 

  
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 (3) that any Note not tendered or accepted for payment will continue to accrete
or accrue interest; 
 (4) that, unless the Company defaults in making such payment, any Note accepted for payment pursuant
to the Asset Sale Offer, the Excess Loss Offer or the Project Document Termination Payment Offer, as applicable, will cease to accrete or accrue interest after the Purchase Date; 

(5) that Holders electing to have a Note purchased pursuant to an Asset Sale Offer, Excess Loss Offer or Project Document
Termination Payment Offer, as applicable, may elect to have Notes purchased in integral multiples of $100,000 and integral multiples of $1,000 in excess thereof only; 

(6) that Holders electing to have Notes purchased pursuant to an Asset Sale Offer, Excess Loss Offer or Project Document
Termination Payment Offer, as applicable, will be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” attached to the Notes completed, or transfer by book-entry transfer, to the Company, a
Depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice at least three days before the Purchase Date; 

(7) that Holders will be entitled to withdraw their election if the Company, the Depositary or the Paying Agent, as the case
may be, receives, not later than the expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Note purchased; 
 (8) that, if the aggregate principal amount of Notes
and other pari passu Indebtedness surrendered by Holders thereof, if applicable, exceeds the Offer Amount, the Notes, and such other pari passu Indebtedness, shall be purchased on a pro rata basis and the Trustee will select the
Notes or portions thereof to be purchased by lot, on a pro rata basis or by any other method as the Trustee shall deem fair and appropriate; provided that, in the case of Global Notes, the Depositary may select Global Notes for redemption
pursuant to its Applicable Procedures (and, if applicable, with respect to the Notes, with such adjustments as may be deemed appropriate by the Trustee so that only Notes in denominations of $100,000 and integral multiples of $1,000 in excess
thereof, will be purchased); and 
 (9) that Holders whose Notes were purchased only in part will be issued new Notes equal
in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer). 

  
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 On or before the Purchase Date, the Company will, to the extent lawful, accept for payment, on a
pro rata basis to the extent necessary, the Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer, the Excess Loss Offer or the Project Document Termination Payment Offer, as applicable, or if less than the Offer
Amount has been tendered, all Notes tendered, and will deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officer’s Certificate stating that such Notes or portions thereof were accepted for payment by
the Company in accordance with the terms of this Section 3.09. The Company, the Depositary or the Paying Agent, as the case may be, will promptly (but in any case not later than five days after the Purchase Date) mail or
deliver to each tendering Holder an amount equal to the purchase price of the Notes tendered by such Holder and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon written request from the
Company, will authenticate and mail or deliver (or cause to be transferred by book entry) such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered. Any Note not so accepted shall be promptly mailed
or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Sale Offer, the Excess Loss Offer or the Project Document Termination Payment Offer, as applicable, on the Purchase Date. 

Section 3.10    Allocation of Partial Prepayments. 

In the case of each partial prepayment of the Notes pursuant to Section 3.09, the principal amount of the Notes to be prepaid shall
be allocated among all of the Notes at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment. 

ARTICLE 4 
 COVENANTS 

Section 4.01    Payment of Notes. 

The Company will pay or cause to be paid the principal of, and interest on, the Notes on the dates and in the manner provided in the Payment
Schedule. Each Holder will receive its pro rata share of such payments. Principal, premium, if any, and interest will be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 12:00
p.m. Eastern Time on the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due. 

The Company will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on any overdue principal balance
of the Notes and any overdue interest thereon at the rate equal to 0.5% per annum in excess of the then applicable interest rate on the Notes to the extent lawful (without regard to any applicable grace period). 

  
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 Section 4.02    Maintenance of Office or Agency. 

The Company will maintain in the Borough of Manhattan, the City of New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Notes and
this Indenture may be served. The Company will give written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company fails to maintain any such required office or agency or fails to
furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee. 

The Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission will in any manner relieve the Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company will give written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency. 

The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with
Section 2.05. 
 Section 4.03    Information About the Company. 

(a) The Company shall file with the Trustee (i) within 15 days after the Company files them with the SEC, copies of its annual
reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) that the Company is required to file with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act; and (ii) within 15 days after such documents become available, copies of each financial statement, report, notice of default, proxy statement or similar document sent by the Company or any Subsidiary to its creditors under
any Senior Debt (excluding information sent to such creditors in the ordinary course of administration of such Senior Debt). 
 (b) So long
as any Notes are outstanding, the Company will furnish to the Trustee and also to the Holders and Beneficial Owners of the Notes and to securities analysts and prospective investors in the Notes, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act (or any successor provision thereto) (“Rule 144A Information”). 

  
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 (c) So long as any of the Notes are outstanding, in addition to the requirement to furnish
Rule 144A Information as provided in the preceding clause (b), the Company shall furnish or cause to be furnished to Holders and (upon the request thereof delivered to the Company) to Holders of an interest in any Global Note: 

(1) annual audited consolidated financial statements of the Company prepared in accordance with GAAP (together with notes
thereto and a report thereon by an independent accountant of established national reputation), such statements to be so furnished on the date that is the later of (i) 105 days after the end of the Fiscal Year covered thereby and (ii) the date
on such financial statements are required to be delivered under any Senior Debt (or the date on which such financial statements are delivered under any Senior Debt, if such delivery occurs earlier than such required delivery date); 

(2) unaudited consolidated financial statements of the Company for each of the first three Fiscal Quarters of each Fiscal Year
of the Company and the corresponding quarter and year-to-year period of the prior year prepared in all material respects on a basis consistent with the annual financial
statements furnished pursuant to clause (1) of this clause (c), such statements to be so furnished on the date that is the earlier of (i) 60 days after the end of each such quarter and (ii) the date on such financial statements
are required to be delivered under any Senior Debt (or the date on which such financial statements are delivered under any Senior Debt, if such delivery occurs earlier than such required delivery date); 

(3) copies of any notice to the Company or any Subsidiary from any Government Authority relating to any order, ruling, statute
or other law or regulation that could reasonably be expected to have a Material Adverse Effect, such copies to be furnished promptly, and in any event within 30 days of receipt thereof; 

(4) notification of resignation or replacement of the Company’s auditors and any further information as the Holders may
request, such notification to be furnished within 10 days following such resignation or replacement; 
 (5) such other data
and information relating to the business, operations, affairs, financial condition, assets or properties of the Company or any of its Subsidiaries (including actual copies of the Company’s Form 10-Q and
Form 10-K) or relating to the ability of the Company to perform its obligations hereunder and under the Notes as from time to time may be reasonably requested by any such Holder, such other data or information
to be furnished with reasonable promptness; and 
 (d) Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee’s receipt of such shall not constitute actual or constructive knowledge or notice of any information contained therein or determinable from information contained therein, including the Company’s
compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates). 

  
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 (e) Notwithstanding the foregoing, any reports, Officer’s Certificates or other information
required to be filed, delivered or furnished pursuant to this Section 4.03 shall be deemed to be so filed, delivered or furnished: 

(1) with respect to the financial statements furnished pursuant to clauses (1) and (2) of Section
4.03(c), if such financial statements are (i) delivered to each Holder by e-mail at the e-mail address of the Holder set forth in the Initial Notes Purchase
Agreement or as communicated from time to time in a separate writing delivered to the Company, (ii) filed electronically with the SEC through the SEC’s Electronic Data Gathering, Analysis and Retrieval System (or any successor system), or
(iii) are timely posted by or on behalf of the Company on IntraLinks or on any other similar website to which each Holder has free access; 

(2) with respect to the Officer’s Certificate delivered pursuant to Sections 4.03(f) and 4.04, if such
Officer’s Certificate is (i) delivered to each Holder by e-mail at the e-mail address of the Holder set forth in the Initial Notes Purchase Agreement or as
communicated from time to time in a separate writing delivered to the Company, (ii) made available on the Company’s home page on the internet at such internet address as will be provided to Holders, or (iii) posted by or on behalf of
the Company on IntraLinks or on any other similar website to which each Holder has free access; and 
 (3) with respect to
the reports and documents filed pursuant to Section 4.03(a), if such reports or documents are (i) delivered to each Holder by e-mail at the e-mail address of
the Holder set forth in the Initial Notes Purchase Agreement or the purchase agreement for any Additional Note or as communicated from time to time in a separate writing delivered to the Company, or (ii) timely filed electronically with the SEC
through the SEC’s Electronic Data Gathering, Analysis and Retrieval System (or any successor system) and made available on the Company’s home page on the internet at such internet address as will be provided to Holders, or on IntraLinks or
any other similar website to which each Holder has free access. 
 (f) Each set of financial statements delivered to a Holder of a Note
pursuant to clauses (c)(1) and (c)(2) of this Section 4.03 shall be accompanied by an Officer’s Certificate setting forth a list of all Subsidiaries that are Guarantors and certifying that each Subsidiary
that is required to be a Guarantor pursuant to Section 11.01 is a Guarantor, in each case, as of the date of such Officer’s Certificate. 

(g) The Company shall permit each Holder: 

(1) No Default – if no Default or Event of Default then exists, at the expense of such Holder and upon reasonable
prior notice to the Company, to visit the principal executive office of the Company, to discuss the affairs, finances and accounts of the Company and its Subsidiaries with the Company’s officers, and (with the consent of the

  
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Company, which consent will not be unreasonably withheld) its independent public accountants, and (with the consent of the Company, which consent will not be unreasonably withheld) to visit the
other offices and properties of the Company and each Subsidiary, all at such reasonable times and as requested in writing; provided, that under no circumstances shall such visit occur more than twice a year, and any such visit shall be subject to
such Holder entering into a confidentiality agreement with the Company prior to any such visit; and 
 (2) Default
— if a Default or Event of Default then exists, at the expense of the Company to visit and inspect any of the offices or properties of the Company or any Subsidiary, to examine all their respective books of account, records, reports and
other papers, to make copies and extracts therefrom, and to discuss their respective affairs, finances and accounts with their respective officers and independent public accountants (and by this provision the Company authorizes said accountants to
discuss the affairs, finances and accounts of the Company and its Subsidiaries), all at such times and as often as may be requested; provided, that any such visit shall be subject to such Holder entering into a confidentiality agreement with the
Company prior to any such visit. 
 Section 4.04    Compliance Certificates 

(a) The Company shall deliver to the Trustee, within 90 days after the end of each Fiscal Year, an Officer’s Certificate stating that to
the signing Officer’s knowledge no Default or Event of Default has occurred and is continuing (or, if a Default or Event of Default has occurred and is continuing, describing all such Defaults or Events of Default of which he or she has
knowledge and what action the Company is taking or proposes to take with respect thereto). 
 (b) So long as any of the Notes are
outstanding, the Company will deliver to the Trustee, forthwith upon any Officer becoming aware of any Default or Event of Default, an Officer’s Certificate specifying such Default or Event of Default and what action the Company is taking or
proposes to take with respect thereto. 
 Section 4.05    Taxes. 

Each of the Company and its Restricted Subsidiaries (or, for the purposes of this Section 4.05, if such entity is a disregarded entity for
U.S. income tax purposes, its direct owner) shall (a) file or cause to be filed all tax returns required to be filed by it, and (b) pay and discharge, before the same shall become delinquent, after giving effect to any applicable
extensions, all taxes imposed on it or its property (including interest and penalties) unless such taxes are being contested in good faith and by appropriate proceedings, appropriate reserves are maintained with respect thereto and such proceedings,
if adversely determined, could not reasonably be expected to have a Material Adverse Effect. 

  
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 Section 4.06    Restricted Payments. 

The Company will not, and will not permit any of its Restricted Subsidiaries to, make or agree to make, directly or indirectly, any Restricted
Payments unless on the Restricted Payment Date each of the following conditions has been satisfied: 
 (a) no Default or Event of Default
has occurred and is continuing as of the Restricted Payment Date or would occur as a result of the Restricted Payment; 
 (b) on and as of
the applicable Calculation Date with respect to such Restricted Payment Date, (i) the Debt Service Coverage Ratio for the Calculation Period ended on the applicable Calculation Date is at least 1.25 to 1.0, and (ii) the Projected Debt
Service Coverage Ratio commencing on the first day after such Calculation Date is at least 1.25 to 1.0 for the upcoming twelve month period, provided that the Company may, at its option, exclude any Debt Service that (x) was pre-funded by the incurrence of Indebtedness, one of the use of proceeds of which was expressly for this purpose or (y) will be funded as part of scheduled draws pursuant to the express terms of Indebtedness to
be incurred during such upcoming twelve month period; and provided, further that, (A) such Projected Debt Service Coverage Ratio shall not be required during the final three quarters prior to the last scheduled maturity of the
final principal amount of the Notes and (B) if the Company shall have excluded each month in the relevant Calculation Period from the calculation of the Debt Service Coverage Ratio pursuant to the definition of Debt Service Coverage Ratio due
to a Force Majeure Event, only subclause (ii) of this clause (c) shall apply; 
 (c) each Debt Service Reserve Account and
Additional Debt Service Reserve Account is funded to its then required funding level; 
 (d) the Company shall have delivered to the Trustee
a certificate of an Authorized Officer of the Company (i) to the effect that all conditions for a Restricted Payment on the Restricted Payment Date have been satisfied, and (ii) setting forth in reasonable detail the calculations for
computing each of the Debt Service Coverage Ratio (including, if applicable, identifying any months in which the Cash Flow Available for Debt Service and the aggregate amount required to service the Company’s Debt Service has been excluded in
respect of a Force Majeure Event) and the Projected Debt Service Coverage Ratio for the relevant periods and stating that such calculations were prepared in good faith and were based on reasonable assumptions; and 

(e) if the Company has been subject to a Force Majeure Event for greater than twelve consecutive months and has relied on the second proviso
in the definition of Debt Service Coverage Ratio to make Restricted Payments during such twelve-month period, at least three consecutive months shall have elapsed without any Force Majeure Event before the Company may make Restricted Payments. 

  
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 Subject to the Accounts Agreement, the Company may make Restricted Payments not more frequently
than once per calendar month. 
 Section 4.07    Dividend and Other Payment Restrictions Affecting Subsidiaries. 

(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or
become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to: 
 (1)
(A) pay dividends or make any other distributions on its Capital Stock to the Company or any of its Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by, its profits, or (B) pay any
indebtedness owed to the Company or any of its Restricted Subsidiaries; 
 (2) make loans or advances to the Company or any
of its Restricted Subsidiaries; or 
 (3) sell, lease or transfer any of its properties or assets to the Company or any of
its Restricted Subsidiaries. 
 (b) The restrictions in Section 4.07(a) will not apply to encumbrances or restrictions existing under
or by reason of: 
 (1) agreements or instruments governing existing indebtedness as in effect on the Notes Issue Date and
any amendments, restatements, modifications, increases, renewals, supplements, refundings, replacements or refinancings of those agreements or instruments; provided that the amendments, restatements, modifications, increases, renewals,
supplements, refundings, replacements or refinancings are no more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in those agreements or instruments on the Notes Issue Date; 

(2) the Common Terms Agreement, this Indenture, the Notes, the Note Guarantees and the Security Documents; 

(3) Applicable Law; 

(4) customary non-assignment provisions in contracts and licenses entered into in the
ordinary course of business; 
 (5) purchase money obligations for property acquired in the ordinary course of business and
Capital Lease Obligations that impose restrictions on the property purchased or leased of the nature described in clause (3) of Section 4.07(a); 

  
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 (6) any agreement for the sale or other disposition of a Restricted Subsidiary
that restricts distributions by that Restricted Subsidiary pending the sale or other disposition; 
 (7) Permitted
Indebtedness, including Permitted Refinancing Indebtedness; provided that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those
contained in the agreements governing the Indebtedness being refinanced; 
 (8) Liens permitted to be incurred under the
provisions of Section 4.10 that limit the right of the debtor to dispose of the assets subject to such Liens; 

(9) provisions limiting the disposition or distribution of assets or property in joint venture agreements, asset sale
agreements, sale-leaseback agreements, stock sale agreements, security agreements, mortgages, purchase money agreements and other similar agreements or instruments entered into with the approval of the Board of Directors of the Company, which
limitation is applicable only to the assets that are the subject of such agreements; 
 (10) Permitted Hedging Agreements;
and 
 (11) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the
ordinary course of business. 
 Section 4.08    Incurrence of Indebtedness and Issuance of Preferred Stock. 

The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, permit,
suffer to exist or otherwise be or become liable with respect to, contingently or otherwise (collectively, “incur”), any Indebtedness and the Company will not permit any of its Restricted Subsidiaries to issue preferred stock;
provided, however, that the Company and any Guarantor may incur Indebtedness or directly or indirectly create or incur or otherwise be or become liable with respect to any Guarantee if any of the following conditions are satisfied:

 (a) with respect to an incurrence of Indebtedness that is (1) Expansion Debt or (2) Permitted Refinancing
Indebtedness of the Company or any of its Restricted Subsidiaries in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge any Indebtedness (other than intercompany Indebtedness) that would
have been permitted to be incurred pursuant to clauses (a), (b) or (c) of Section 4.08 of the 2013 Indenture prior to the Investment Grade Date, the Company shall have delivered to the Trustee a certificate of an Authorized Officer of the
Company certifying that the amount of all Senior Debt (excluding Working Capital Debt, all Indebtedness or Guarantees incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of this
Section 4.08, and all Indebtedness or Guarantees that would have 

  
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been permitted to be incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08 of the 2013 Indenture prior to the Investment Grade Date)
outstanding after giving effect to the incurrence of such Indebtedness and the application of the proceeds therefrom, is capable of being amortized to a zero balance by the termination date of the last to terminate of the Applicable Facility LNG
Sale and Purchase Agreements such that the Projected Debt Service Coverage Ratio after the last Guaranteed Substantial Completion Date with respect to any Trains then in construction (or if the In-Service Date
has occurred with respect to all Trains, the date of incurrence of the Indebtedness) through the terms of such Applicable Facility LNG Sale and Purchase Agreements, would be at least 1.5 to 1.0; provided that (i) the Projected Debt Service
Coverage Ratio shall be calculated (x) solely with respect to Contracted Cash Flow; and (y) using an interest rate equal to the weighted average interest rate of all such Senior Debt outstanding after giving effect to the incurrence of the
Indebtedness and the application of the proceeds therefrom and (ii) all of the Indebtedness required or anticipated to be incurred in connection with the construction of each of Train One and Train Two, Train Three and Train Four and Train Five
has either been (x) fully funded or (y) no longer has any conditions precedent to funding that have not been satisfied or waived; or 

(b) (1) the Indebtedness to be incurred has received at least two Investment Grade Ratings and (2) the Company shall
have received (A) letters from any two Acceptable Rating Agencies (or if only one Acceptable Rating Agency is then rating the Notes, the Company shall have received a letter from that Acceptable Rating Agency) to the effect that the Acceptable
Rating Agency has considered the contemplated incurrence, and that, if the contemplated incurrence is consummated, such Acceptable Rating Agency would reaffirm the Investment Grade Issue Rating of the Notes as of the date of such incurrence and
(B) letters from all other Acceptable Rating Agencies then rating the Notes, if any, to the effect that the Acceptable Rating Agency has considered the contemplated incurrence, and that, if the contemplated incurrence is consummated, such
Acceptable Rating Agency would reaffirm its then current rating of the Notes as of the date of such incurrence; or 
 (c) the
Company shall have delivered to the Trustee a certificate of an Authorized Officer of the Company certifying that the amount of all Senior Debt (excluding Working Capital Debt, all Indebtedness or Guarantees incurred pursuant to clauses (f), (g),
(h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08, and all Indebtedness or Guarantees that would have been permitted to be incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and
(q) of Section 4.08 of the 2013 Indenture prior to the Investment Grade Date) outstanding after giving effect to the incurrence of the Indebtedness and the application of the proceeds therefrom (A) would have resulted in a Debt
Service Coverage Ratio of at least 1.5 to 1.0 for the most recently ended four Fiscal Quarters and (B) is capable of being amortized to a zero balance by the termination date of the last to terminate of the Applicable Facility LNG Sale and
Purchase Agreements such that after the last Guaranteed Substantial Completion Date with respect to any Trains then in 

  
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construction (or if the In-Service Date has occurred with respect to all Trains, the date of incurrence of the Indebtedness) through the terms of such
Applicable Facility LNG Sale and Purchase Agreements, the Projected Debt Service Coverage Ratio would be at least 1.5 to 1.0 for each Fiscal Year during such period; provided that (i) each of the Debt Service Coverage Ratio and the Projected
Debt Service Coverage Ratio shall be calculated (x) solely with respect to Contracted Cash Flow; and (y) using an interest rate equal to the weighted average interest rate of all such Senior Debt outstanding after giving effect to the
incurrence of the Indebtedness and the application of the proceeds therefrom and (ii) all of the Indebtedness required or anticipated to be incurred in connection with the construction of each of Train One and Train Two, Train Three and Train
Four and Train Five has either been (x) fully funded or (y) no longer has any conditions precedent to funding that have not been satisfied or waived; 

and the Company and any Guarantor may incur any of the following items of Indebtedness: 

(d) Working Capital Debt of the Company or a Guarantor in an amount not to exceed the sum of (i) $200,000,000 and (ii) an
amount required to be expended to purchase Gas to comply with the obligations of the Company under the Facility LNG Sale and Purchase Agreements; 

(e) purchase money Indebtedness or Capital Lease Obligations of the Company or a Restricted Subsidiary of the Company to the
extent incurred in the ordinary course of business to finance the acquisition or licensing of intellectual property or items of equipment; provided, that (i) if such obligations are secured, they are secured only by Liens upon the equipment or
intellectual property being financed and (ii) the aggregate principal amount and the capitalized portion of such obligations do not at any time exceed $100,000,000 in the aggregate; 

(f) other unsecured Indebtedness for borrowed money subordinated to the Obligations pursuant to the form of subordination
agreement attached to this Indenture (or otherwise pursuant to an instrument in writing satisfactory in form and substance to the Required Secured Parties (other than the Holders)); provided, that such instrument shall include that: (i) the
maturity of such subordinated debt shall be no shorter than the maturity of the latest maturing tranche of Secured Debt; (ii) such subordinated debt shall not be amortized; (iii) no interest payments shall be made under such subordinated
debt except from monies held in the Distribution Account and that are permitted to be distributed pursuant to the Accounts Agreement; and (iv) such subordinated debt shall not impose covenants on the Company; 

(g) trade or other similar Indebtedness of the Company or a Restricted Subsidiary of the Company incurred in the ordinary
course of business, which is (i) not more than 90 days past due, or (ii) being contested in good faith and by appropriate proceedings; 

  
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 (h) contingent liabilities of the Company or a Restricted Subsidiary of the
Company incurred in the ordinary course of business, including the acquisition or sale of goods, services, supplies or merchandise in the normal course of business, the endorsement of negotiable instruments received in the normal course of business
and indemnities provided under any of the Transaction Documents; 
 (i) any obligations of the Company or a Restricted
Subsidiary of the Company under Permitted Hedging Agreements; 
 (j) to the extent constituting Indebtedness, indebtedness of
the Company or a Restricted Subsidiary of the Company arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course or other cash management
services in the ordinary course of business; 
 (k) to the extent constituting Indebtedness, obligations of the Company or a
Restricted Subsidiary of the Company in respect of performance bonds, bid bonds, appeal bonds, surety bonds, indemnification obligations, obligations to pay insurance premiums,
take-or-pay or take-or-deliver obligations contained in supply agreements, cash deposits
incurred in connection with natural gas purchases and similar obligations incurred in the ordinary course of business; 
 (l)
Indebtedness of the Company or a Restricted Subsidiary of the Company in respect of any bankers’ acceptance, letter of credit, warehouse receipt or similar facilities entered into in the ordinary course of business; 

(m) Indebtedness of the Company or a Restricted Subsidiary of the Company in respect of netting services, overdraft protections
and otherwise in connection with deposit accounts; 
 (n) Indebtedness of the Company or a Restricted Subsidiary of the
Company in an amount not to exceed $250,000,000 to finance the restoration of the Project following an Event of Loss; 
 (o)
Indebtedness of the Company or a Restricted Subsidiary of the Company consisting of the financing of insurance premiums in customary amounts consistent with the operations and business of the Company and its Restricted Subsidiaries in the ordinary
course of business; 
 (p) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a
Restricted Subsidiary of the Company to the extent that the guaranteed Indebtedness was permitted to be incurred by another clause of this Section 4.08; provided that if the Indebtedness being guaranteed is subordinated to
or pari passu with the Notes, then the Guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed; 

  
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 (q) the incurrence by the Company or any of its Restricted Subsidiaries of
intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that: 

(1) if the Company or any Guarantor is the obligor on such Indebtedness and the payee is not the Company or a Guarantor, such
Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or the Note Guarantee, in the case of a Guarantor; and 

(2) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person
other than the Company or a Restricted Subsidiary of the Company and (B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to
constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (q); and 

(r) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal
amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (r), not to
exceed $250,000,000. 
 For purposes of determining compliance with this Section 4.08, in the event that an item
of Indebtedness meets the criteria of more than one of the categories of Permitted Indebtedness pursuant to clauses (a) through (r) of this Section 4.08, the Company will be permitted to classify or divide such item of
Indebtedness on the date of its incurrence, or later reclassify or redivide all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.08. The accrual of interest, the accretion or
amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles will
not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.08; provided, in each such case, that the amount of any such accrual, accretion or payment is included in Debt Service of the Company
as accrued. Notwithstanding any other provision of this Section 4.08, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.08 shall
not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. 

  
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 The amount of any Indebtedness outstanding as of any date will be: 

(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount; 

(2) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the least of: 

(A) the Fair Market Value of such asset at the date of determination; 

(B) the amount of the Indebtedness of the other Person; and 

(C) the principal amount of the Indebtedness, in the case of any other Indebtedness. 

Section 4.09    Asset Sales. 

(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless: 

(1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale equal
to the greater of (A) the Fair Market Value of the assets or Equity Interests issued or sold or otherwise disposed of and (B) an amount equal to the invested cost of the assets sold or otherwise disposed of, less depreciation; and 

(2) at least 90% of the consideration therefor received by the Company or such Restricted Subsidiary is in the form of
cash, Cash Equivalents or Replacement Assets or a combination thereof. For purposes of this provision, each of the following will be deemed to be cash: 

(A) any liabilities, as shown on the Company’s or such Restricted Subsidiary’s most recent consolidated balance sheet
(or as would be shown on the Company’s consolidated balance sheet as of the date of such Asset Sale) of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the
Notes or any Note Guarantee) that are assumed by the transferee of any such assets pursuant to a written novation agreement that releases the Company or such Restricted Subsidiary from further liability therefor; and 

(B) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee
that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents within 90 days after such Asset Sale, to the extent of the cash or Cash Equivalents received in that conversion. 

  
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 (b) Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the
Company (or the applicable Restricted Subsidiary, as the case may be) may apply an amount equal to such Net Cash Proceeds: 

(1) to repay Senior Debt in accordance with the Common Terms Agreement and this Indenture; or 

(2) to make any capital expenditure or to purchase Replacement Assets (or enter into a binding agreement to make such capital
expenditure or to purchase such Replacement Assets; provided that (A) such capital expenditure or purchase is consummated within the later of (i) 360 days after the receipt of the Net Cash Proceeds from the related Asset Sale
and (ii) 180 days after the date of such binding agreement and (B) if such capital expenditure or purchase is not consummated within the period set forth in subclause (A), the amount not so applied will be deemed to be Excess
Proceeds. 
 (c) Pending the final application of any Net Cash Proceeds, the Company may reduce revolving credit borrowings or otherwise
invest the Net Cash Proceeds in any manner that is not prohibited by this Indenture. 
 (d) An amount equal to any Net Cash Proceeds from
Asset Sales that are not applied or invested as provided in the preceding clauses of this Section 4.09 will constitute “Excess Proceeds.” If on any date, the aggregate amount of Excess Proceeds exceeds
$100,000,000, then within ten Business Days after such date, the Company will make an Asset Sale Offer in accordance with Section 3.09. The offer price in any Asset Sale Offer will be equal to 100% of the principal amount
plus accrued and unpaid interest to, but excluding, the date of purchase and will be payable in cash. If any Excess Proceeds remain unapplied after consummation of an Asset Sale Offer, the Company and its Restricted Subsidiaries may use those Excess
Proceeds for any purpose not otherwise prohibited by this Indenture. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. 

(e) Notwithstanding the foregoing, the sale, conveyance or other disposition of all or substantially all of the assets of the Company and its
Restricted Subsidiaries, taken as a whole, will be governed by the provisions of Section 4.13 and/or the provisions of Section 5.01 and not by the provisions of this
Section 4.09. 
 (f) The Company will comply with the requirements of
Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with each repurchase of Notes pursuant to an
Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of Section 3.09 or this Section 4.09, or compliance with the provisions of
Section 3.09 or this Section 4.09 would constitute a violation of any such laws or regulations, the Company will comply with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under Section 3.09 or this Section 4.09 by virtue of such compliance. 

  
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 Section 4.10    Liens. 

The Company will not, and will not permit any Restricted Subsidiary to, create, assume, incur, permit or suffer to exist any Lien upon the
Collateral, whether now owned or hereafter acquired, except for the Permitted Liens. 
 Section 4.11    Business Activities.

 The Company will not, and will not permit any of its Restricted Subsidiaries to, engage in any business or activities other than the
Permitted Businesses, except to such extent as would not be material to the Company and its Restricted Subsidiaries, taken as a whole. 

Section 4.12    Maintenance of Existence. 

Subject to the rights of the Company under Section 5.01, the Company shall do all things necessary to maintain:
(a) its corporate, limited liability company or partnership, as applicable, existence in its jurisdiction of organization; provided, that the foregoing shall not prohibit conversion into another form of entity or continuation in another
jurisdiction and (b) the power and authority (corporate and otherwise) necessary under the Applicable Law to own its properties and to carry on the business of the Project. Each of the Company and the Guarantors shall not dissolve, liquidate,
and shall not take any action to amend or modify its corporate constituent or governing documents where such amendment would be adverse in any material respect to the Holders. 

Section 4.13    Offer to Repurchase Upon Change of Control. 

(a) Upon the occurrence of a Change of Control, the Company will make an offer (a “Change of Control Offer”) of payment (a
“Change of Control Payment”) to each Holder to repurchase all (equal to $100,000 and integral multiples of $1,000 in excess thereof) of that Holder’s Notes at a purchase price in cash equal to not less than 101% of the
aggregate principal amount of Notes repurchased plus accrued and unpaid interest to the date of repurchase (the “Change of Control Payment Date,” which date will be no earlier than the date of such Change of Control). No later than
30 days following any Change of Control, the Company will mail a notice to each Holder describing the transaction or transactions that constitute the Change of Control and stating: 

(1) that the Change of Control Offer is being made pursuant to this Section 4.13 and that all Notes
tendered will be accepted for payment; 
 (2) the purchase price and the purchase date, which shall be no earlier than 30
days and no later than 60 days from the date such notice is mailed; 
 (3) that any Note not tendered will continue to
accrete or accrue interest; 

  
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 (4) that, unless the Company defaults in the payment of the Change of Control
Payment, all Notes accepted for payment pursuant to the Change of Control Offer will cease to accrete or accrue interest after the Change of Control Payment Date; 

(5) that Holders electing to have any Notes purchased pursuant to a Change of Control Offer will be required to surrender the
Notes, with the form entitled “Option of Holder to Elect Purchase” attached to the Notes completed, or transfer by book-entry transfer, to the Paying Agent at the address specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date; 
 (6) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount
of Notes delivered for purchase, and a statement that such Holder is withdrawing his election to have the Notes purchased; and 

(7) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered, which unpurchased portion must be equal to $100,000 in principal amount or an integral multiple of $1,000 in excess thereof. 

The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other
securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control. To the extent that the provisions of any securities laws or
regulations conflict with this Section 4.13, or compliance with this Section 4.13 would constitute a violation of any such laws or regulations, the Company will comply with the applicable
securities laws and regulations and will not be deemed to have breached its obligations under this Section 4.13 by virtue of such compliance. 

(b) On the Change of Control Payment Date, the Company will, to the extent lawful: 

(1) accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Offer; 

(2) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes
properly tendered; and 
 (3) deliver or cause to be delivered to the Trustee the Notes properly accepted together with an
Officer’s Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company. 

  
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 The Paying Agent will promptly mail (but in any case not later than five days after the Change of
Control Payment Date) to each Holder of Notes properly tendered the Change of Control Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal
amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note will be in a principal amount of $100,000 or an integral multiple of $1,000 in excess thereof. 

(c) The Company will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control
Payment Date. 
 (d) If Holders of not less than 95% in aggregate principal amount of the outstanding Notes validly tender and do not
withdraw such Notes in a Change of Control Offer and the Company, or any third party making a Change of Control Offer in lieu of the Company as described below, purchases all of the Notes validly tendered and not withdrawn by such Holders, the
Company will have the right, upon not less than 30 nor more than 60 days’ prior notice, given not more than 30 days following such purchase pursuant to the Change of Control Offer described above, to redeem all Notes
that remain outstanding following such purchase at a redemption price in cash equal to the applicable Change of Control Payment plus, to the extent not included in the Change of Control Payment, accrued and unpaid interest thereon, to the date of
redemption. 
 (e) Notwithstanding anything to the contrary in this Section 4.13, the Company will not be required
to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this
Section 4.13 and purchases all Notes properly tendered and not withdrawn under the Change of Control Offer, or (2) notice of redemption has been given pursuant to Section 3.03 with respect to
a redemption of Notes pursuant to Section 3.07, unless and until there is a default in payment of the applicable redemption price. 

Section 4.14    Events of Loss 

(a) After any Event of Loss, the Company may apply the Net Loss Proceeds from the Event of Loss to the rebuilding, repair, replacement or
construction of improvements to the Project, with no obligation to make any purchase of any Notes, provided, that with respect to any Event of Loss that results in Net Loss Proceeds equal to or greater than $100,000,000: 

(1) the Company delivers to the Trustee within 120 days of such Event of Loss a written opinion from a reputable
contractor that the Project can be rebuilt, repaired, replaced or constructed and operating within 540 days following such Event of Loss; and 

(2) the Company delivers to the Trustee within 120 days of such Event of Loss a certificate from an Authorized
Officer of the Company certifying that the applicable entity has available from Net Loss Proceeds, cash on hand, binding equity commitments 

  
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with respect to funds, anticipated insurance proceeds and/or available borrowings under Indebtedness permitted under Section 4.08 to complete the rebuilding, repair,
replacement or construction described in clause (1) above and to pay debt service on its Indebtedness during the repair or restoration period. 

(b) Any Net Loss Proceeds that are not reinvested (or committed for reinvestment by the Company) within 540 days following an Event
of Loss will be deemed “Excess Loss Proceeds.” Within 15 days following the date on which the aggregate amount of Excess Loss Proceeds exceeds $100,000,000, the Company will make an Excess Loss Offer in accordance with
Section 3.09. The offer price in any Excess Loss Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to, but excluding, the date of purchase and will be payable in cash. If any Excess Loss
Proceeds remain after consummation of an Excess Loss Offer, the Company may use those Excess Proceeds for any purpose not otherwise prohibited by this Indenture. Upon completion of each Excess Loss Offer, the amount of Excess Loss Proceeds will be
reset at zero. 
 (c) The Company will comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Excess Loss Offer. To the extent that the provisions of any securities
laws or regulations conflict with the provisions of Section 3.09 or this Section 4.14, the Company will comply with the applicable securities laws and regulations and will not be deemed to have
breached its obligations under Section 3.09 or this Section 4.14 by virtue of such conflict. 

(d) If the Trustee, on behalf of the Holders, receives any excess Insurance Proceeds, Condemnation Proceeds or Performance Liquidated Damages
applied to the prepayment of Secured Debt and other Obligations as provided in the Common Terms Agreement and this Indenture does not require the Company to make an Excess Loss Offer pursuant to Section 3.09 and this
Section 4.14, the Company shall instruct the Trustee to deposit such proceeds in the Construction Account, the Revenue Account or the Operating Account, as applicable, and the Trustee shall be required to make such deposit.

 Section 4.15    Access. 

Each of the Company and its Restricted Subsidiaries shall grant the Common Security Trustee or its designee from time to time, including during
the pendency of a Default or an Event of Default, upon reasonable prior written notice but no more than twice per calendar year (unless an Default or Event of Default has occurred and is continuing) reasonable access to all of its books and records
and the physical facilities of the Project, provided that all such inspections are conducted during normal business hours in a manner that does not disrupt the operation of the Project. So long as a Default or any Event of Default has
occurred and is continuing, the reasonable fees and documented expenses of such persons shall be for the account of the Company. 

  
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 Section 4.16    Insurance. 

Each of the Company and its Restricted Subsidiaries will keep the Project property of an insurable nature and of a character usually insured,
insured with financially sound insurers in such form and amounts as is necessary to insure the maximum probable loss for the Project. The Company will cause with limited exceptions, each insurance policy to name the Common Security Trustee on behalf
of the Secured Parties and the Secured Parties as loss payees as their interest may appear. 
 Section 4.17    Compliance with
Law. 
 Each of the Company and its Restricted Subsidiaries shall (a) comply with all Applicable Law (including environmental,
health and safety and port laws), except where such failure to comply could not reasonably be expected to have a Material Adverse Effect and (b) notify the Trustee promptly following the initiation of any proceedings or material disputes with
any Government Authority or other parties, which could reasonably be expected to have a Material Adverse Effect, relating to compliance or noncompliance with any such law, rule, regulation or order. 

Section 4.18    Use of Proceeds of Secured Debt. 

The Company will use the proceeds of the Secured Debt solely for purposes permitted in the applicable Secured Debt Instruments. 

Section 4.19    Project Document Termination Payments. 

(a) Within 15 days following the date on which the aggregate amount of Project Document Termination Payments received by the Company
exceeds $100,000,000, the Company will make a Project Document Termination Payment Offer in accordance with Section 3.09. The offer price in any Project Document Termination Payment Offer will be equal to 100% of the
principal amount plus accrued and unpaid interest to, but excluding, the date of purchase and will be payable in cash. If any Project Document Termination Payments remain after consummation of an Project Document Termination Payment Offer, the
Company may use those Project Document Termination Payments for any purpose not otherwise prohibited by this Indenture. Upon completion of each Project Document Termination Payment, the amount of Project Document Termination Payments for the
purposes of this paragraph will be reset at zero. 
 (b) The Company will comply with the requirements of
Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to a
Project Document Termination Payment Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of Section 3.09 or this Section 4.19, the Company
will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under Section 3.09 or this Section 4.19 by virtue of such conflict. 

  
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 (c) If the Trustee, on behalf of the Holders, receives any Project Document Termination Payments
applied to the prepayment of Secured Debt and other Obligations as provided in the Common Terms Agreement and this Indenture does not require the Company to make a Project Document Termination Payment Offer pursuant to
Section 3.09 and this Section 4.19, the Company shall instruct the Trustee to deposit such proceeds in the Construction Account, the Revenue Account or the Operating Account, as applicable, and the
Trustee shall make such deposit. 
 Section 4.20    LNG Sales Contracts. 

The Company will not enter into any LNG sales contracts except for (a) the Train One and Train Two LNG Sales Agreements, the Train Three
and Train Four LNG Sales Agreements and the Train Five LNG Sales Agreement, (b) the CMI LNG Sale and Purchase Agreement, (c) LNG sales contracts with counterparties who at the time of execution of the contract (1) have an Investment
Grade Rating from at least one Acceptable Rating Agency, or who provide a guaranty from an affiliate with at least one of such ratings or (2) have a direct or indirect parent with an Investment Grade Rating from at least one Acceptable Rating
Agency and either the counterparty or an affiliate of such counterparty who is providing a guaranty has a tangible net worth in excess of $15,000,000,000, (d) LNG sales contracts with a term of less than five years and greater than one year
with counterparties who do not at the time of execution of the contract have an Investment Grade Rating from at least one Acceptable Rating Agency to the extent the counterparty provides a letter of credit from a financial institution rated at least
A- by S&P or A3 by Moody’s (or, if any of such entities ceases to provide such ratings, the equivalent credit rating from any other Acceptable Rating Agency) with respect to its estimated obligations
under the contract for a period of 60 days, (e) LNG sales contracts with a term of one year or less, (f) LNG sales contracts with counterparties who prepay (in cash) for their LNG purchase obligations under such contracts, or (g) LNG
sales contracts otherwise approved by the Required Secured Parties; provided, that in the case of clauses (c), (d), (e), (f) and (g) above, performance under such contracts shall not adversely affect the ability of the Company to
meet its obligations under any contract listed in clause (a) above. 
 Section 4.21    Project Documents. 

(a) Each of the Company and its Restricted Subsidiaries shall comply in all material respects with its payment and other material obligations
under the Material Project Documents and Fundamental Government Approvals, except where the failure to so comply could not reasonably be expected to have a Material Adverse Effect. 

(b) The Company and the Restricted Subsidiaries shall notify the Trustee (1) when entering into or terminating any Material Project
Documents and provide a copy of any such contract to the Trustee and (2) promptly upon obtaining knowledge thereof, of any material adverse change in the status of any Fundamental Government Approval. 

  
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 (c) Each of the Company and its Restricted Subsidiaries shall not agree to any material amendment
or termination of any Material Project Document to which it is or becomes a party unless (1) a copy of such amendment or termination has been delivered to the Trustee at least 5 days in advance of the effective date thereof along with a
certificate of an Authorized Officer of the Company certifying that the proposed amendment or termination could not reasonably be expected to have a Material Adverse Effect or (2) the Company has obtained the consent of a majority of the
Holders to such amendment or termination. 
 Section 4.22    Project Construction; Maintenance of Properties. 

The Company will use its commercially reasonable efforts to perform, or cause to be performed, all work and services required or appropriate in
connection with the design, engineering, construction, testing and commencement of operations of the Project. 

Section 4.23    Maintenance of Liens. 

(a) The Company will grant a security interest to the Common Security Trustee in the Company’s interest in all Project assets and Project
Documents acquired or entered into, as applicable, from time to time (except to the extent expressly permitted to be excluded from the Liens created by the Security Documents pursuant to the terms thereof) and shall take, or cause to be taken, all
action reasonably required by the Common Security Trustee to maintain and preserve the Liens created by the Security Documents to which it is a party and the priority of such Liens. 

(b) The Company will from time to time execute or cause to be executed any and all further instruments (including financing statements,
continuation statements and similar statements with respect to any Security Document) reasonably requested by the Common Security Trustee for such purposes. 

(c) The Company will preserve and maintain good, legal and valid title to, or rights in, the Collateral free and clear of Liens other than
Permitted Liens. 
 (d) The Company will promptly discharge at the Company’s cost and expense, any Lien (other than Permitted Liens) on
the Collateral. 
 Section 4.24    Credit Rating Agencies. 

The Company shall use its commercially reasonable efforts to cause the Notes to be rated by at least two Recognized Credit Rating Agencies. If
any Recognized Credit Rating Agency ceases to be a “nationally recognized statistical rating organization” registered with the SEC or ceases to be in the business of rating securities of the type and nature of the Notes, the Company may
replace the rating received from it with a rating from any other Acceptable Rating Agency. 

  
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 Section 4.25    Additional Note Guarantees. 

If the Company or any of its Restricted Subsidiaries acquires or creates another Domestic Subsidiary, then such Domestic Subsidiary will become
a Guarantor and execute a supplemental indenture in the form attached hereto as Exhibit E (together with a corresponding Notation of Guarantee in the form attached hereto as Exhibit D) and deliver to the Trustee an Opinion of Counsel
within 15 Business Days of the date on which such Domestic Subsidiary is acquired or created; provided that any Domestic Restricted Subsidiary that constitutes an Immaterial Subsidiary need not become a Guarantor until such time as it
ceases to be an Immaterial Subsidiary. 
 Section 4.26    Separateness. 

The Company shall comply at all times with the separateness provisions set forth on Schedule 6.1 to the Common Terms Agreement. 

Section 4.27    Payments for Consent. 

The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder, in its capacity as a Holder, for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless such consideration is offered to be
paid and is paid to all Holders that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement. 

Section 4.28    Books and Records. 

The Company will, and will cause each of its Subsidiaries to, maintain proper books of record and account in conformity with GAAP and all
applicable requirements of any Government Authority having legal or regulatory jurisdiction over the Company or such Subsidiary, as the case may be. The Company will, and will cause each of its Subsidiaries to, keep books, records and accounts
which, in reasonable detail, accurately reflect all transactions and dispositions of assets. The Company and its Subsidiaries have devised a system of internal accounting controls sufficient to provide reasonable assurances that their respective
books, records, and accounts accurately reflect all transactions and dispositions of assets and the Company will, and will cause each of its Subsidiaries to, continue to maintain such system. 

Section 4.29    Economic Sanctions, Etc. 

The Company will not, and will not permit any Controlled Entity to (a) become (including by virtue of being owned or controlled by a
Blocked Person), own or control a Blocked Person or (b) directly or indirectly have any investment in or engage in any dealing or transaction (including any investment, dealing or transaction involving the proceeds of the Notes) with any Person
if such investment, dealing or transaction is prohibited by or subject to sanctions under any U.S. Economic Sanctions Laws. 

  
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 Section 4.30    Changes in Covenants when Notes No Longer Rated Investment Grade.

 (a) If, on any date, Parent (or any successor entity thereto) no longer has a rating from all Acceptable Rating Agencies that rate both
Parent (or any successor entity thereto) and the Company that is equivalent to or better than the Company’s rating from all Acceptable Rating Agencies that rate Parent (or any successor entity thereto) and the Company, then on such date (the
“Covenant Change Date”): 
 (i) the covenant set forth below shall come into force and effect: 

“Section 4.31     Transactions with Affiliates. 

(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into any
transaction that is otherwise permitted hereunder with or for the benefit of an Affiliate (including guarantees and assumptions of obligations of an Affiliate) (each, an “Affiliate Transaction”) involving aggregate payments or
consideration with respect to a single transaction or a series of related transactions, in excess of $25,000,000, except: 

(1) to the extent required by Applicable Law; 

(2) to the extent required or contemplated by the Material Project Documents or any other Project Document in existence on the
Notes Issue Date; 
 (3) upon terms no less favorable to the Company than would be obtained in a comparable arm’s-length transaction with a Person that is not an Affiliate, or, if no comparable arm’s-length transaction with a Person that is not an Affiliate is available,
then on terms that are determined by the Board of Directors of the Company to be fair in light of all factors considered by said Board of Directors to be pertinent to the Company; 

(4) for any Project processing, facilities sharing, use or similar agreement with an Affiliate of the Company; provided,
if applicable for the recovery by the Company, that the terms of such agreement provide for the recovery of at least the incremental Operation and Maintenance Expenses associated with operations pursuant to such agreement and the Company has
entered into the required Security Documents; and 
 (5) Subordinated Indebtedness between or among the Company, any of its
Restricted Subsidiaries and/or any of their Affiliates. 
 Prior to entering into any agreement with an Affiliate involving
aggregate consideration in excess of $50,000,000, the Company shall deliver to the Trustee a certificate of an Authorized Officer of the Company as to the satisfaction of the applicable condition set forth in clauses (2), (3), (4) and
(5) of this Section. 

  
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 (b) The following items will not be deemed to be Affiliate Transactions and,
therefore, will not be subject to the provisions of clause (a) of this Section: 
 (1) any employment agreement,
employee benefit plan, officer or director indemnification agreement or any similar arrangement entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business and payments pursuant thereto; 

(2) transactions between or among the Company and/or its Restricted Subsidiaries; 

(3) transactions with a Person (other than an Unrestricted Subsidiary of the Company) that is an Affiliate of the Company
solely because the Company owns, directly or through a Restricted Subsidiary, an Equity Interest in, or controls, such Person; 

(4) payment of reasonable directors’ fees to Persons who are not otherwise Affiliates of the Company; 

(5) any issuance of Equity Interests (other than Disqualified Stock) of the Company to Affiliates of the Company; 

(6) any (A) Permitted Investments or (B) Restricted Payments that do not violate
Section 4.06; 
 (7) Permitted Payments to Parent; 

(8) any contracts, agreements or understandings existing as of the Notes Issue Date and any amendments to or replacements of
such contracts, agreements or understandings so long as any such amendment or replacement is not more disadvantageous to the Company or to the Holders in any material respect than the original agreement as in effect on the Notes Issue Date; and 

(9) subject to Section 4.08(a)(1), any assignment, novation or transfer of any Train Five LNG Sales Agreement, any Train
Six LNG Sales Agreement or the CMI LNG Sale and Purchase Agreement by the Company to an Affiliate of the Company and any related agreements; provided, however, that if the Company incurs Expansion Debt in respect of Train Five or Train
Six pursuant, as applicable, to clause (a) of the definition of Permitted Indebtedness, any such assignment, novation or transfer of any Train Five LNG Sales Agreement or any Train Six LNG Sales Agreement, as applicable, and any related
agreements shall constitute an Affiliate Transaction unless such assignment, novation or transfer qualifies under any of the other listed exceptions in this section.” 

  
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 (ii) Clause (b) of the definition of “Unrestricted Subsidiary” will be replaced
with the following: 
 “(b) except as permitted by Section 4.31, is not party to any
agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted
Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company” 
 No Default, Event of Default or breach
of any kind shall be deemed to exist under this Indenture or the Notes with respect to the covenant set forth in Section 4.31(a) and neither the Company nor any of its Subsidiaries shall bear any liability for, any actions taken or events
occurring prior to the Covenant Change Date, regardless of whether such actions or events would have been permitted if the covenant were in effect prior to such date. 

(b) If, on any date following a Covenant Change Date, the following conditions are satisfied: 

(1) the Notes receive at least two Investment Grade Issue Ratings; 

(2) no Default or Event of Default shall have occurred and be continuing; and 

(3) Parent (or any successor entity thereto) has a rating from all Acceptable Rating Agencies that rate both Parent (or any successor entity
thereto) and the Company that is equivalent to or better than the Company’s rating from all Acceptable Rating Agencies that rate Parent (or any successor entity thereto) and the Company, 

then the covenant set forth in Section 4.31(a) will no longer be applicable to the Notes and clause (b) of the definition of
“Unrestricted Subsidiary” will revert to the initial definition included in this Indenture, beginning on such date and continuing until any subsequent Covenant Change Date. 

(c) In the event that subsequent to a Covenant Change Date the Company satisfies the conditions set forth in clauses (1), (2) and (3) of
Section 4.30(b), the Company will provide written notice of such event to the Trustee. 

  
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 ARTICLE 5 

SUCCESSORS 

Section 5.01    Merger, Consolidation, or Sale of Assets. 

The Company will not, directly or indirectly, consolidate, amalgamate or merge with or into another Person (regardless of whether the Company
is the surviving entity), convert into another form of entity or continue in another jurisdiction; or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of the properties or assets of the Company and its
Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person, unless: 
 (a) either: 

(1) the Company is the surviving entity; or 

(2) the Person formed by or surviving any such consolidation, amalgamation or merger or resulting from such conversion (if
other than the Company) or to which such sale, assignment, transfer, conveyance or other disposition has been made is a corporation, limited liability company or partnership organized or existing under the laws of the United States, any state of the
United States or the District of Columbia; 
 (b) the Person formed by or surviving any such conversion, consolidation, amalgamation, or
merger (if other than the Company) or the Person to which such sale, assignment, transfer, conveyance or other disposition has been made assumes all the obligations of the Company under the Notes, this Indenture and the Security Documents, pursuant
to a supplemental indenture and appropriate Security Documents; 
 (c) immediately after such transaction or transactions, no Default or
Event of Default exists; 
 (d) the Company shall have delivered to the Trustee a certificate from an Authorized Officer of the Company and
an Opinion of Counsel, each stating that such consolidation or merger, or sale or disposition and such supplemental indenture, Security Documents and registration rights agreement, if any, comply with this Indenture and that all conditions precedent
provided for in this Indenture relating to such transaction have been complied with; and 
 (e) either (i) the Company shall have
received letters from all Acceptable Rating Agencies then rating the Notes (or if only one Acceptable Rating Agency is then rating the Notes, the Company shall have received a letter from that Acceptable Rating Agency) to the effect that the
Acceptable Rating Agency has considered the contemplated transaction or transactions, and that, if the contemplated transaction or transactions are consummated, such Acceptable Rating Agency would reaffirm the then current rating of the Notes as of
the date of such transaction or transactions or (ii) the transaction or transactions have been consented to by Secured Debt Holders holding greater than 50% of the aggregate principal amount of Secured Debt then outstanding. 

  
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 Upon any consolidation, amalgamation or merger, or any transfer of all or substantially all of
the assets of the Company in accordance with this Section 5.01, the successor Person formed by such consolidation or amalgamation or into which the Company merged or to which such transfer is made will succeed to, and be
substituted for, and may exercise every right and power of, the Company under this Indenture and the Notes with the same effect as if such successor Person had been named as the Company in this Indenture and the Notes, and thereafter the predecessor
Person will have no continuing obligations under the Indenture, the Notes and the Security Documents (and such change shall not in any way constitute or be deemed to constitute a novation, discharge, rescission, extinguishment or substitution of the
existing Indebtedness and any Indebtedness so effected shall continue to be the same obligation and not a new obligation). 
 In addition,
the Company will not, directly or indirectly, lease all or substantially all of the properties and assets of it and its Restricted Subsidiaries taken as a whole, in one or more related transactions, to any other Person. This
Section 5.01 will not apply to any sale, assignment, transfer, conveyance, lease or other disposition of assets between or among the Company and the Guarantors. 

Clause (c) of this Section 5.01 will not apply to any merger or consolidation of the Company with or into an
Affiliate solely for the purpose of reincorporating the Company in another jurisdiction. 
 Section 5.02    Successor
Corporation Substituted. 
 Upon any consolidation or merger, or any sale, assignment, transfer, lease, conveyance or other disposition
of all or substantially all of the properties or assets of the Company in a transaction that is subject to, and that complies with the provisions of, Section 5.01, the successor Person formed by such consolidation or into
or with which the Company is merged or to which such sale, assignment, transfer, lease, conveyance or other disposition is made shall succeed to, and be substituted for (so that from and after the date of such consolidation, merger, sale,
assignment, transfer, lease, conveyance or other disposition, the provisions of this Indenture referring to the “Company” shall refer instead to the successor Person and not to the Company), and may exercise every right and power of the
Company under this Indenture with the same effect as if such successor Person had been named as the Company herein; provided, however, that the predecessor Company shall not be relieved from the obligation to pay the principal of and interest
on the Notes except in the case of a sale of all of the Company’s assets in a transaction that is subject to, and that complies with the provisions of, Section 5.01. 

  
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 ARTICLE 6 

DEFAULTS AND REMEDIES 

Section 6.01    Events of Default. 

Each of the following is an “Event of Default:” 

(1) any “Event of Default” specified in Section 9.1 of the Common Terms Agreement; provided, however,
that:(A) except with respect to any default in the payment when due of any principal of, or premium, if any, on the Notes, any default described in clause (i) of such Section 9.1 shall not constitute an “Event of
Default” for purposes of the Notes unless such default in the payment when due of any principal of any Secured Debt is in a principal amount in excess of $100,000,000, (B) any default described in clause (ii) of such
Section 9.1 shall not constitute an “Event of Default” for purposes of the Notes unless such default in the payment when due of any interest on any Secured Debt or any fee or any other amount or Obligation payable by the Company under
the Common Terms Agreement, any Secured Debt Instrument or any other Financing Documents continues unremedied for a period of 30 days after the occurrence of such default, (C) any waiver of any default in the payment when due of any principal
of, or premium, if any, or interest on the Notes shall not be effective, and will not be a waiver with respect to the Notes, unless such waiver is approved by greater than 50% in aggregate principal amount of the Notes then outstanding and
(D) no amendment or other modification to such Section 9.1 that results in (i) any default in the payment when due of any principal of, or premium, if any, or interest on the Notes not being an “Event of Default” under such
Section 9.1, (ii) an extension of the cure period with respect to the payment of principal of, or premium, if any, on the Notes or (iii) an extension of the cure period with respect to the payment of interest on the Notes to a period that
is greater than thirty (30) days, shall be effective with respect to the Notes unless such amendment or other modification is approved by greater than 50% in aggregate principal amount of the Notes then outstanding; 

(2) default with respect to any Indebtedness of the Company that is in excess of $100,000,000 in the aggregate (other than any
amount due in respect of Additional Secured Debt or Secured Bank Debt) and continued beyond any applicable grace period, the effect of which has been to cause the entire amount of such Indebtedness under this clause (2) to become due (whether
by redemption, purchase, offer to purchase or otherwise) and such Indebtedness under this clause (2) remains unpaid or the acceleration of its stated maturity unrescinded; 

(3) failure by the Company to comply with its obligations described under Section 5.01 or to
consummate a purchase of Notes when required pursuant to Section 4.09, 4.13, 4.14 or 4.19; 

(4) failure by the Company for 30 days to comply with the provisions of Section 4.07,
4.08 or 4.10; 
 (5) failure by the Company for 60 days after notice from the Trustee or the Holders
of at least 33 1⁄3% in aggregate principal amount of the then outstanding Notes to 

  
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comply with any of the other agreements in this Indenture or the Common Terms Agreement, to the extent applicable to the Notes, the Security Documents or the Notes unless covered by another Event
of Default; 
 (6) (a) any Default Contract or the Consent related to such Default Contract shall at any time for any
reason terminate (in each case, except in connection with its expiration in accordance with its terms in the ordinary course (and not related to any default or early termination right thereunder)) or (b) any other Material Project Document or
the Consent related to such Material Project Document shall terminate (in each case, except in connection with its expiration in accordance with its terms in the ordinary course (and not related to any default or early termination right thereunder))
and any such event under this clause (b) could reasonably be expected to result in a Material Adverse Effect; provided, however, that no Event of Default shall have occurred pursuant to this clause (6) if, in the case of the
occurrence of any of the events set forth in clause (a) or (b) above with respect to any Material Project Document or related Consent: 

(i) (A) the Company notifies the Common Security Trustee that it intends to replace such Material Project Document and
related Consent, (B) the Company diligently pursues such replacement, (C) the applicable Material Project Document is replaced within 360 days (except the Sabine Liquefaction TUA, which shall be replaced within 180 days) with a
replacement Material Project Document, (D) (I) in the case of any Facility LNG Sale and Purchase Agreement, such replacement Material Project Document is on terms and conditions, taken as a whole, not materially less favorable to the
Company than the then existing least favorable FOB Sale and Purchase Agreement, (II) in the case of the Sabine Liquefaction TUA, such replacement Material Project Document is on terms and conditions, taken as a whole, not materially less
favorable to the Company than the Sabine Liquefaction TUA, (III) in the case of the Train One and Train Two EPC Contract and the Train Three and Train Four EPC Contract, such replacement Material Project Document is on terms and conditions,
taken as a whole, not materially less favorable to the Company than the Train One and Train Two EPC Contract and the Train Three and Train Four EPC Contract, respectively, and (IV) in the case of any EPC Contract related to Train One and Train
Two, Train Three and Train Four, Train Five or Train Six, the counterparty to such replacement Material Project Document is an internationally recognized contractor and the Company shall have delivered to the Trustee a certificate of the Independent
Engineer, certifying that such counterparty is capable of completing the applicable Project Phase, and (E) in the case of any Facility LNG Sale and Purchase Agreement, the counterparty to any such replacement Material Project Document
(x) has an Investment Grade Rating from at least two Acceptable Rating Agencies, or provides a guaranty from an Affiliate that 

  
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has at least two of such ratings or (y) has a direct or indirect parent with an Investment Grade Rating from at least one Acceptable Rating Agency and either the counterparty or an Affiliate
of such counterparty who is providing a guaranty has a tangible net worth in excess of $15,000,000,000; provided that, clauses (D) and (E) shall not apply if such replacement Material Project Document is reasonably acceptable to
(x) if the Aggregate Secured Bank Debt then outstanding is equal to or greater than 25% of the total Secured Debt then outstanding, the Required Secured Parties, or (y) if the Aggregate Secured Bank Debt then outstanding is less than 25%
of the total Secured Debt then outstanding, Holders of greater than 50% in aggregate principal amount of the then outstanding Notes; or 

(ii) the Company shall have delivered to the Trustee a certificate of an Authorized Officer of the Company and the
certification set forth therein is confirmed by the Independent Engineer, certifying that (A) the present value of (x) the projected cash flows to be received by the Company pursuant to the Applicable Facility LNG Sale and Purchase
Agreements, minus (y) the projected expenses that could reasonably be expected to be incurred by the Company throughout the term of such Applicable Facility LNG Sale and Purchase Agreements is greater than (B) the sum of the outstanding
principal amount of Senior Debt (excluding Working Capital Debt, all Indebtedness or Guarantees incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08, and all
Indebtedness or Guarantees that would have been permitted to be incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08 of the 2013 Indenture prior to the Investment Grade Date) outstanding;
provided, that in calculating the present value of such cash flows, the discount rate shall be the weighted average interest rate of all the Indebtedness referred to in clause (B) and the discount period shall commence on the date of the
occurrence of the applicable event set forth in clause (a) or (b) above with respect to the applicable Material Project Document (and, with respect to any Applicable Facility LNG Sale and Purchase Agreement relating to a Train for which
the In-Service Date has not occurred as of such date, the cash flows to be received pursuant to the associated Applicable Facility LNG Sale and Purchase Agreements shall be deemed to commence on the Guaranteed
Substantial Completion Date for such Train); 
 (7) any event that would constitute an “Event of Default” under
Section 9.7 of the Common Terms Agreement shall occur with respect to the Company; provided, however, that (a) any waiver of any such “Event of Default” shall not be effective, and will not be a waiver, with respect to the
Notes, unless such waiver is approved by greater than 50% 

  
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in aggregate principal amount of the Notes then outstanding and (b) no amendment or other modification to such Section 9.7 that results in the occurrence of a Bankruptcy with respect to
the Company not being an “Event of Default” under such Section 9.7 shall be effective with respect to the Notes unless such amendment or other modification is approved by greater than 50% in aggregate principal amount of the Notes
then outstanding; 
 (8) a Bankruptcy shall occur with respect to (a) any party to one or more Default LNG Sale and
Purchase Agreements (other than the Company) (and such party has failed to meet its contractual obligations under the applicable Facility LNG Sale and Purchase Agreement for 180 consecutive days) or (b) (i) prior to the later of Final
Completion and “final completion” or similar concept in the Train Three and Train Four EPC Contract and (ii) after the Company incurs Expansion Debt in respect of Train Three and Train Four pursuant to clause (a) of the
definition of Permitted Indebtedness, the EPC Contractor or Bechtel Global Energy, Inc., unless: 
 (i) (A) the Company
notifies the Common Security Trustee that it intends to enter into a replacement Material Project Document in lieu of the Material Project Document to which any of the affected Persons is party, (B) the Company diligently pursues such
replacement, (C) the applicable Material Project Document is replaced not later than 180 days following the expiration of such 180 consecutive day period (except the Train One and Train Two EPC Contract, the Train Three and Train Four EPC
Contract, which shall be replaced within 360 days) (D) (I) in the case of any Facility LNG Sale and Purchase Agreement, such replacement Material Project Document is on terms and conditions, taken as a whole, not materially less
favorable to the Company than the then existing least favorable FOB Sale and Purchase Agreement, (II) in the case of the Train One and Train Two EPC Contract and the Train Three and Train Four EPC Contract, such replacement Material Project
Document is on terms and conditions, taken as a whole, not materially less favorable to the Company than the Train One and Train Two EPC Contract and the Train Three and Train Four EPC Contract, respectively, and (III) in the case of any
EPC Contract related to Train One and Train Two, Train Three and Train Four, Train Five or Train Six, the counterparty to such replacement Material Project Document is an internationally recognized contractor and the Company shall have delivered to
the Trustee a certificate of the Independent Engineer, certifying that such counterparty is capable of completing the applicable Project Phase and (E) in the case of any Facility LNG Sale and Purchase Agreement, the counterparty to any such
replacement Material Project Document (x) has an Investment Grade Rating from at least two Acceptable Rating Agencies, or provides a guaranty from an Affiliate that has at least two of such ratings or (y) has a

  
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direct or indirect parent with an Investment Grade Rating from at least one Acceptable Rating Agency and either the counterparty or an Affiliate of such counterparty who is providing a guaranty
has a tangible net worth in excess of $15,000,000,000; provided that, clauses (D) and (E) shall not apply if such replacement Material Project Document is reasonably acceptable to (x) if the Aggregate Secured Bank Debt then
outstanding is equal to or greater than 25% of the total Secured Debt then outstanding, the Required Secured Parties, or (y) if the Aggregate Secured Bank Debt then outstanding is less than 25% of the total Secured Debt then outstanding,
Holders of greater than 50% in aggregate principal amount of the then outstanding Notes; or 
 (ii) the Company shall have
delivered to the Trustee a certificate of an Authorized Officer of the Company and the certification set forth therein is confirmed by the Independent Engineer, certifying that (A) the present value of (x) the projected cash flows to be
received by the Company pursuant to the Applicable Facility LNG Sale and Purchase Agreements, minus (y) the projected expenses that could reasonably be expected to be incurred by the Company throughout the term of such Applicable Facility LNG
Sale and Purchase Agreements is greater than (B) the sum of the outstanding principal amount of Senior Debt (excluding Working Capital Debt, all Indebtedness or Guarantees incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m),
(o), (p) and (q) of Section 4.08, and all Indebtedness or Guarantees that would have been permitted to be incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08
of the 2013 Indenture prior to the Investment Grade Date) outstanding; provided, that in calculating the present value of such cash flows, the discount rate shall be the weighted average interest rate of all the Indebtedness referred to in
clause (B) and the discount period shall commence on the date such Bankruptcy occurs (and, with respect to any Applicable Facility LNG Sale and Purchase Agreement relating to a Train for which the
In-Service Date has not occurred as of such date, the cash flows to be received pursuant to the associated Applicable Facility LNG Sale and Purchase Agreements shall be deemed to commence on the Guaranteed
Substantial Completion Date for such Train); 
 (9) A final judgment or order, or series of judgments or orders, for the
payment of money in excess of $150,000,000 in the aggregate (net of insurance proceeds which are reasonably expected to be paid), in either case shall be rendered against any Loan Party, in each case, by one or more Government Authorities, arbitral
tribunals or other bodies having jurisdiction over any such entity and the same shall not be discharged (or provision shall not be made for such discharge), dismissed or stayed, within 90 days from the date of entry of such judgment or order or
judgments or orders; 

  
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 (10) the Common Terms Agreement or any other Financing Document or any material
provision of any Financing Document, (A) is declared by a court of competent jurisdiction to be illegal or unenforceable, (B) should otherwise cease to be valid and binding or in full force and effect or shall be materially Impaired (in
each case, except in connection with its expiration in accordance with its terms in the ordinary course (and not related to any default hereunder)) or (C) is (including the enforceability thereof) expressly terminated, contested or repudiated
by any Loan Party, the Parent, any Affiliate of any of them; 
 (11) the Liens in favor of the Secured Parties under the
Security Documents shall at any time cease to constitute valid and perfected Liens granting a first priority security interest in any material portion of the Collateral (subject to Permitted Liens); 

(12) an Event of Abandonment occurs or is deemed to have occurred; or 

(13) any representation or warranty made in writing by or on behalf of the Company or by any officer of the Company in the
Initial Notes Purchase Agreement thereby proves to have been false or incorrect in any material respect on the date as of which made; or 

(14) any Fundamental Government Approval related to the Company or the Project shall be Impaired and such Impairment could
reasonably be expected to have a Material Adverse Effect, unless: 
 (A) (i) the Company provides to the Trustee a
remediation plan (which sets forth the proposed steps to be taken to cure such Impairment) no later than 20 Business Days following the date that the Company has knowledge of the occurrence of such Impairment, (ii) the Company pursues the
implementation of such remediation plan, and (iii) such Impairment is cured no later than 360 days following the occurrence thereof; or 

(B) the Company shall have delivered to the Trustee a certificate of an Authorized Officer of the Company and the certification
set forth therein is confirmed by the Independent Engineer, certifying that (i) the present value of (x) the projected cash flows to be received by the Company pursuant to the Applicable Facility LNG Sale and Purchase Agreements, minus
(y) the projected expenses that could reasonably be expected to be incurred by the Company throughout the term of such Applicable Facility LNG Sale and Purchase Agreements is greater than (ii) the sum of the outstanding principal amount of
Senior Debt (excluding Working Capital Debt, all Indebtedness or Guarantees incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) of Section 4.08, and all Indebtedness or Guarantees that
would have been permitted to be incurred pursuant to clauses (f), (g), (h), (i), (j), (k), (l), (m), (o), (p) and (q) 

  
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of Section 4.08 of the 2013 Indenture prior to the Investment Grade Date) outstanding, in each case after giving effect to such Impairment; provided, that in calculating the present
value of such cash flows, the discount rate shall be the weighted average interest rate of all the Indebtedness referred to in clause (ii) and the discount period shall commence on the date of the occurrence of the applicable Impairment
event with respect to the applicable Fundamental Government Approval (and, with respect to any Applicable Facility LNG Sale and Purchase Agreement relating to a Train for which the In-Service Date has not
occurred as of such date, the cash flows to be received pursuant to the associated Applicable Facility LNG Sale and Purchase Agreements shall be deemed to commence on the Guaranteed Substantial Completion Date for such Train). 

Section 6.02    Acceleration. 

In the case of an Event of Default specified in clause (7) of Section 6.01, all outstanding Notes will become
due and payable immediately without further action or notice (subject to Applicable Law). If any other Event of Default occurs and is continuing, the Trustee or the Holders of at least 33 1⁄3% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately, by notice in writing to the Company, specifying the Event of Default. Upon any such declaration,
the Notes shall become due and payable immediately. 
 Upon any Notes becoming due and payable under this
Section 6.02, whether automatically or by declaration, such Notes will forthwith mature and the Optional Redemption Price determined with respect to such principal amount shall be immediately due and payable, in each and
every case without presentment, demand, protest or further notice, all of which are hereby waived. 
 Section 6.03    Other
Remedies. 
 If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of
principal and premium, if any, and interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture. 

The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Holder of a Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law. 
 Section 6.04    Waiver of Past Defaults. 

Holders of not less than a majority in aggregate principal amount of the then outstanding Notes by notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing 

  
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Default or Event of Default and its consequences hereunder, except a continuing Default or Event of Default in the payment of the principal of and premium, if any, or interest on, the Notes
(including in connection with an offer to purchase); provided, however, that the Holders of a majority in aggregate principal amount of the then outstanding Notes may rescind an acceleration and its consequences, including any related payment
default that resulted from such acceleration. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon. 
 Section 6.05    Control by Majority. 

Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee determines may be
unduly prejudicial to the rights of other Holders of Notes or that may involve the Trustee in personal liability. 

Section 6.06    Limitation on Suits. 

A Holder may pursue a remedy with respect to this Indenture or the Notes only if: 

(1) such Holder has previously given the Trustee written notice that an Event of Default is continuing; 

(2) Holders of at least 33 1⁄3%
in aggregate principal amount of the then outstanding Notes make a written request to the Trustee to pursue the remedy; 

(3) such Holder or Holders have offered the Trustee reasonable security or indemnity against any loss, liability or expense;

 (4) the Trustee has not complied with such request within 60 days after the receipt of the request and the offer
of security or indemnity; and 
 (5) Holders of a majority in aggregate principal amount of the then outstanding Notes have
not given the Trustee a direction inconsistent with such request within such 60-day period. 

A Holder of a Note may not use this Indenture to prejudice the rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note. 

  
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 Section 6.07    Rights of Holders of Notes to Receive Payment. 

Notwithstanding any other provision of this Indenture, the right of any Holder of a Note to receive payment of principal and premium, if any,
and interest on the Note, on or after the respective due dates expressed in the Note (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder; provided that a Holder shall not have the right to institute any such suit for the enforcement of payment if and to the extent that the institution or prosecution thereof or the entry
of judgment therein would, under Applicable Law, result in the surrender, impairment, waiver or loss of the Lien of this Indenture upon any property subject to such Lien. 

Section 6.08    Collection Suit by Trustee. 

If an Event of Default specified in Section 6.01(1) with respect to the Notes occurs and is continuing, the Trustee
is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal and premium, if any, and interest remaining unpaid on, the Notes and interest on overdue principal and, to the
extent lawful, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. 

Section 6.09    Trustee May File Proofs of Claim. 

The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other
obligor upon the Notes), its creditors or its property and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is
hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization
or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the
Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. 

  
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 Section 6.10    Priorities. 

If the Trustee collects any money pursuant to this Article 6, or, after an Event of Default, any money or other property distributable
in respect of the Company’s obligations under this Indenture, it shall pay out the money in the following order: 

First: to the Trustee (including any predecessor trustee), its agents and attorneys for amounts due under
Section 7.07, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection; 

Second: to Holders of Notes for amounts due and unpaid on the Notes for principal and premium, if any, and interest,
ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal and premium, if any, and interest, respectively; and 

Third: to the Company or to such party as a court of competent jurisdiction shall direct. 

The Trustee may fix a record date and payment date for any payment to Holders of Notes pursuant to this
Section 6.10. 
 Section 6.11    Undertaking for Costs. 

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted
by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’
fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07, or a suit by Holders of more than 10% in aggregate principal amount of the then outstanding Notes. 

ARTICLE 7 
 TRUSTEE 

Section 7.01    Duties of Trustee. 

(a) If an Event of Default has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs. 

  
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 (b) Except during the continuance of an Event of Default: 

(1) the duties of the Trustee will be determined solely by the express provisions of this Indenture and the Trustee need
perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and 

(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, in the case of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee will examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts, statements, opinions or conclusions stated therein). 
 (c) The Trustee may not be relieved from
liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: 

(1) this paragraph does not limit the effect of paragraphs (b) and (e) of this Section 7.01;

 (2) the Trustee will not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent facts; and 
 (3) the Trustee will not be liable with
respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05. 

(d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to this
Section 7.01. 
 (e) No provision of this Indenture will require the Trustee to expend or risk its own funds or
incur any liability. The Trustee will be under no obligation to exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holder has offered to the Trustee security and indemnity satisfactory to it against
any loss, liability or expense. 
 (f) The Trustee will not be liable for interest on any money received by it except as the Trustee may
agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. 

Section 7.02    Rights of Trustee. 

(a) The Trustee may conclusively rely upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other 

  
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evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Trustee need not investigate any fact or
matter stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation. 

(b) Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel or both;
provided that an Officer’s Certificate or Opinion of Counsel will not be required if the Indenture requires the Company to deliver a certificate of an Authorized Officer of the Company in connection with such act or refrain from acting.
The Trustee will not be liable for any action it takes, suffers or omits to take in good faith in reliance on such Officer’s Certificate, Opinion of Counsel or a certificate of an Authorized Officer of the Company. The Trustee may consult with
counsel and the advice of such counsel or any Opinion of Counsel will be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon. 

(c) The Trustee may act through its attorneys and agents and will not be responsible for the misconduct or negligence of any agent appointed
with due care. 
 (d) The Trustee will not be liable for any action it takes, suffers or omits to take in good faith that it believes to be
authorized or within the rights or powers conferred upon it by this Indenture. 
 (e) Unless otherwise specifically provided in this
Indenture, any demand, request, direction or notice from the Company will be sufficient if signed by an Authorized Officer of the Company. 

(f) The Trustee will be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction
of any of the Holders unless such Holders have offered to the Trustee indemnity or security satisfactory to the Trustee against the losses, liabilities and expenses that might be incurred by it in compliance with such request or direction. 

(g) The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of such Default or Event of Default is received by a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Notes and this Indenture. 

  
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 (h) The Trustee shall not be responsible or liable for any failure or delay in the performance of
its obligations under this Indenture arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation, acts of God; earthquakes; fire; flood; terrorism; wars and other military
disturbances; sabotage; epidemics; riots; interruptions; loss or malfunctions of utilities, computer (hardware or software) or communication services; accidents; labor disputes; acts of civil or military authority and governmental action. 

(i) The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder (and under the other Financing Documents to which it is a party) and each agent, custodian and other Person employed to act hereunder or
thereunder. 
 (j) The Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably
believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture. 
 (k) The Trustee may
request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which certificate may be signed by any person authorized to
sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded. 

(l) Anything in this Indenture notwithstanding, in no event shall the Trustee be liable for special, indirect, punitive or consequential or
other similar loss or damage of any kind whatsoever (including but not limited to loss of profit), even if the Trustee has been advised as to the likelihood of such loss or damage and regardless of the form of action. 

Section 7.03    Individual Rights of Trustee. 

The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights and duties. The Trustee is also subject to Section 7.10. 

Section 7.04    Trustee’s Disclaimer. 

The Trustee will not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not
be accountable for the Company’s use of the proceeds from the Notes or any money paid to the Company or upon the Company’s direction under any provision of this Indenture, it will not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it will not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other
than its certificate of authentication. 

  
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 The Trustee will not be responsible for the existence, genuineness or value of any of the
Collateral, for the validity, perfection, priority or enforceability of the Liens in any of the Collateral, whether impaired by operation of law or by reason of any action or omission to act on its part hereunder, except to the extent such action or
omission constitutes gross negligence, bad faith or willful misconduct on the part of the Trustee, for the validity or sufficiency of the Collateral or any agreement or assignment contained therein, for the validity of the title of the Company or
the Pledgor to the Collateral, for insuring the Collateral or for the payment of taxes, charges, assessments or Liens upon the Collateral or otherwise as to the maintenance of the Collateral. The Trustee hereby disclaims any representation or
warranty to the present and future holders of the Secured Obligations concerning the perfection of the Liens granted hereunder or in the value of any of the Collateral. For purposes of the two preceding sentences, the terms “Collateral,”
“Liens,” “Pledgor” and “Secured Obligations” shall have the meanings ascribed to such terms in the Collateral Trust Agreement. 

Section 7.05    Notice of Defaults. 

If a Default or Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee will mail to Holders of Notes a notice
of the Default or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on, any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders. 

Section 7.06    [Reserved.] 

Section 7.07    Compensation and Indemnity. 

(a) The Company will pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder.
The Trustee’s compensation will not be limited by any law on compensation of a trustee of an express trust. The Company will reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by
it in addition to the compensation for its services. Such expenses will include the reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel and of all Persons not regularly in its employ. 

(b) The Company and the Guarantors will indemnify each of the Trustee or any predecessor trustee and their officers, agents, directors and
employees for, and to hold them harmless against, any and all loss, damage, claims, liability or expense, including taxes (other than taxes based upon, measured by or determined by the income of the Trustee), incurred by it arising out of or in
connection with the acceptance or administration of its duties under this 

  
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Indenture and the Financing Documents, including the costs and expenses of enforcing this Indenture against the Company and the Guarantors (including this Section 7.07)
and defending itself against any claim (whether asserted by the Company, the Guarantors, any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder or thereunder, except to
the extent any such loss, liability or expense may be attributable to its gross negligence or willful misconduct. The Trustee will notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company will not relieve the Company or any of the Guarantors of their obligations hereunder. The Company or such Guarantor will defend the claim and the Trustee will cooperate in the defense. The Trustee may have separate counsel and the Company
will pay the reasonable fees and expenses of such counsel. Neither the Company nor any Guarantor need pay for any settlement made without its consent, which consent will not be unreasonably withheld. 

(c) The obligations of the Company and the Guarantors under this Section 7.07 will survive the satisfaction and
discharge of this Indenture, the termination for any reason of this Indenture and the resignation or removal of the Trustee. 
 (d) To
secure the Company’s and the Guarantors’ payment obligations in this Section 7.07, the Trustee will have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in
trust to pay principal and interest on particular Notes. Such Lien will survive the satisfaction and discharge of this Indenture, the termination for any reason of this Indenture and the resignation or removal of the Trustee. 

(e) When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(7)
occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law. 

(f) “Trustee” for purposes of this Section shall include any predecessor Trustee; provided, however, that the negligence,
willful misconduct or bad faith of any Trustee hereunder shall not affect the rights of any other Trustee hereunder. 

Section 7.08    Replacement of Trustee. 

(a) A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee’s
acceptance of appointment as provided in this Section 7.08. 
 (b) The Trustee may resign in writing at any time
and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in aggregate principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The
Company may remove the Trustee if: 
 (1) the Trustee fails to comply with Section 7.10; 

  
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 (2) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is
entered with respect to the Trustee under any Bankruptcy Law; 
 (3) a custodian or public officer takes charge of the
Trustee or its property; or 
 (4) the Trustee becomes incapable of acting. 

(c) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company will promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in aggregate principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the
Company. 
 (d) If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring
Trustee, the Company, or the Holders of at least 10% in aggregate principal amount of the then outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee. 

(e) If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with
Section 7.10, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. 

(f) A successor Trustee will deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee will become effective, and the successor Trustee will have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee will mail a notice of its succession to Holders.
The retiring Trustee will promptly transfer all property held by it as Trustee to the successor Trustee; provided all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in
Section 7.07. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Company’s obligations under Section 7.07 will continue for the benefit of
the retiring Trustee. 
 Section 7.09    Successor Trustee by Merger, etc. 

If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another Person,
the successor Person without any further act will be the successor Trustee. In case any Notes shall have been authenticated but not delivered by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating
Trustee may adopt such authentication and deliver the Notes so authenticated with the same effect as if such successor Trustee had itself authenticated such Notes. 

  
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 Section 7.10    Eligibility; Disqualification. 

There will at all times be a Trustee hereunder that is a Person organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least $100,000,000 as set
forth in its most recent published annual report of condition. 
 Section 7.11    Authorization to Enter Into Accession
Agreement. 
 The Trustee is hereby authorized to exercise all the rights and perform all the obligations of a Secured Debt Holder Group
Representative set out in the Accession Documents (as defined in the Accession Agreement), including, without limitation, making, on behalf of the Holders, the agreements expressed to be made by Secured Debt Holders under the Financing Documents.

 Section 7.12    Trustee Protective Provisions. 

Without duplication of any amounts the Trustee is entitled to recover under any indemnification provisions in the Financing Documents, the
rights, privileges, protections, indemnities, immunities and benefits provided to the Trustee in this Indenture are in addition to, and are not intended to be in conflict with or limited by, any such provisions in the Financing Documents. 

Section 7.13    Tax Withholding. 

The Trustee shall be entitled to deduct FATCA Withholding Tax from any payment hereunder, and shall have no obligation to gross-up any payment hereunder or to pay any additional amount as a result of such FATCA Withholding Tax deduction. 

ARTICLE 8 
 LEGAL DEFEASANCE AND
COVENANT DEFEASANCE 
 Section 8.01    Option to Effect Legal Defeasance or Covenant Defeasance. 

The Company may at any time, at the option of its Board of Directors evidenced by a resolution set forth in an Officer’s Certificate,
elect to have either Section 8.02 or 8.03 be applied to all outstanding Notes upon compliance with the conditions set forth below in this Article 8. 

Section 8.02    Legal Defeasance and Discharge. 

Upon the Company’s exercise under Section 8.01 of the option applicable to this
Section 8.02, the Company and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04, be deemed to have been discharged from their obligations with
respect to all outstanding Notes (including the Note Guarantees) on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that the Company and the
Guarantors will be deemed to have paid and discharged the entire 

  
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Indebtedness represented by the outstanding Notes (including the Note Guarantees), which will thereafter be deemed to be “outstanding” only for the purposes of
Section 8.05 and the other Sections of this Indenture referred to in clauses (1) and (2) below, and to have satisfied all their other obligations under such Notes, the Note Guarantees and this Indenture (and the
Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which will survive until otherwise terminated or discharged hereunder: 

(1) the rights of Holders of outstanding Notes to receive payments in respect of the principal of, or interest or premium, if
any, on, such Notes when such payments are due from the trust referred to in Section 8.04; 
 (2)
the Company’s obligations with respect to such Notes under Article 2 and Section 4.02; 

(3) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Company’s and the Guarantors’
obligations in connection therewith; and 
 (4) this Article 8. 

Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03. 
 Section 8.03    Covenant
Defeasance. 
 Upon the Company’s exercise under Section 8.01 of the option applicable to this
Section 8.03, the Company and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04, be released from each of their obligations under the covenants
contained in Sections 4.06 through 4.30 (and Section 4.31 if a Covenant Change Date has occurred) with respect to the outstanding Notes on and after the date the conditions set forth in
Section 8.04 are satisfied (hereinafter, “Covenant Defeasance”), and the Notes will thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act
of Holders (and the consequences of any thereof) in connection with such covenants, but will continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Notes will not be deemed outstanding for
accounting purposes). 
 For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes and Note Guarantees, the Company and the
Guarantors may omit to comply with and will have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by
reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply will not constitute a Default or an Event of Default under Section 6.01, but, except as
specified above, the remainder of this Indenture and such Notes and Note Guarantees will be unaffected thereby. In addition, upon the Company’s exercise under Section 8.01 of the option applicable to this
Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04, Sections 6.01(3) through 6.01(5) will not constitute Events of Default. 

  
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 Section 8.04    Conditions to Legal or Covenant Defeasance. 

In order to exercise either Legal Defeasance or Covenant Defeasance under either Section 8.02 or 8.03: 

(1) the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized investment bank, appraisal firm, or firm of independent public
accountants, to pay the principal of, premium, if any, and interest on, the outstanding Notes on the stated date for payment thereof or on the applicable redemption date, as the case may be, and the Company must specify whether the Notes are being
defeased to such stated date for payment or to a particular redemption date; 
 (2) in the case of an election under
Section 8.02, the Company has delivered to the Trustee an Opinion of Counsel confirming that: 

(A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling; or 

(B) since the Issue Date, there has been a change in the applicable federal income tax law, 

in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the outstanding Notes will not
recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal
Defeasance had not occurred; 
 (3) in the case of an election under Section 8.03, the Company must
deliver to the Trustee an Opinion of Counsel confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; 

(4) no Default or Event of Default shall have occurred and be continuing on the date of such deposit (other than a Default or
Event of Default resulting from the borrowing of funds to be applied to such deposit) and the deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or any Guarantor is a party
or by which the Company or any Guarantor is bound; 

  
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 (5) such Legal Defeasance or Covenant Defeasance will not result in a breach or
violation of, or constitute a default under, any material agreement or instrument (other than this Indenture) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound; 

(6) the Company must deliver to the Trustee an Officer’s Certificate stating that the deposit was not made by the Company
with the intent of preferring the Holders of Notes over the other creditors of the Company with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; 

(7) the Company must deliver to the Trustee an Officer’s Certificate stating that all conditions precedent set forth in
clauses (1) through (6) of this Section 8.04 have been complied with; and 
 (8) the Company
must deliver to the Trustee an Opinion of Counsel (which opinion of counsel may be subject to customary assumptions, qualifications and exclusions), stating that all conditions precedent set forth in clauses (2), (3) and (5) of this
Section 8.04 have been complied with; provided that the Opinion of Counsel with respect to clause (5) of this Section 8.04 may be to the knowledge of such counsel. 

Section 8.05    Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions. 

Subject to Section 8.06, all money and non-callable Government Securities
(including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the “Trustee”) pursuant to Section 8.04 in
respect of the outstanding Notes will be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as
Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such money need not be segregated from other funds except to the extent
required by law. 
 The Company will pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the
cash or non-callable Government Securities deposited pursuant to Section 8.04 or the principal and interest received in respect thereof other than any such tax, fee or other charge
which by law is for the account of the Holders of the outstanding Notes. 

  
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 Notwithstanding anything in this Article 8 to the contrary, the Trustee will deliver or
pay to the Company from time to time upon the request of the Company any money or non-callable Government Securities held by it as provided in Section 8.04 which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.04(1)), are in excess of the amount
thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance. 

Section 8.06    Repayment to Company. 

Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium,
if any, or interest on, any Note and remaining unclaimed for two years after such principal, premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) will be discharged from
such trust; and the Holder of such Note will thereafter be permitted to look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee
thereof, will thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in the New York Times and The Wall Street
Journal (national edition), notice that such money remains unclaimed and that, after a date specified therein, which will not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining
will be repaid to the Company. 
 Section 8.07    Reinstatement. 

If the Trustee or Paying Agent is unable to apply any U.S. dollars or non-callable Government
Securities in accordance with Section 8.02 or 8.03, as the case may be, by reason of any order or judgment of any court or Government Authority enjoining, restraining or otherwise prohibiting such application, then
the Company’s and the Guarantors’ obligations under this Indenture and the Notes and the Note Guarantees will be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03
until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.02 or 8.03, as the case may be; provided, however, that, if the Company makes any payment of
principal of, premium, if any, or interest on, any Note following the reinstatement of its obligations, the Company will be subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or Paying
Agent. 

  
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 ARTICLE 9 

AMENDMENT, SUPPLEMENT AND WAIVER 

Section 9.01    Without Consent of Holders of Notes. 

Notwithstanding Section 9.02, the Company, the Guarantors and the Trustee may amend or supplement the Notes and this
Indenture or the Note Guarantees without the consent of any Holder of Notes: 
 (1) to cure any ambiguity, defect or
inconsistency; 
 (2) to provide for uncertificated Notes in addition to or in place of certificated Notes; 

(3) to provide for the assumption of the Company’s or a Guarantor’s obligations to the Holders and Note Guarantees by
a successor to the Company or such Guarantor pursuant to Article 5 or Article 10; 
 (4) to effect the release
of a Guarantor from its Note Guarantee and the termination of such Note Guarantee, all in accordance with the provisions of this Indenture governing such release and termination; 

(5) to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect
the legal rights hereunder of any Holder; 
 (6) to provide for the issuance of Additional Notes in accordance with the
limitations set forth in this Indenture as of the Issue Date; 
 (7) to add any Note Guarantee; or 

(8) to provide for a successor Trustee in accordance with the provisions of this Indenture. 

Upon the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon receipt by the Trustee of the documents described in Section 7.02, the Trustee will join with the Company and the Guarantors in the execution of any amended or supplemental indenture
authorized or permitted by the terms of this Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee will not be obligated to enter into such amended or supplemental indenture that
affects its own rights, duties or immunities under this Indenture or otherwise. 
 Section 9.02    With Consent of Holders of
Notes. 
 Except as provided below in this Section 9.02, the Company and the Trustee may amend or supplement
this Indenture (including Section 3.09, 4.09, 4.13, 4.14 and 4.19) and the Notes and the Note Guarantees with the consent of the Holders of at least a majority in aggregate principal amount of
the then outstanding Notes (including, without limitation, Additional Notes, if any) voting as a single class, or if such amendment or supplement applies to less than all series 

  
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of Notes, all series affected by such amendment or supplement, of each series affected by such amendment or supplement (including consents obtained in connection with a tender offer or exchange
offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium, if any, or interest on, the
Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this Indenture or the Notes or the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate
principal amount of the then outstanding Notes (including, without limitation, Additional Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a tender offer or exchange offer for, or purchase
of, the Notes). Section 2.09 shall determine which Notes are considered to be “outstanding” for purposes of this Section 9.02. 

Upon the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon the filing with the Trustee of evidence satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by the Trustee of the documents described in
Section 7.02, the Trustee will join with the Company and the Guarantors in the execution of such amended or supplemental indenture unless such amended or supplemental indenture directly affects the Trustee’s own
rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but will not be obligated to, enter into such amended or supplemental Indenture. 

It is not be necessary for the consent of the Holders of Notes under this Section 9.02 to approve the particular
form of any proposed amendment, supplement or waiver, but it is sufficient if such consent approves the substance thereof. 
 After an
amendment, supplement or waiver under this Section 9.02 becomes effective, the Company will mail to the Holders of Notes affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, will not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver. Subject to Sections 6.04 and 6.07, the Holders of a majority in
aggregate principal amount of the Notes then outstanding voting as a single class may waive compliance in a particular instance by the Company with any provision of this Indenture or the Notes or the Note Guarantees. However, without the consent of
each Holder of each series of Notes affected, an amendment, supplement or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder): 

(1) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver; 

(2) reduce the principal of or change the fixed maturity of any Note or alter or waive any of the provisions with respect to
the redemption of the Notes; provided, however, that any purchase or repurchase of Notes, including pursuant to Sections 4.09, 4.13, 4.14 or 4.19 shall not be deemed a redemption of the Notes; 

  
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 (3) reduce the rate of or change the time for payment of interest, including
default interest, on any Note; 
 (4) waive a Default or Event of Default in the payment of principal of, or interest or
premium, if any, on the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the then outstanding Notes and a waiver of the payment default that resulted from such
acceleration); 
 (5) make any Note payable in money other than that stated in the Notes; 

(6) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of Holders of Notes
to receive payments of principal of, or interest or premium, if any, on the Notes; 
 (7) waive a redemption payment with
respect to any Note; provided, however, that any purchase or repurchase of Notes, including pursuant to Sections 4.09, 4.13, 4.14 or 4.19, shall not be deemed a redemption of the Notes; 

(8) release any Guarantor from any of its obligations under its Note Guarantee or this Indenture, except in accordance with the
terms of this Indenture; or 
 (9) make any change in the preceding amendment and waiver provisions. 

Section 9.03    Decisions under Other Financing Documents. 

(a) Notwithstanding any provision of this Indenture or the Intercreditor Agreement to the contrary, the Trustee shall be required, without the
requirement of any vote or consent by the Holders of Notes and without seeking noteholder vote, consent or direction with respect to any of the clauses set forth below to vote as follows: 

(1) for any Covered Action that is or includes any Fundamental Decision, if at the time no Secured Bank Debt is outstanding and
such Covered Action causes the provisions of the Financing Documents that are being amended to be no less restrictive on the Company than the covenants in this Indenture, the Trustee shall vote in favor of such Covered Action; 

(2) for any Covered Action while the Aggregate Secured Bank Debt then outstanding is less than 25% of the total Secured Debt
then outstanding, the Trustee shall vote in conformity with the Secured Bank Debt Holders to the extent that any such Covered Action causes the provisions of the Financing Documents that are being amended to be no less restrictive on the Company
than this Indenture, as set forth in a certificate of an Authorized Officer of the Company; 

  
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 (3) for any Covered Action that Modifies the provisions governing Expansion Debt
in the Common Terms Agreement, (A) if at the time both Aggregate Secured Bank Debt and Aggregate Other Secured Debt is outstanding, the Trustee shall vote in conformity with the Secured Bank Debt Holders to the extent that any such Covered
Action causes the provisions of the Financing Documents that are being amended to be no less restrictive on the Company than this Indenture, as set forth in a certificate of an Authorized Officer of the Company or (B) if at the time no Bank
Debt is outstanding and such Covered Action causes the provisions of the Financing Documents that are being amended to be no less restrictive on the Company that the covenants in this Indenture, the Trustee shall vote in favor of such Covered
Action; 
 (4) the Trustee shall vote in conformity with the Secured Bank Debt Holders with respect to any Unanimous Decision
set forth as (A) item (a), (b), (c), (d), (k), (m) or (n) on Schedule 1 to the Intercreditor Agreement and (B) item (l) on such Schedule (to the extent of the phrase thereof which reads “any Modification in any material respect
of any Security Document”), if the Modification contemplated by such Unanimous Decision Modification is not materially adverse to the Holders, or in the case of item (k) above is more restrictive on the Company, in each case as set forth
in a certificate of an Authorized Officer of the Company, upon which the Trustee may conclusively rely and will be fully protected in so relying, unless in any such case, such Unanimous Decision only applies to the Notes; 

(5) the Trustee shall vote in conformity with the Secured Bank Debt Holders with respect to any Unanimous Decision set forth as
item (g), (h) or (n) on Schedule 1 to the Intercreditor Agreement if the Modification contemplated by such Unanimous Decision does not result in the Notes receiving payments that are less than pari passu with the Secured Bank Debt (other
than due to timing differences in when payments are due on the Notes in accordance with their terms) and does not result in a material adverse change (when considered together with all other Modifications to any particular item specified in this
clause (5)), in each case, as set forth in a certificate of an Authorized Officer of the Company upon which the Trustee may conclusively rely and will be fully protected in so relying, in (A) the priority within clauses (i) through (viii)
of the waterfall of payments under Section 5.03 of the Accounts Agreement of any payment of principal, interest or other amounts payable (whether by prepayment or otherwise) under the Notes or (B) the funding of the Senior Secured Notes
Debt Service Reserve Account; 
 (6) the Trustee shall vote in conformity with the Secured Bank Debt Holders with respect to
any Unanimous Decision set forth as item (i) on Schedule 1 to the Intercreditor Agreement (to the extent it affects actions in respect of any Unanimous Decision set forth as item (e) or (f) on Schedule 1 to the Intercreditor Agreement) if
the Modification contemplated by such Unanimous Decision results in a Covered Action otherwise permitted by this Section 9.03; 

  
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 (7) if there is no Secured Bank Debt outstanding, the Trustee shall vote in favor
of any Covered Action with respect to any Unanimous Decision set forth as item (k) on Schedule 1 to the Intercreditor Agreement, if the Covered Action is either more restrictive on the Company than this Indenture or is not applicable, in each
case as set forth in a certificate of an Authorized Officer of the Company upon which the Trustee may conclusively rely and will be fully protected in so relying; 

(8) the Trustee shall vote in conformity with the Secured Bank Debt Holders with respect to any modification of the mandatory
prepayment provisions of the Common Terms Agreement that permits a Secured Debt Instrument to provide a higher mandatory prepayment threshold than the applicable threshold in the Common Terms Agreement, including to conform the Common Terms
Agreement to the mandatory prepayment thresholds set forth in this Indenture; 
 (9) notwithstanding the foregoing, in the
event any Export Credit Agency provides or guarantees debt financing for the Company, the Trustee shall consent to any of the following which are approved by the Secured Bank Debt Holders (A) any amendments or other modifications to the
Intercreditor Agreement or (ii) any amendments or other modifications to the Common Terms Agreement or the Accounts Agreement to provide (i) for a mandatory prepayment of the Indebtedness guaranteed by such Export Credit Agency if the
guaranty (or similar financial accommodation) is terminated or (ii) for mandatory prepayment of the Indebtedness issued to or guaranteed by such Export Credit Agency if a Facility LNG Sale and Purchase Agreement with a counterparty from the
country of origin of such Export Credit Agency, is terminated and in each case, that the Company indicates in a certificate of an Authorized Officer of the Company to the Trustee, upon which the Trustee may conclusively rely and will be fully
protected in so relying, are required to induce such Export Credit Agency to make or guarantee such debt financing to the Company; and 

(10) notwithstanding the foregoing, in the event that any Export Credit Agency provides or guarantees debt financing for the
Company, the Trustee shall consent to any of the following which are approved by the Secured Bank Debt Holders: (A) any amendments to the Intercreditor Agreement or (B) any amendments to the Common Terms Agreement to provide that
(i) if the Aggregate Secured Bank Debt then outstanding is less than 25% of the total Secured Debt then outstanding and the consent of the Majority Secured Debt Participants is required for any Majority Decision (as described above Section
4.1(iv) of the Intercreditor Agreement) and (ii) the Secured Debt held by any Export Credit Agency is at least 12% of the total Secured Debt then outstanding, the consent of such Export Credit Agency (or the Secured Debt Holder Group
Representative of such Export Credit Agency) shall be required; provided, 

  
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however, that the Company indicates in a certificate of an Authorized Officer of the Company to the Trustee, upon which the Trustee may conclusively rely and will be fully protected in so
relying, that such amendments are required to induce such Export Credit Agency to make or guarantee such debt financing to the Company. 

(b) Notwithstanding any provision of the Indenture or the Intercreditor Agreement to the contrary, if there is no Secured Bank Debt
outstanding, the Trustee shall vote at the direction of a majority of the aggregate outstanding principal amount of the Notes with respect to any Unanimous Decision set forth as (A) item (a), (b), (c), (d), (k), (m) or (n) on Schedule 1 to
the Intercreditor Agreement and (B) item (l) on such Schedule (to the extent of the phrase thereof which reads “any Modification in any material respect of any Security Document”). 

(c) Notwithstanding any provision of the Indenture or the Intercreditor Agreement to the contrary, to the extent that a vote of the Holders of
Notes is required in respect of any Covered Action with respect to any Unanimous Decision set forth as item (e), (g), (h) or (j) on Schedule 1 to the Intercreditor Agreement, the Trustee will act at the direction of the Holders of at least 75%
in aggregate principal amount of the outstanding debt securities of each series affected by such Covered Action, including the Notes and any Additional Notes. 

(d) Upon receipt of a certificate of an Authorized Officer of the Company and without the requirement of any vote or consent by the Holders of
Notes, the Trustee shall consent to any Administrative Decisions pursuant to the Intercreditor Agreement. 
 (e) Prior to voting in
accordance with this Section 9.03, the Trustee shall have received a certificate from an Authorized Officer of the Company, which certificate shall set forth (1) the vote or consent the Trustee is directed to make as required by this
Section 9.03 in connection with any vote required by the Trustee as Secured Debt Holder Group Representative under the Intercreditor Agreement or any other Financing Document and (2) the relevant subsection of this Section 9.03
pursuant to which such vote is required. 
 Section 9.04    Revocation and Effect of Consents. 

Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the amendment, supplement or waiver becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms
and thereafter binds every Holder. 

  
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 Section 9.05    Notation on or Exchange of Notes. 

The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment, supplement or waiver. 

Failure to make the appropriate notation or issue a new Note will not affect the validity and effect of such amendment, supplement or waiver.

 Section 9.06    Trustee to Sign Amendments, etc. 

The Trustee will sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does
not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Company may not sign an amended or supplemental indenture until the Board of Directors of the General Partner approves it. In executing any amended or
supplemental indenture, the Trustee will be entitled to receive and (subject to Section 7.01) will be fully protected in relying upon an Officer’s Certificate and an Opinion of Counsel stating that the execution of
such amended or supplemental indenture is authorized or permitted by this Indenture. 
 ARTICLE 10 

COLLATERAL AND SECURITY 

Section 10.01    Security. 

(a) The payment of the Notes, when due, and the performance of all other Secured Debt are secured equally and ratably by liens upon the
Company’s rights in the Collateral. The payment of the guarantees of each Guarantor and all other obligations of such Guarantor, when due, and the performance of all other obligations of such Guarantor with respect to Secured Debt under the
Secured Debt Documents are secured equally and ratably by liens upon such Guarantor’s rights in the Collateral. 
 (b) The Company
shall, and shall cause each of the Guarantors to, do or cause to be done all acts and things which may be required, or which the Common Security Trustee from time to time may reasonably request, to assure and confirm that the Common Security Trustee
holds, for the benefit of the Holders and the other Secured Debt, duly created, enforceable and perfected Liens upon the Collateral as contemplated by this Indenture and the Security Documents, so as to render the same available for the security and
benefit of this Indenture and of the Notes and Note Guarantees, according to the intent and purposes hereof expressed subject in each case to any express provisions of any Security Documents. 

  
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 Section 10.02    Security Documents. 

(a) The Notes, upon issuance, will be Secured Debt for purposes of the Common Terms Agreement and the Security Documents. The Trustee shall be
the Secured Debt Holder Group Representative for the Notes. The Holders shall be Senior Debt Holders. 
 (b) Upon the execution and delivery
of the Secured Debt Holder Group Representative Accession Agreement – Secured Debt Instrument (which document shall be substantially in the form attached as Schedule 2.7(a) to the Common Terms Agreement) (the “Accession
Agreement”), each Holder of the Initial Notes, by its acceptance of the Initial Notes instructs and directs the Trustee to execute and deliver the Accession Agreement, to which the Trustee and the Common Security Trustee will be a party on
the Notes Issue Date, the Notes will constitute additional New Secured Debt (as defined in the Accession Agreement) and Secured Debt that is pari passu with all other Secured Debt and will be secured by the Collateral equally and ratable with
the all other Secured Debt. 
 Section 10.03    Collateral 

(1) The Notes are secured, together with all other Secured Debt of the Company, equally and ratably by security interests
granted to the Common Security Trustee in all of the assets of the Company; and 
 (2) each Guarantor’s subsidiary
guarantees are secured, together with such Guarantor’s guarantee of all future Secured Debt of such Guarantor, equally and ratably by security interests granted to the Common Security Trustee in all assets of such Guarantor. 

Section 10.04    Release of Security Interests 

With respect to the Notes or each series of Notes, the Common Security Trustee’s Liens upon Collateral will no longer secure the
Obligations with respect to the Notes or that series of Notes and the right of the Holders of such Obligations to the benefits and proceeds of the Common Security Trustee’s Liens on Collateral will terminate and be discharged: 

(a) (1) upon satisfaction and discharge of this Indenture as set forth under in Section 12.01; 

(2) upon a Legal Defeasance or Covenant Defeasance with respect to that series of Notes as set forth in Article 8; or 

(3) upon payment in full in cash of the applicable Notes and all other related Note Obligations that are outstanding, due and payable at the
time the Notes are paid in full in cash; and 
 (b) in accordance with the Common Terms Agreement and the Intercreditor Agreement. 

  
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 Section 10.05    Release of Collateral. 

(a) Notwithstanding any provision of this Indenture to the contrary, Collateral may only be released from the Lien and security interest
created by the Security Documents at any time or from time to time in accordance with the provisions of the Intercreditor Agreement and the Security Documents. 

(b) No certificate shall be required in connection with any sale, transfer or other disposition of Collateral if such sale, transfer or other
disposition does not constitute an Asset Sale or is otherwise expressly permitted by the terms of any Security Document and such Security Document does not require delivery of such certificate and no instrument of release or other action of the
Common Security Trustee is required in connection with such release. 
 (c) The release of any Collateral from the terms of this Indenture
and the Security Documents will not be deemed to impair the security under this Indenture in contravention of the provisions hereof if and to the extent the Collateral is released pursuant to the terms of the Security Documents and none of the
certificate delivery requirements under Article 10 shall effect or impair the ability of the Company to obtain the release of any Collateral to the extent the Company complies with its obligations to obtain such release under the Security Documents,
Common Terms Agreement and Intercreditor Agreement. 
 Section 10.06    Certificates of the Trustee. 

In the event that the Company wishes to release Collateral in accordance with the Security Documents and has delivered the certificates and
documents required by the Security Documents, the Trustee will determine whether it has received all documentation required under this Indenture in connection with such release and, will deliver a certificate to the Common Security Trustee setting
forth such determination. 
 Section 10.07    Termination of Security Interest. 

Upon the payment in full of all Obligations of the Company under this Indenture and the Notes, or upon Legal Defeasance, the Trustee will, at
the request of the Company, deliver a certificate to the Common Security Trustee stating that such Obligations have been paid in full, and instruct the Common Security Trustee to release the Liens pursuant to this Indenture and the Security
Documents (subject to the satisfaction of any release of Lien provisions set forth in the Security Documents). 

  
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 ARTICLE 11 

NOTE GUARANTEES 

Section 11.01    Guarantee. 

(a) Subject to this Article 11, each of the Guarantors hereby, jointly and severally, unconditionally guarantees to each Holder of a
Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this Indenture, the Notes or the obligations of the Company hereunder or thereunder, that: 

(1) the principal of, premium, if any, and interest on, the Notes will be promptly paid in full when due, whether at maturity,
by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the Notes, if any, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be promptly paid in
full or performed, all in accordance with the terms hereof and thereof; and 
 (2) in case of any extension of time of
payment or renewal of any Notes or any of such other obligations, that same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. 

Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Guarantors will be jointly and
severally obligated to pay the same immediately. Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection. 

(b) The Guarantors hereby agree that their obligations hereunder are unconditional, irrespective of the validity, regularity or enforceability
of the Notes or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce
the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor. To the extent permitted by Applicable Law, each Guarantor hereby waives diligence, presentment, demand of payment, filing
of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever and covenant that this Note Guarantee will not be discharged
except by complete performance of the obligations contained in the Notes and this Indenture. 
 (c) If any Holder or the Trustee is required
by any court or otherwise to return to the Company, the Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Guarantors, any amount paid by either to the Trustee or such Holder,
this Note Guarantee, to the extent theretofore discharged, will be reinstated in full force and effect. 

  
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 (d) Each Guarantor agrees that it will not be entitled to any right of subrogation in relation to
the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby. Each Guarantor further agrees that, to the extent permitted by Applicable Law, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (2) in the event of any declaration of acceleration of such obligations as provided in Article 6, such obligations (whether or not due and
payable) will forthwith become due and payable by the Guarantors for the purpose of this Note Guarantee. The Guarantors will have the right to seek contribution from any non-paying Guarantor so long as the
exercise of such right does not impair the rights of the Holders under the Note Guarantee. 
 Section 11.02    Limitation on
Guarantor Liability. 
 Each Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such
parties that the Note Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to
the extent applicable to any Note Guarantee. To effectuate the foregoing intention, and to the extent permitted by Applicable Law, the Trustee, the Holders and the Guarantors hereby irrevocably agree that the obligations of such Guarantor will be
limited to the maximum amount that will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are relevant under such laws, and after giving effect to any collections from, rights to
receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under this Article 11, result in the obligations of such Guarantor under its Note Guarantee not
constituting a fraudulent transfer or conveyance. 
 Section 11.03    Execution and Delivery of Note Guarantee Notation.

 To evidence its Note Guarantee set forth in Section 11.01, each Guarantor hereby agrees that a notation of such
Note Guarantee substantially in the form attached as Exhibit D hereto or such other form as may be provided in any Supplemental Indenture will be endorsed by an Authorized Officer of such Guarantor on each Note authenticated and delivered by the
Trustee and that this Indenture will be executed on behalf of such Guarantor by one of its Authorized Officers. 
 Each Guarantor hereby
agrees that its Note Guarantee set forth in Section 11.01 will remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Note Guarantee. 

  
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 If an Authorized Officer whose signature is on this Indenture or on the Note Guarantee no longer
holds that office at the time the Trustee authenticates the Note on which a Note Guarantee is endorsed, the Note Guarantee will be valid nevertheless. 

The delivery of any Note by the Trustee, after the authentication thereof hereunder, will constitute due delivery of the Note Guarantee set
forth in this Indenture on behalf of the Guarantors. 
 In the event that the Company or any of its Restricted Subsidiaries creates or
acquires any Domestic Subsidiary after the date of this Indenture, if required by Section 4.25, the Company will cause such Domestic Subsidiary to comply with the provisions of Section 4.25 and
this Article 11, to the extent applicable. 
 Section 11.04    Guarantors May Consolidate, etc., on Certain Terms.

 Except as otherwise provided in Section 11.05, no Guarantor may sell or otherwise dispose of all or
substantially all of its assets to, or consolidate with or merge with or into (whether or not such Guarantor is the surviving Person) another Person, other than the Company or another Guarantor, unless: 

(1) immediately after giving effect to such transaction, no Default or Event of Default exists; 

(2) either: 

(a)    subject to Section 11.05, the Person acquiring the property in any such
sale or disposition or the Person formed by or surviving any such consolidation or merger unconditionally assumes all the obligations of that Guarantor under this Indenture and its Note Guarantee on the terms set forth herein or therein, pursuant to
a supplemental indenture, and appropriate Security Documents, in each case, in form and substance reasonably satisfactory to the Trustee; or 

(b)    the Net Proceeds of such sale or other disposition are applied in accordance with the applicable
provisions of this Indenture, including without limitation, Section 4.09; and 
 (3) the Company
shall have delivered to the Trustee a certificate from an Authorized Officer of the Company and an Opinion of Counsel, each stating that such consolidation or merger, or sale or disposition and such Supplemental Indenture and Security Documents, if
any, comply with this Indenture and that all conditions precedent provided for in this Indenture relating to such transaction have been complied with. 

In case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and 

  
 127 

 
satisfactory in form to the Trustee, of the Note Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by
the Guarantor, such successor Person will succeed to and be substituted for the Guarantor with the same effect as if it had been named herein as a Guarantor. Such successor Person thereupon may cause to be signed any or all of the Note Guarantees to
be endorsed upon all of the Notes issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee. All the Note Guarantees so issued will in all respects have the same legal rank and benefit under this
Indenture as the Note Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Note Guarantees had been issued at the date of the execution hereof. 

Except as set forth in Articles 4 and 5, and notwithstanding clauses 2(a) and (b) above, nothing contained in this
Indenture or in any of the Notes will prevent any consolidation or merger of a Guarantor with or into the Company or another Guarantor, or will prevent any sale or conveyance of the property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor. 
 Section 11.05    Releases. 

(a) In the event of any sale or other disposition of all or substantially all of the assets of any Guarantor, by way of merger, consolidation
or otherwise, or a sale or other disposition of all of the Capital Stock of any Guarantor, in each case to a Person that is not (either before or after giving effect to such transactions) the Company or a Restricted Subsidiary of the Company, then
such Guarantor (in the event of a sale or other disposition, by way of merger, consolidation or otherwise, of all of the Capital Stock of such Guarantor) or the corporation acquiring the property (in the event of a sale or other disposition of all
or substantially all of the assets of such Guarantor) will be released and relieved of any obligations under its Note Guarantee; provided that the Net Proceeds of such sale or other disposition are applied in accordance with the applicable
provisions of this Indenture, including Section 4.09; and provided further that such release shall not become effective until all such applicable provisions of this Indenture have been complied with in full. Upon
delivery by the Company to the Trustee of an Officer’s Certificate and an Opinion of Counsel to the effect that such sale or other disposition was made by the Company in accordance with the provisions of this Indenture, including
Section 4.09 the Trustee will execute any documents reasonably required in order to evidence the release of any Guarantor from its obligations under its Note Guarantee and any Security Documents to which it is a party. 

(b) Upon designation of any Guarantor as an Unrestricted Subsidiary in accordance with the terms of this Indenture, such Guarantor will be
released and relieved of any obligations under its Note Guarantee and any Security Documents to which it is a party. 

  
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 (c) Upon Legal Defeasance in accordance with Article 8 or satisfaction and discharge of
this Indenture in accordance with Article 12, each Guarantor will be released and relieved of any obligations under its Note Guarantee and any Security Documents to which it is a party. 

Any Guarantor not released from its obligations under its Note Guarantee as provided in this Section 11.05 will
remain liable for the full amount of principal of and interest and premium, if any, on the Notes and for the other obligations of any Guarantor under this Indenture as provided in this Article 11. 

ARTICLE 12 
 SATISFACTION AND
DISCHARGE 
 Section 12.01    Satisfaction and Discharge. 

This Indenture will be discharged and will cease to be of further effect as to all Notes issued hereunder, when: 

(1) either: 

(a)    all Notes that have been authenticated, except lost, stolen or destroyed Notes that have been
replaced or paid and Notes for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company, have been delivered to the Trustee for cancellation; or 

(b)    all Notes that have not been delivered to the Trustee for cancellation have become due and payable
by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and the Company or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for
the benefit of the Holders, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized investment bank,
appraisal firm or firm of independent public accountants, without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the Notes not delivered to the Trustee for cancellation for principal, premium, if any,
and accrued interest to the date of maturity or redemption; 
 (2) no Default or Event of Default has occurred and is
continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit); 

(3) such deposit will not result in a breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Company or any Guarantor is a party or by which the Company or any Guarantor is bound; 

  
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 (4) the Company or any Guarantor has paid or caused to be paid all sums payable
by it under this Indenture; and 
 (5) the Company has delivered irrevocable instructions to the Trustee under this Indenture
to apply the deposited money toward the payment of the Notes at maturity or the redemption date, as the case may be. 
 In addition, the Company must
deliver to the Trustee (a) an Officer’s Certificate stating that all conditions precedent set forth in clauses (1) through (5) of this Section 12.01 have been satisfied, and (b) an Opinion of Counsel
(which opinion of counsel may be subject to customary assumptions and qualifications), stating that all conditions precedent set forth in clauses (3) and (5) of this Section 12.01 have been satisfied; provided that the
Opinion of Counsel with respect to clause (3) of this Section 12.01 may be to the knowledge of such counsel. 

Notwithstanding the satisfaction and discharge of this Indenture, if money has been deposited with the Trustee pursuant to subclause
(b) of clause (1) of this Section 12.01, the provisions of Sections 12.02 and 8.06 will survive. In addition, nothing in this Section 12.01 will be deemed to discharge those
provisions of Section 7.07, that, by their terms, survive the satisfaction and discharge of this Indenture. 

Section 12.02    Application of Trust Money. 

Subject to the provisions of Section 8.06, all money deposited with the Trustee pursuant to
Section 12.01 shall be held in trust and applied by it, in accordance with the provisions of the Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium and Additional, if any) and interest for whose payment such money has been deposited with the Trustee; but such money need not be segregated
from other funds except to the extent required by law. 
 If the Trustee or Paying Agent is unable to apply any money or Government
Securities in accordance with Section 12.01 by reason of any legal proceeding or by reason of any order or judgment of any court or Government Authority enjoining, restraining or otherwise prohibiting such application, the
Company’s and any Guarantor’s obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 12.01; provided that if the Company has
made any payment of principal of, premium, if any, or interest on, any Notes because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or
Government Securities held by the Trustee or Paying Agent. 

  
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 ARTICLE 13 

MISCELLANEOUS 

Section 13.01    Notices. 

Any notice or communication by the Company, any Guarantor or the Trustee to the others is duly given if in writing and delivered in Person or
by first class mail (registered or certified, return receipt requested), facsimile transmission, electronic mail or overnight air courier guaranteeing next day delivery, to the others’ address: 

If to the Company and/or any Guarantor: 

Sabine Pass Liquefaction, LLC 

c/o Cheniere Energy, Inc. 
 700
Milam Street, Suite 1900 
 Houston, TX 77002 

Facsimile No.: (713) 375-6000 

E-mail: Lisa.Cohen@cheniere.com 

Attention: Treasurer 
 With a
copy to (which copy shall be delivered as an accommodation and shall not be required to be delivered in satisfaction of any requirement hereof): 

Latham & Watkins LLP 

885 Third Avenue 
 New York, NY
10022-4834 
 Facsimile No.: 212-751-4864 

E-mail: jonathan.rod@lw.com 

Attention: Jonathan R. Rod 
 If
to the Trustee: 
 The Bank of New York Mellon 

500 Ross Street, 12th Floor 

Pittsburgh, PA 15262 
 Facsimile
No.: (412) 234-8377 
 E-mail: margaret.brown@bnymellon.com

 Attention: Corporate Trust Administration 

The Company, any Guarantor or the Trustee, by notice to the others, may designate additional or different addresses for subsequent notices or
communications. 
 All notices and communications (other than those sent to Holders) will be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if transmitted by facsimile; at the time sent, if transmitted by electronic mail; and the next
Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery; provided that all notices and communications to the Trustee shall not be deemed received by the Trustee unless actually
received by the Trustee at its address, facsimile number or electronic mail address set forth above. 

  
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 Any notice or communication to a Holder will be mailed by first class mail, or by certified or
registered mail, return receipt requested, or by overnight air courier guaranteeing next day delivery to its address shown on the register kept by the Registrar. Failure to mail a notice or communication to a Holder or any defect in it will not
affect its sufficiency with respect to other Holders. 
 If a notice or communication is mailed in the manner provided above within the time
prescribed, it is duly given, whether or not the addressee receives it. 
 If the Company mails a notice or communication to Holders, it
will send a copy to the Trustee and each Agent at the same time by any of the means described above with respect to notice or communication by the Company. 

The Trustee shall have the right, but shall not be required, to rely upon and comply with notices, instructions, directions or other
communications sent by electronic mail, facsimile and other similar unsecured electronic methods by persons believed by the Trustee to be authorized to give instructions and directions on behalf of the Company. The Trustee shall have no duty or
obligation to verify or confirm that the person who sent such instructions or directions is, in fact, a person authorized to give instructions or directions on behalf of the Company; and the Trustee shall have no liability for any losses,
liabilities, costs or expenses incurred or sustained by the Company as a result of such reliance upon or compliance with such notices, instructions, directions or other communications. The Company agrees to assume all risks arising out of the use of
such electronic methods to submit notices, instructions, directions or other communications to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third
parties. The Company shall use all reasonable endeavors to ensure that any such notices, instructions, directions or other communications transmitted to the Trustee pursuant to this Indenture are complete and correct. Any such notices, instructions,
directions or other communications shall be conclusively deemed to be valid instructions from the Company to the Trustee for the purposes of this Indenture. 

Section 13.02    Certificate and Opinion as to Conditions Precedent. 

Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the
Trustee: 
 (1) an Officer’s Certificate in form reasonably satisfactory to the Trustee (which must include the
statements set forth in Section 13.03) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and

  
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 (2) an Opinion of Counsel in form reasonably satisfactory to the Trustee (which
must include the statements set forth in Section 13.03) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with. 

Section 13.03    Statements Required in Certificate or Opinion. 

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture must include: 

(1) a statement that the Person making such certificate or opinion has read such covenant or condition; 

(2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based; 
 (3) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been complied with; and 

(4) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been complied with. 

Section 13.04    Rules by Trustee and Agents. 

The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions. 
 Section 13.05    No Personal Liability of Directors, Officers, Employees and
Stockholders. 
 No past, present or future director, manager, officer, employee, incorporator, member, partner or stockholder of the
Company or any Guarantor (including without limitation, the General Partner and the Parent), as such, will have any liability for any obligations of the Company or the Guarantors under the Notes, this Indenture, the Note Guarantees, the Security
Documents, the Financing Documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes. 
 Section 13.06    Governing Law; Waiver of Jury Trial; Jurisdiction. 

(a) THE LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW. 

  
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 (b) Each of the Company, any Guarantors and the Trustee, and each Holder of a Note, by its
acceptance thereof, hereby irrevocably waives, to the fullest extent permitted by Applicable Law, any and all right it may have to trial by jury in any legal proceeding directly or indirectly arising out of or relating to this Indenture, the
securities or the transactions contemplated hereby or thereby. 
 (c) Each of the Company and each Guarantor, if any, irrevocably consents
and submits, for itself and in respect of any of its assets or property, to the non-exclusive jurisdiction of any court of the State of New York or any United States federal court sitting, in each case, in the
Borough of Manhattan, the City of New York, New York, United States of America, and any appellate court from any thereof in any suit, action or proceeding that may be brought in connection with this Indenture or the securities, and waives any
immunity from the jurisdiction of such courts. Each of the Company and each Guarantor, if any, irrevocably waives, to the fullest extent permitted by law, any objection to any such suit, action or proceeding that may be brought in such courts
whether on the grounds of venue, residence or domicile or on the ground that any such suit, action or proceeding has been brought in an inconvenient forum. Each of the Company and each Guarantor, if any, agrees, to the fullest extent that it
lawfully may do so, that final judgment in any such suit, action or proceeding brought in such a court shall be conclusive and binding upon the Company and any Guarantor, if any, as applicable, and each of the Company and any Guarantor, if any,
waives, to the fullest extent permitted by law, any objection to the enforcement by any competent court in the Company’s and the applicable Guarantor’s, as applicable, jurisdiction of organization of judgments validly obtained in any such
court in New York on the basis of such suit, action or proceeding; provided, however, that neither the Company nor any Guarantor waive, and the foregoing provisions of this sentence shall not constitute or be deemed to constitute a waiver of,
(i) any right to appeal any such judgment, to seek any stay or otherwise to seek reconsideration or review of any such judgment or (ii) any stay of execution or levy pending an appeal from, or a suit, action or proceeding for
reconsideration of, any such judgment. 
 Section 13.07    No Adverse Interpretation of Other Agreements. 

This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. 

Section 13.08    Successors. 

All agreements of the Company in this Indenture and the Notes will bind its successors. All agreements of the Trustee in this Indenture will
bind its successors. All agreements of each Guarantor in this Indenture will bind its successors, except as otherwise provided in Section 11.05. 

  
 134 

 Section 13.09    Severability. 

In case any provision in this Indenture or in the Notes is invalid, illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions will not in any way be affected or impaired thereby. 
 Section 13.10    Counterpart Originals. 

The parties may sign any number of copies of this Indenture. Each signed copy will be an original, but all of them together represent the same
agreement. The exchange of copies of this Indenture and of signature pages by facsimile or electronic format (i.e., “pdf” or “tif”) transmission shall constitute effective execution and delivery of this Indenture as to the
parties hereto and may be used in lieu of the original Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or electronic format (i.e., “pdf” or “tif”) shall be deemed to be their original
signatures for all purposes. 
 Section 13.11    Trustee’s Receipt of Funds to the Extent not Required to be
Applied to Payment of the Notes 
 To the extent the Trustee receives any money from the Company or pursuant to any of the Financing
Documents, and such money is not required to be used to redeem or repay the Notes as set forth in the certificate of an Authorized Officer of the Company, such moneys shall be deposited into the Account under the Accounts Agreement as specified by
the Company in such certificate. 
 Section 13.12    Table of Contents, Headings, etc. 

The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and will in no way modify or restrict any of the terms or provisions hereof. 

[Signatures on following page] 

  
 135 

 SIGNATURES 

Dated as of February 24, 2017 
  

			
	SABINE PASS LIQUEFACTION, LLC
		
	By:	 	 /s/ Michael J. Wortley

	Name:	 	Michael J. Wortley
	Title:	 	Chief Financial Officer
	
	 THE BANK OF NEW YORK MELLON,
 as
Trustee

		
	By:	 	 /s/ John D. Bowman

	Name:	 	John D. Bowman
	Title:	 	Vice President

 APPENDIX A 

PROVISIONS RELATING TO INITIAL NOTES AND ADDITIONAL NOTES 

Section 1.1    Definitions 

Capitalized terms used but not defined in this Appendix A have the meanings given to them in the Indenture. 

Section 2.1    Form and Dating. 

(a) Definitive Notes. The Notes will be issued initially in Definitive Note form. Notes issued in Definitive Note form will be
substantially in the form of Exhibit A-1 (but without the Global Note Legend thereon and without the “Schedule of Exchanges of Interests in the Global Note” attached thereto) in an aggregate
denomination equal to (i) in the case of the Initial Notes $800,000,000 and (ii) in the case of any Additional Notes the aggregate initial principal amount of such Notes. 

(b) Global Notes. Except as otherwise provided in this Section 2.1, Notes issued in global form (and the
Trustee’s certificate of authentication of such Notes) will be substantially in the form of Exhibit A-1 (including the Global Note Legend thereon and the “Schedule of Exchanges of Interests in
the Global Note” attached thereto). Each such Note will be dated the date of its authentication. Each Global Note will represent such of the outstanding Notes as will be specified therein and each shall provide that it represents the aggregate
principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby will be made by the Trustee or the Custodian, at the direction of the Trustee,
in accordance with instructions given by the Holder thereof as required by Section 2.3. 
 (c) Temporary Global
Notes. If Notes are exchanged in accordance with Section 2.3(a) during the Restricted Period, any such Notes initially offered and sold in reliance on Regulation S will be issued in a denomination equal to the outstanding principal amount of
such Notes in the form of Exhibit A-2. Such Notes will be deposited on behalf of the purchasers of the Notes represented thereby with or on behalf of, and registered in the name of, the Depositary or
the nominee of the Depositary for the accounts of designated agents holding on behalf of Euroclear or Clearstream, duly executed by the Company and authenticated by the Trustee as hereinafter provided. The Restricted Period will be terminated upon
the receipt by the Trustee of: 
 (1) a written certificate from the Depositary, together with copies of certificates from
Euroclear and Clearstream certifying that they have received certification of non-United States beneficial ownership of 100% of the aggregate principal amount of the

 
Regulation S Temporary Global Note (except to the extent of any beneficial owners thereof who acquired an interest therein during the Restricted Period pursuant to another exemption from
registration under the Securities Act and who will take delivery of a beneficial ownership interest in (A) a Global Note substantially in the form of Exhibit A-1, bearing the Global Note Legend and
the Private Placement Legend, deposited with or on behalf of, and registered in the name of, the Depositary or its nominee, and issued in a denomination equal to the outstanding principal amount of the Notes sold in reliance on Rule 144A or
(B) a Global Note bearing the Global Note Legend and the Private Placement Legend, deposited with or on behalf of, and registered in the name of, the Depositary or the nominee of the Depositary, and issued in a denomination equal to the
outstanding principal amount of Notes sold to Institutional Accredited Investors, all as contemplated by Section 2.3(c)); and 

(2) an Officer’s Certificate from the Company. 

Following the termination of the Restricted Period with respect to any Notes, beneficial interests in the Regulation S Temporary Global Note
will be exchanged, pursuant to the Applicable Procedures, for beneficial interests in a permanent Global Note, which will be in the form of Exhibit A-1 bearing the Global Note Legend and the Private
Placement Legend, deposited with or on behalf of, and registered in the name of, the Depositary or the nominee of the Depositary, and issued in a denomination equal to the outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period. Simultaneously with the authentication of the Regulation S Permanent Global Note, the Trustee will cancel the Regulation S Temporary Global Note. The aggregate principal amount of the Regulation S Temporary
Global Note and the Regulation S Permanent Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee and the Depositary or its nominee, as the case may be, in connection with transfers of interest
as hereinafter provided. 
 (3) Euroclear and Clearstream Procedures Applicable. The provisions of the “Operating
Procedures of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear” and the “General Terms and Conditions of Clearstream Banking” and “Customer Handbook” of Clearstream will be applicable to
transfers of beneficial interests in the Regulation S Temporary Global Note and the Regulation S Permanent Global Note that are held by Participants through Euroclear or Clearstream. 

(d) Additional Notes. Subject to compliance with the provisions of this Indenture, the Company may from time to time after the Issue
Date issue Additional Notes as provided in Exhibit F, which is incorporated by reference in this Section 2.1(d). 

Section 2.2    Holder Lists. 

The Trustee will preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of
all Holders. If the Trustee is not the Registrar, the Company will furnish to the Trustee at least seven Business Days before each Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of the Holders of Notes. 

 Section 2.3    Transfer and Exchange. 

(a) Initial Exchange of Notes. A particular series of Notes, which will be initially issued in Definitive Note form, may be exchanged in
aggregate for beneficial interests in Global Notes if requested by Holders of a majority in aggregate principal amount of such Notes then outstanding, voting as a single class. 

Upon receipt of such request for exchange, the Trustee, in accordance with Section 7.02 of the Indenture will cancel
such Notes and the Company will issue and, upon receipt of an Authentication Order in accordance with Section 2.04 of the Indenture, the Trustee will authenticate one or more Restricted Global Notes, Unrestricted Global
Notes or Regulation S Temporary Global Notes, as applicable, in accordance with Section 2.1. Holders will receive beneficial interests in the aggregate principal amount of Restricted Global Notes, Unrestricted Global Notes or Regulation S
Temporary Global Notes, as applicable. 
 (b) Transfer and Exchange of Global Notes. A Global Note may not be transferred except as a
whole by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor
Depositary. All Global Notes will be exchanged by the Company for Definitive Notes if: 
 (1) the Company delivers to the
Trustee notice from the Depositary that it is unwilling or unable to continue to act as Depositary for the Global Notes or that it has ceased to be a clearing agency registered under the Exchange Act and, in either case, a successor Depositary is
not appointed by the Company within 120 days after the date of such notice from the Depositary; 
 (2) the Company in its
sole discretion determines that the Global Notes (in whole but not in part) should be exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee; provided that in no event shall the Regulation S Temporary
Global Note be exchanged by the Company for Definitive Notes prior to (A) the expiration of the Restricted Period and (B) the receipt by the Registrar of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act;
or 
 (3) there has occurred and is continuing an Event of Default with respect to the Notes. 

Upon the occurrence of either of the preceding events in (1) or (2) above, Definitive Notes shall be issued in such names as the
Depositary shall instruct the Trustee. Global Notes also may be exchanged or replaced, in whole or in part, as provided in Sections 2.08 and 2.11 of the Indenture. Every Note authenticated and delivered in exchange for, or in lieu of,
a Global Note or any portion thereof, pursuant to this Section 2.3 or Sections 2.08 or 2.11 of the Indenture, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may
not be exchanged for another Note other than as provided in this Section 2.3(b), however, beneficial interests in a Global Note may be transferred and exchanged as provided in Section 2.3(c), (d) or (g). 

 (c) Transfer and Exchange of Beneficial Interests in the Global Notes. The transfer and
exchange of beneficial interests in the Global Notes will be effected through the Depositary, in accordance with the provisions of this Indenture and the Applicable Procedures. Beneficial interests in the Restricted Global Notes will be subject to
restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Transfers of beneficial interests in the Global Notes also will require compliance with either subparagraph (1) or (2) below, as
applicable, as well as one or more of the other following subparagraphs, as applicable: 
 (1) Transfer of Beneficial
Interests in the Same Global Note. Beneficial interests in any Restricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however, that prior to the expiration of the Restricted Period, transfers of beneficial interests in the Regulation S Temporary Global Note may not be made to a U.S. Person or
for the account or benefit of a U.S. Person (other than the Initial Purchasers). Beneficial interests in any Unrestricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note. No written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.3(c)(1). 

(2) All Other Transfers and Exchanges of Beneficial Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section 2.3(c)(1), the transferor of such beneficial interest must deliver to the Registrar either: 

(A) both: 

(i) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Note in an amount equal to the beneficial interest to be transferred or exchanged; and 

(ii) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account
to be credited with such increase; or 
 (B) both: 

(i) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to cause to be issued a Definitive Note in an amount equal to the beneficial interest to be transferred or exchanged; and 

(ii) instructions given by the Depositary to the Registrar containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or exchange referred to in (1) above; 

 provided that in no event shall Definitive Notes be issued upon the transfer or exchange
of beneficial interests in the Regulation S Temporary Global Note prior to (A) the expiration of the Restricted Period and (B) the receipt by the Registrar of any certificates required pursuant to Rule 903 under the Securities Act. 

(3) Transfer of Beneficial Interests to Another Restricted Global Note. A beneficial interest in any Restricted Global
Note may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Note if the transfer complies with the requirements of Section 2.3(c)(2) and the Registrar receives the
following: 
 (A) if the transferee will take delivery in the form of a beneficial interest in the Rule 144A Global Note,
then the transferor must deliver a certificate in the form of Exhibit B, including the certifications in item (1) thereof; 

(B) if the transferee will take delivery in the form of a beneficial interest in the Regulation S Temporary Global Note or the
Regulation S Permanent Global Note, then the transferor must deliver a certificate in the form of Exhibit B, including the certifications in item (2) thereof; and 

(C) if the transferee will take delivery in the form of a beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable. 

(4) Transfer and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may be exchanged by any Holder thereof for a beneficial interest in an Unrestricted Global Note or transferred to a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note if the exchange or transfer complies with the requirements of Section 2.3(c)(2) and the Registrar receives the following: 

(i) if the Holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a
beneficial interest in an Unrestricted Global Note, a certificate from such Holder in the form of Exhibit C, including the certifications in item (1)(a) thereof; or 

(ii) if the Holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a
Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note, a certificate from such Holder in the form of Exhibit B, including the certifications in item (4) thereof; 

 and, in each such case, if the Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the Registrar and the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain compliance with the Securities Act. 
 If any such transfer is effected at a
time when an Unrestricted Global Note has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.04 of the Indenture, the Trustee shall authenticate one or
more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred. 

Beneficial interests in an Unrestricted Global Note cannot be exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note. 
 (d) Transfer or Exchange of Beneficial Interests for Definitive Notes. 

(1) Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes. If any Holder of a beneficial
interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation: 
 (A) if the Holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note, a certificate from such Holder in the form of Exhibit C, including the certifications in item (2)(a) thereof; 

(B) if such beneficial interest is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set
forth in Exhibit B, including the certifications in item (1) thereof; 
 (C) if such beneficial interest is being
transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B, including the certifications in item
(2) thereof; 
 (D) if such beneficial interest is being transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144, a certificate to the effect set forth in Exhibit B, including the certifications in item (3)(a) thereof; 

(E) if such beneficial interest is being transferred to an Institutional Accredited Investor in reliance on an exemption from
the registration requirements of the Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications, certificates and Opinion of Counsel
required by item (3)(d) thereof, if applicable; 

 (F) if such beneficial interest is being transferred to the Company or any of its
Subsidiaries, a certificate to the effect set forth in Exhibit B, including the certifications in item (3)(b) thereof; or 

(G) if such beneficial interest is being transferred pursuant to an effective registration statement under the Securities Act,
a certificate to the effect set forth in Exhibit B, including the certifications in item (3)(c) thereof, 
 the Trustee shall cause the aggregate
principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.3(i), and the Company shall execute and the Trustee shall authenticate and deliver to the Person designated in the instructions a Definitive Note
in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.3(d) shall be registered in such name or names and in such authorized denomination or
denominations as the Holder of such beneficial interest shall instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall deliver such Definitive Notes to the Persons in whose names
such Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.3(d)(1) shall bear the Private Placement Legend and shall be subject to all restrictions on
transfer contained therein. 
 (2) Beneficial Interests in Regulation S Temporary Global Note to Definitive Notes.
Notwithstanding Sections 2.3(d)(1)(A) and (C), a beneficial interest in the Regulation S Temporary Global Note may not be exchanged for a Definitive Note or transferred to a Person who takes delivery thereof in the form of a Definitive
Note prior to (A) the expiration of the Restricted Period and (B) the receipt by the Registrar of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act, except in the case of a transfer pursuant to an
exemption from the registration requirements of the Securities Act other than Rule 903 or Rule 904. 
 (3) Beneficial
Interests in Restricted Global Notes to Unrestricted Definitive Notes. A Holder of a beneficial interest in a Restricted Global Note may exchange such beneficial interest for an Unrestricted Definitive Note or may transfer such beneficial
interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note only if the Registrar receives the following: 

(i) if the Holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for an
Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit C, including the certifications in item (1)(b) thereof; or 

(ii) if the Holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a
Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit B, including the certifications in item (4) thereof; 

 and, in each such case, if the Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the Registrar and the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain compliance with the Securities Act. 
 (4) Beneficial
Interests in Unrestricted Global Notes to Unrestricted Definitive Notes. If any Holder of a beneficial interest in an Unrestricted Global Note proposes to exchange such beneficial interest for an Unrestricted Definitive Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note, then, upon satisfaction of the conditions set forth in Section 2.3(c)(2), the Trustee will cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section 2.3(i), and the Company will execute and the Trustee will authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.3(d)(4) will be registered in such name or names and in such authorized denomination or denominations as the Holder of such
beneficial interest requests through instructions to the Registrar from or through the Depositary and the Participant or Indirect Participant. The Trustee will deliver such Definitive Notes to the Persons in whose names such Notes are so registered.
Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.3(d)(4) will not bear the Private Placement Legend. 

(e) Transfer and Exchange of Definitive Notes for Beneficial Interests. 

Unless initially exchanged in accordance with Section 2.3(a), Definitive Notes may be transferred and exchanged for beneficial
interests in Global Notes as follows: 
 (1) Restricted Definitive Notes to Beneficial Interests in Restricted Global
Notes. If any Holder of a Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note or to transfer such Restricted Definitive Notes to a Person who takes delivery thereof in the form of a
beneficial interest in a Restricted Global Note, then, upon receipt by the Registrar of the following documentation: 
 (A)
if the Holder of such Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note, a certificate from such Holder in the form of Exhibit C, including the certifications in item (2)(b)
thereof; 
 (B) if such Restricted Definitive Note is being transferred to a QIB in accordance with Rule 144A, a certificate
to the effect set forth in Exhibit B, including the certifications in item (1) thereof; 
 (C) if such Restricted
Definitive Note is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B, including the
certifications in item (2) thereof; 

 (D) if such Restricted Definitive Note is being transferred pursuant to an
exemption from the registration requirements of the Securities Act in accordance with Rule 144, a certificate to the effect set forth in Exhibit B , including the certifications in item (3)(a) thereof; 

(E) if such Restricted Definitive Note is being transferred to an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications, certificates and Opinion of
Counsel required by item (3)(d) thereof, if applicable; 
 (F) if such Restricted Definitive Note is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof; or 

(G) if such Restricted Definitive Note is being transferred pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit B, including the certifications in item (3)(c) thereof, 
 the
Trustee will cancel the Restricted Definitive Note, increase or cause to be increased the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Note, in the case of clause (B) above, the Rule
144A Global Note, in the case of clause (C) above, the Regulation S Global Note, in the case of clause (E) above, the IAI Global Note and in all other cases, the appropriate Unrestricted Global Note. 

(2) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of a Restricted
Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Restricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note
only if the Registrar receives the following: 
 (i) if the Holder of such Definitive Notes proposes to exchange such Notes
for a beneficial interest in the Unrestricted Global Note, a certificate from such Holder in the form of Exhibit C, including the certifications in item (1)(c) thereof; or 

(ii) if the Holder of such Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the
form of a beneficial interest in the Unrestricted Global Note, a certificate from such Holder in the form of Exhibit B, including the certifications in item (4) thereof; 

 and, in each such case, if the Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the Registrar and the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain compliance with the Securities Act. 
 Upon satisfaction of the
conditions of any of the subparagraphs in this Section 2.3(e)(2), the Trustee will cancel the Definitive Notes and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Note. 

(3) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of an Unrestricted
Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Definitive Notes to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note at any time.
Upon receipt of a request for such an exchange or transfer, the Trustee will cancel the applicable Unrestricted Definitive Note and increase or cause to be increased the aggregate principal amount of one of the Unrestricted Global Notes. 

If any such exchange or transfer from a Definitive Note to a beneficial interest is effected pursuant to subparagraphs (2)(B),
(2)(D) or (3) above at a time when an Unrestricted Global Note has not yet been issued, the Company will issue and, upon receipt of an Authentication Order in accordance with Section 2.04 of the Indenture, the Trustee
will authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of Definitive Notes so transferred. 

(f) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon request by a Holder of Definitive Notes and such Holder’s
compliance with the provisions of this Section 2.3(f), the Registrar will register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting Holder must present or surrender to the
Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such Holder or by its attorney, duly authorized in writing. In addition, the requesting Holder
must provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.3(f). 

(1) Restricted Definitive Notes to Restricted Definitive Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Note if the Registrar receives the following: 

(A) if the transfer will be made pursuant to Rule 144A, then the transferor must deliver a certificate in the form of
Exhibit B, including the certifications in item (1) thereof; 

 (B) if the transfer will be made pursuant to Rule 903 or Rule 904, then the
transferor must deliver a certificate in the form of Exhibit B, including the certifications in item (2) thereof; and 

(C) if the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, then
the transferor must deliver a certificate in the form of Exhibit B, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable. 

(2) Restricted Definitive Notes to Unrestricted Definitive Notes. Any Restricted Definitive Note may be exchanged by the
Holder thereof for an Unrestricted Definitive Note or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Note if the Registrar receives the following: 

(i) if the Holder of such Restricted Definitive Notes proposes to exchange such Notes for an Unrestricted Definitive Note, a
certificate from such Holder in the form of Exhibit C, including the certifications in item (1)(d) thereof; or 
 (ii)
if the Holder of such Restricted Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit B, including
the certifications in item (4) thereof; 
 and, in each such case, if the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act. 
 (3) Unrestricted Definitive Notes to Unrestricted Definitive Notes.
A Holder of Unrestricted Definitive Notes may transfer such Notes to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a request to register such a transfer, the Registrar shall register the
Unrestricted Definitive Notes pursuant to the instructions from the Holder thereof. 
 (g) Legends. The following legends will appear
on the face of all Global Notes and Definitive Notes issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Indenture or any Supplemental Indenture governing Additional Notes. 

(1) Private Placement Legend. 

(A) Except as permitted by subparagraph (B) below, each Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend in substantially the following form: 
 “THIS SECURITY HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY 

 
STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS
PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT,
(C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL ‘‘ACCREDITED INVESTOR’’ WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE
NOTES FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ‘‘ACCREDITED INVESTOR’’, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES
(D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE.” 
 (B) Notwithstanding the foregoing, any Global Note or Definitive Note issued pursuant to subparagraphs (b)(4),
(c)(3), (c)(4), (d)(2), (d)(3), (e)(2), (e)(3) or (f) of this Section 2.3 (and all Notes issued in exchange therefor or substitution thereof) will not bear the Private Placement Legend. 

(2) Global Note Legend. Each Global Note will bear a legend in substantially the following form: 

“THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE

 
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT
TO SECTION 2.3 OF APPENDIX A TO THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.3 OF APPENDIX A TO THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION
PURSUANT TO SECTION 2.12 OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. 

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.” 

(3) Regulation S Temporary Global Note Legend. The Regulation S Temporary Global Note will bear a Legend in
substantially the following form: 
 “THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS
EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.” 

(h) Cancellation and/or Adjustment of Global Notes. At such time as all beneficial interests in a particular Global Note have been
exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note will be returned to or retained and canceled by the Trustee in accordance with
Section 2.12 of the Indenture. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial
interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note will be reduced accordingly and an endorsement will 

 
be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to
a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note will be increased accordingly and an endorsement will be made on such Global Note by the Trustee or by the Depositary at the
direction of the Trustee to reflect such increase. 
 (i) General Provisions Relating to Transfers and Exchanges. 

(1) To permit registrations of transfers and exchanges, the Company will execute and the Trustee will authenticate Global Notes
and Definitive Notes upon receipt of an Authentication Order in accordance with Section 2.02 of the Indenture or at the Registrar’s request. 

(2) No service charge will be made to a Holder of a beneficial interest in a Global Note or to a Holder of a Definitive Note
for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to Sections 2.09, 3.06, 3.09, 4.09, 4.13, 4.14, 4.19 and 9.05 of the Indenture). 

(3) The Registrar will not be required to register the transfer of or exchange of any Note selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in part. 
 (4) All Global Notes and Definitive Notes
issued upon any registration of transfer or exchange of Global Notes or Definitive Notes will be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Global Notes or
Definitive Notes surrendered upon such registration of transfer or exchange. 
 (5) Neither the Registrar nor the Company
will be required: 
 (A) to issue, to register the transfer of or to exchange any Notes during a period beginning at the
opening of business 15 days before the day of any selection of Notes for redemption under Section 3.02 of the Indenture and ending at the close of business on the day of selection; 

(B) to register the transfer of or to exchange any Note selected for redemption in whole or in part, except the unredeemed
portion of any Note being redeemed in part; or 
 (C) to register the transfer of or to exchange a Note between a record date
and the next succeeding Payment Date. 
 (6) Prior to due presentment for the registration of a transfer of any Note, the
Trustee, any Agent and the Company may deem and treat the Person in whose name any 

 
Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Notes and for all other purposes, and none of the Trustee, any
Agent or the Company shall be affected by notice to the contrary. 
 (7) The Trustee will authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.04 of the Indenture. 
 (8) All
certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.3 to effect a registration of transfer or exchange may be submitted by facsimile. 

(9) None of the Trustee, the Paying Agent or the Registrar shall have any responsibility or obligation to any beneficial owner
in a Global Note, an agent member of the Depositary or other Person with respect to the accuracy of the records of the Depositary or its nominee or of any agent member of the Depositary, with respect to any ownership interest in the Notes or with
respect to the delivery to any agent member of the Depositary, Beneficial Owner or other Person (other than the Depositary) of any notice (including any notice of redemption) or the payment of any amount, under or with respect to such Notes. All
notices and communications to be given to the Holders and all payments to be made to Holders under the Notes and this Indenture shall be given or made only to or upon the order of the registered holders (which shall be the Depositary or its nominee
in the case of the Global Note). The rights of Beneficial Owners in the Global Note shall be exercised only through the Depositary subject to the Applicable Procedures. The Trustee, the Paying Agent and the Registrar shall be entitled to rely and
shall be fully protected in relying upon information furnished by the Depositary with respect to its members, participants and any beneficial owners. The Trustee, the Paying Agent and the Registrar shall be entitled to deal with the Depositary, and
any nominee thereof, that is the registered holder of any Global Note for all purposes of this Indenture relating to such Global Note (including the payment of principal, premium, if any, and interest, if any, and the giving of instructions or
directions by or to the owner or holder of a beneficial ownership interest in such Global Note) as the sole holder of such Global Note and shall have no obligations to the Beneficial Owners thereof. None of the Trustee, the Paying Agent or the
Registrar shall have any responsibility or liability for any acts or omissions of the Depositary with respect to such Global Note, for the records of any such depositary, including records in respect of beneficial ownership interests in respect of
any such Global Note, for any transactions between the Depositary and any agent member of the Depositary or between or among the Depositary, any such agent member of the Depositary and/or any holder or owner of a beneficial interest in such Global
Note, or for any transfers of beneficial interests in any such Global Note. 
 (10) Notwithstanding the foregoing, with
respect to any Global Note, nothing herein shall prevent the Company, the Trustee, or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by any Depositary (or its nominee),
as a Holder, with respect to such Global Note or shall impair, as between such Depositary and owners of beneficial interests in such Global Note, the operation of customary practices governing the exercise of the rights of such Depositary (or its
nominee) as Holder of such Global Note. 

 (11) None of the Trustee, the Paying Agent or the Registrar shall have any
obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under Applicable Law with respect to any transfer of any interest in any security (including any transfers between
or among Depositary participants, members or beneficial owners in any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by,
the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof. 

 APPENDIX B 

PAYMENT SCHEDULE 
  

																	
	 Date
	  	Principal
Payment	 	  	Interest Payment	 	  	Total Payment	 	  	Outstanding
Principal	 
	 2/24/2017
	  	 	—  	 	  	 	—  	 	  	 	—  	 	  	$	800,000,000.00	 
	 3/15/2017
	  	 	—  	 	  	 	—  	 	  	 	—  	 	  	$	800,000,000.00	 
	 9/15/2017
	  	 	—  	 	  	$	22,333,333.33	 	  	$	22,333,333.33	 	  	$	800,000,000.00	 
	 3/15/2018
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2018
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2019
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2019
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2020
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2020
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2021
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2021
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2022
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2022
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2023
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2023
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2024
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2024
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2025
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 

																	
	 9/15/2025
	  	$	23,420,737.00	 	  	$	20,000,000.00	 	  	$	43,420,737.00	 	  	$	776,579,263.00	 
	 3/15/2026
	  	$	24,006,255.00	 	  	$	19,414,481.58	 	  	$	43,420,736.58	 	  	$	752,573,008.00	 
	 9/15/2026
	  	$	24,606,412.00	 	  	$	18,814,325.20	 	  	$	43,420,737.20	 	  	$	727,966,596.00	 
	 3/15/2027
	  	$	25,221,572.00	 	  	$	18,199,164.90	 	  	$	43,420,736.90	 	  	$	702,745,024.00	 
	 9/15/2027
	  	$	25,852,111.00	 	  	$	17,568,625.60	 	  	$	43,420,736.60	 	  	$	676,892,913.00	 
	 3/15/2028
	  	$	26,498,414.00	 	  	$	16,922,322.83	 	  	$	43,420,736.83	 	  	$	650,394,499.00	 
	 9/15/2028
	  	$	27,160,874.00	 	  	$	16,259,862.48	 	  	$	43,420,736.48	 	  	$	623,233,625.00	 
	 3/15/2029
	  	$	27,839,896.00	 	  	$	15,580,840.63	 	  	$	43,420,736.63	 	  	$	595,393,729.00	 
	 9/15/2029
	  	$	28,535,894.00	 	  	$	14,884,843.23	 	  	$	43,420,737.23	 	  	$	566,857,835.00	 
	 3/15/2030
	  	$	29,249,291.00	 	  	$	14,171,445.88	 	  	$	43,420,736.88	 	  	$	537,608,544.00	 
	 9/15/2030
	  	$	29,980,523.00	 	  	$	13,440,213.60	 	  	$	43,420,736.60	 	  	$	507,628,021.00	 
	 3/15/2031
	  	$	30,730,036.00	 	  	$	12,690,700.53	 	  	$	43,420,736.53	 	  	$	476,897,985.00	 
	 9/15/2031
	  	$	31,498,287.00	 	  	$	11,922,449.63	 	  	$	43,420,736.63	 	  	$	445,399,698.00	 
	 3/15/2032
	  	$	32,285,744.00	 	  	$	11,134,992.45	 	  	$	43,420,736.45	 	  	$	413,113,954.00	 
	 9/15/2032
	  	$	33,092,888.00	 	  	$	10,327,848.85	 	  	$	43,420,736.85	 	  	$	380,021,066.00	 
	 3/15/2033
	  	$	33,920,210.00	 	  	$	9,500,526.65	 	  	$	43,420,736.65	 	  	$	346,100,856.00	 
	 9/15/2033
	  	$	34,768,215.00	 	  	$	8,652,521.40	 	  	$	43,420,736.40	 	  	$	311,332,641.00	 
	 3/15/2034
	  	$	35,637,421.00	 	  	$	7,783,316.03	 	  	$	43,420,737.03	 	  	$	275,695,220.00	 
	 9/15/2034
	  	$	36,528,356.00	 	  	$	6,892,380.50	 	  	$	43,420,736.50	 	  	$	239,166,864.00	 
	 3/15/2035
	  	$	37,441,565.00	 	  	$	5,979,171.60	 	  	$	43,420,736.60	 	  	$	201,725,299.00	 
	 9/15/2035
	  	$	38,377,604.00	 	  	$	5,043,132.48	 	  	$	43,420,736.48	 	  	$	163,347,695.00	 
	 3/15/2036
	  	$	39,337,045.00	 	  	$	4,083,692.38	 	  	$	43,420,737.38	 	  	$	124,010,650.00	 
	 9/15/2036
	  	$	40,320,471.00	 	  	$	3,100,266.25	 	  	$	43,420,737.25	 	  	$	83,690,179.00	 
	 3/15/2037
	  	$	41,328,482.00	 	  	$	2,092,254.48	 	  	$	43,420,736.48	 	  	$	42,361,697.00	 
	 9/15/2037
	  	$	42,361,697.00	 	  	$	1,059,042.43	 	  	$	43,420,739.43	 	  	 	—  	 

 EXHIBIT A-1 

[Face of Note] 
 CUSIP: 785592 A*7

 5.00% Senior Secured Notes due 2037 
  

			
	No.                    	  	$            

 SABINE PASS LIQUEFACTION, LLC 

promises to pay to                      or registered
assigns, the principal sum of          DOLLARS and interest thereon in the pro rata amounts and on the Payment Dates provided for under Schedule I hereto. 

Payment Dates: March 15 and September 15, commencing September 15, 2017 

Record Dates: March 1 and September 1 
 Dated:
            , 2017 
  

			
	SABINE PASS LIQUEFACTION, LLC
		
	By:	 	  

	Name:	 	
	Title:	 	

  

			
	 This is one of the Notes referred to

in the within-mentioned Indenture:

	
	 THE BANK OF NEW YORK MELLON,

    as Trustee

		
	By:	 	  

		 	Authorized Signatory

 [Back of Note] 

5.00% Senior Secured Notes due 2037 
 [Insert
the Global Note Legend, if applicable pursuant to the provisions of the Indenture] 
 [Insert the Private Placement Legend, if applicable pursuant to
the provisions of the Indenture] 
 Capitalized terms used herein have the meanings assigned to them in the Indenture referred to below
unless otherwise indicated. 
 (1) PRINCIPAL AND INTEREST.
Sabine Pass Liquefaction, LLC, a Delaware limited liability company (the “Company”), promises to make payments of principal and interest in the pro rata amounts and on the Payment Dates provided for under Schedule I hereto. Interest
on the Notes will accrue from the most recent Payment Date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this Note
is authenticated between a record date referred to on the face hereof and the next succeeding Payment Date, interest shall accrue from such next succeeding Payment Date; provided further that the first Payment Date shall be September 15,
2017. The Company will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and interest thereon, if any, from time to time on demand at a rate that is 0.5% per annum in excess of the rate
then in effect to the extent lawful (without regard to any applicable grace periods). Interest will be computed on the basis of a 360-day year of twelve 30-day months.

 (2) METHOD OF PAYMENT. The Company will make payments
(except defaulted interest) to the Persons who are registered Holders of Notes at the close of business on the March 1 or September 1 next preceding the Payment Date, even if such Notes are canceled after such record date and on or before
such Payment Date, except as provided in Section 2.13 of the Indenture with respect to defaulted interest. The Notes will be payable as to principal, premium, if any, and interest at the office or agency of the Paying Agent or Registrar
maintained for such purpose within or without the City and State of New York, or, at the option of the Company, payment of interest, if any, may be made by check mailed to the Holders at their addresses set forth in the register of Holders;
provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest, premium, if any, on, all Global Notes and all other Notes the Holders of which will have provided wire transfer
instructions to the Company or the Paying Agent. Such payment will be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 

(3) PAYING AGENT AND REGISTRAR. Initially,
The Bank of New York Mellon, the Trustee under the Indenture, will act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its Subsidiaries may act in any such
capacity. 

 (4) INDENTURE AND SECURITY
DOCUMENTS. The Company issued the Notes under an Indenture dated as of February 24, 2017 (the “Indenture”) among the Company, the Guarantors and the Trustee. The terms of the Notes include
those stated in the Indenture. The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are secured obligations of the Company. The Notes are secured by a pledge of Collateral (as defined in the Indenture) pursuant to the Security Documents referred
to in the Indenture. The Indenture does not limit the aggregate principal amount of Notes that may be issued thereunder. 

(5) OPTIONAL REDEMPTION. 

At any time or from time to time prior to March 15, 2037, the Company may, at its option, redeem all or a part of the
Initial Notes or a particular series of Additional Notes at a redemption price equal to the Optional Redemption Price (subject to the right of Holders of record on the relevant record date to receive interest due on a payment date that is on or
prior to the redemption date, without duplication). 
 “Optional Redemption Price” with respect to any Notes
to be redeemed, means an amount equal to the greater of: 
  

	 	(1)	100% of the principal amount of such Notes; and 

  

	 	(2)	the Discounted Value of such Notes; 

 plus, in the case of both (1) and (2), accrued and
unpaid interest on such Notes, if any, to the redemption date. 
 “Called Principal” means, with respect to
any Note, the principal of such Note that is to be prepaid or has become or is declared to be immediately due and payable, 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. 

“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. 

 “Reinvestment Yield” means, with respect to the Called Principal
of any Note, the sum of (x) 0.50% and (y) the yield to maturity implied by the yield(s) reported as of 10:00 a.m. (New York City time) on the second (2nd) 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 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, the sum of (x) 0.50% and (y) 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 (2nd) 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” shall mean, with respect to any Called Principal, the number of years obtained by
dividing (a) such Called Principal into (b) the sum of the products obtained by multiplying (1) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (2) the number of years,
computed on the basis of a 360-day year composed of twelve 30-day months 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. 

 “Settlement Date” means, with respect to the Called Principal of
a Note, the date on which such Called Principal is to be redeemed or has become or is declared to be immediately due and payable. 

The notice of redemption with respect to the foregoing redemption need not set forth the Optional Redemption Price but only the
manner of calculation thereof. The Company will notify the Trustee of the Optional Redemption Price with respect to any redemption promptly after the calculation, and the Trustee shall not be responsible for such calculation. 

(6) MANDATORY REDEMPTION. 

The Company is not required to make mandatory redemption or sinking fund payments with respect to the Notes. 

(7) REPURCHASE AT THE OPTION OF
HOLDER. 
 (a)    Upon the occurrence of a Change of Control, the
Company will make an offer (a “Change of Control Offer”) of payment (a “Change of Control Payment”) to each Holder to repurchase all or any part (equal to $100,000 and integral multiples of $1,000 in excess thereof)
of that Holder’s Notes at a purchase price in cash equal to not less than 101% of the aggregate principal amount of Notes repurchased plus accrued and unpaid interest, if any, to the date of repurchase (the “Change of Control Payment
Date,” which date will be no earlier than the date of such Change of Control). No later than 30 days following any Change of Control, the Company will mail a notice to each Holder describing the transaction or transactions that constitute
the Change of Control and setting forth the procedures governing the Change of Control Offer as required by the Indenture. 

(b)    The Company will be required to make Asset Sale Offers, Excess Proceeds Offers and Project Document
Termination Payment Offers to the extent provided in Sections 4.09, 4.14 and 4.19, respectively, of the Indenture. 
 (8)
NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its
registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction or discharge of the Indenture. Notes in
denominations larger than $100,000 may be redeemed in part but only in whole multiples of $1,000 in excess thereof, unless all of the Notes held by a Holder are to be redeemed. 

(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $100,000 and integral multiples of $1,000 in excess thereof. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register
the transfer of any Note or portion of a Note 

 
selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record date and the corresponding Payment Date. 

(10) PERSONS DEEMED OWNERS. The registered Holder of a Note
may be treated as its owner for all purposes. 
 (11) TRUSTEE DEALINGS WITH
COMPANY. The Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates, as if it were not the Trustee. 
 (12) NO RECOURSE AGAINST
OTHERS. No past, present or future director, manager, officer, employee, incorporator, member, partner or stockholder of the Company or any Guarantor (including the General Partner and the Parent), as such, will
have any liability for any obligations of the Company or the Guarantors under the Notes, the Indenture, the Note Guarantees, the Security Documents, the Financing Documents or for any claim based on, in respect of, or by reason of, such obligations
or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. 

(13) AUTHENTICATION. This Note will not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent. 
 (14) ABBREVIATIONS. Customary
abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian),
and U/G/M/A (= Uniform Gifts to Minors Act). 
 (15) CUSIP NUMBERS. Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes, and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders.
No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed thereon. 

(16) GOVERNING LAW. THE LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE
USED TO CONSTRUE THE INDENTURE, THIS NOTE AND THE NOTE GUARANTEES. 
 The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to: 
 Sabine Pass Liquefaction, LLC 

c/o Cheniere Energy, Inc. 
 700 Milam Street, Suite 1900 

Houston, TX 77002 
 Attention: Treasurer 

 Schedule I 

PAYMENT SCHEDULE 
  

																	
	 Date
	  	Principal Payment	 	  	Interest Payment	 	  	Total Payment	 	  	Outstanding Principal	 
	 2/24/2017
	  	 	—  	 	  	 	—  	 	  	 	—  	 	  	$	800,000,000.00	 
	 3/15/2017
	  	 	—  	 	  	 	—  	 	  	 	—  	 	  	$	800,000,000.00	 
	 9/15/2017
	  	 	—  	 	  	$	22,333,333.33	 	  	$	22,333,333.33	 	  	$	800,000,000.00	 
	 3/15/2018
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2018
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2019
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2019
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2020
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2020
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2021
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2021
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2022
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2022
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2023
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2023
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2024
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2024
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2025
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2025
	  	$	23,420,737.00	 	  	$	20,000,000.00	 	  	$	43,420,737.00	 	  	$	776,579,263.00	 
	 3/15/2026
	  	$	24,006,255.00	 	  	$	19,414,481.58	 	  	$	43,420,736.58	 	  	$	752,573,008.00	 
	 9/15/2026
	  	$	24,606,412.00	 	  	$	18,814,325.20	 	  	$	43,420,737.20	 	  	$	727,966,596.00	 

																	
	 	  	 	 	  	 	 	  	 	 	  	 	 
	 3/15/2027
	  	$	25,221,572.00	 	  	$	18,199,164.90	 	  	$	43,420,736.90	 	  	$	702,745,024.00	 
	 9/15/2027
	  	$	25,852,111.00	 	  	$	17,568,625.60	 	  	$	43,420,736.60	 	  	$	676,892,913.00	 
	 3/15/2028
	  	$	26,498,414.00	 	  	$	16,922,322.83	 	  	$	43,420,736.83	 	  	$	650,394,499.00	 
	 9/15/2028
	  	$	27,160,874.00	 	  	$	16,259,862.48	 	  	$	43,420,736.48	 	  	$	623,233,625.00	 
	 3/15/2029
	  	$	27,839,896.00	 	  	$	15,580,840.63	 	  	$	43,420,736.63	 	  	$	595,393,729.00	 
	 9/15/2029
	  	$	28,535,894.00	 	  	$	14,884,843.23	 	  	$	43,420,737.23	 	  	$	566,857,835.00	 
	 3/15/2030
	  	$	29,249,291.00	 	  	$	14,171,445.88	 	  	$	43,420,736.88	 	  	$	537,608,544.00	 
	 9/15/2030
	  	$	29,980,523.00	 	  	$	13,440,213.60	 	  	$	43,420,736.60	 	  	$	507,628,021.00	 
	 3/15/2031
	  	$	30,730,036.00	 	  	$	12,690,700.53	 	  	$	43,420,736.53	 	  	$	476,897,985.00	 
	 9/15/2031
	  	$	31,498,287.00	 	  	$	11,922,449.63	 	  	$	43,420,736.63	 	  	$	445,399,698.00	 
	 3/15/2032
	  	$	32,285,744.00	 	  	$	11,134,992.45	 	  	$	43,420,736.45	 	  	$	413,113,954.00	 
	 9/15/2032
	  	$	33,092,888.00	 	  	$	10,327,848.85	 	  	$	43,420,736.85	 	  	$	380,021,066.00	 
	 3/15/2033
	  	$	33,920,210.00	 	  	$	9,500,526.65	 	  	$	43,420,736.65	 	  	$	346,100,856.00	 
	 9/15/2033
	  	$	34,768,215.00	 	  	$	8,652,521.40	 	  	$	43,420,736.40	 	  	$	311,332,641.00	 
	 3/15/2034
	  	$	35,637,421.00	 	  	$	7,783,316.03	 	  	$	43,420,737.03	 	  	$	275,695,220.00	 
	 9/15/2034
	  	$	36,528,356.00	 	  	$	6,892,380.50	 	  	$	43,420,736.50	 	  	$	239,166,864.00	 
	 3/15/2035
	  	$	37,441,565.00	 	  	$	5,979,171.60	 	  	$	43,420,736.60	 	  	$	201,725,299.00	 
	 9/15/2035
	  	$	38,377,604.00	 	  	$	5,043,132.48	 	  	$	43,420,736.48	 	  	$	163,347,695.00	 
	 3/15/2036
	  	$	39,337,045.00	 	  	$	4,083,692.38	 	  	$	43,420,737.38	 	  	$	124,010,650.00	 
	 9/15/2036
	  	$	40,320,471.00	 	  	$	3,100,266.25	 	  	$	43,420,737.25	 	  	$	83,690,179.00	 
	 3/15/2037
	  	$	41,328,482.00	 	  	$	2,092,254.48	 	  	$	43,420,736.48	 	  	$	42,361,697.00	 
	 9/15/2037
	  	$	42,361,697.00	 	  	$	1,059,042.43	 	  	$	43,420,739.43	 	  	 	—  	 

 ASSIGNMENT FORM 

To assign this Note, fill in the form below: 
  

			
	(I) or (we) assign and transfer this Note to:	 	  

		 	(Insert assignee’s legal name)

  

	
	  

	(Insert assignee’s soc. sec. or tax I.D. no.)
	
	  

	
	  

	
	  

	
	  

	(Print or type assignee’s name, address and zip code)

and irrevocably                      
                                         
                                         
                                         
                                         
     
 appoint to transfer this Note on the books of the Company. The agent may substitute another to act for him. 

Date:                      

 

			
	Your Signature:	 	  

	 (Sign exactly as your name appears on the face of this Note)

 Signature Guarantee*:
                                         
        
  
  

	*	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 

 OPTION OF HOLDER TO
ELECT PURCHASE 
 If you want to elect to have this Note purchased by the Company pursuant to
Section 4.09, 4.13, 4.14 or 4.19 of the Indenture, check the appropriate box below: 

☐  Section 4.09                 
   ☐  Section 4.13                    ☐  Section 4.14      
              ☐  Section 4.19 
 If you want to
elect to have only part of the Note purchased by the Company pursuant to Section 4.09 4.13, 4.14 or 4.19 of the Indenture, state the amount you elect to have purchased: 

$         

Date:                      

 

			
	Your Signature:	 	  

	 (Sign exactly as your name appears on the face of this
Note)

  

			
	Tax Identification No:	 	  

 Signature Guarantee*:
                                        

  
  

	*	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 

 SCHEDULE OF EXCHANGES OF
INTERESTS IN THE GLOBAL NOTE 
 The following exchanges of a part
of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made: 

 

									
	 Date of

Exchange
	 	 Amount of

decrease in

Principal
 Amount
[at
 maturity] of this

Global Note
	 	 Amount of

increase in

Principal
 Amount
[at
 maturity] of this

Global Note
	  	 Principal

Amount [at
 maturity]
of
 this Global
 Note
following
 such decrease

(or increase)
	  	 Signature of

authorized
 officer
of
 Trustee or

Custodian

 EXHIBIT A-2 

[Face of Regulation S Temporary Global Note] 

CUSIP: 785592 A*7 
 5.00% Senior
Secured Notes due 2037 
  

			
	No.                     	  	$            

 SABINE PASS LIQUEFACTION, LLC 

promises to pay to                      or registered
assigns, the principal sum of          DOLLARS and interest thereon in the pro rata amounts and on the Payment Dates provided for under Schedule I hereto. 

Payment Dates: March 15 and September 15, commencing September 15, 2017 

Record Dates: March 1 and September 1 
 Dated:
            , 2017 
  

			
	SABINE PASS LIQUEFACTION, LLC
		
	By:	 	  

	Name:	 	
	Title:	 	

  

			
	This is one of the Notes referred to in the within-mentioned Indenture:
	
	 THE BANK OF NEW YORK MELLON,

    as Trustee

		
	 By:
	 	  

		 	Authorized Signatory

 [Back of Regulation S Temporary Global Note] 

5.00% Senior Secured Notes due 2037 
 THE RIGHTS
ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS
REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON. 
 THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO SECTION 2.3 OF APPENDIX A TO THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.3(a) OF APPENDIX A TO THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE
FOR CANCELLATION PURSUANT TO SECTION 2.12 OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. 

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, 

 
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS
SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION
DATE”) THAT IS ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE ISSUER,
(B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY
BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL ‘‘ACCREDITED INVESTOR’’ WITHIN THE
MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE NOTES FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ‘‘ACCREDITED INVESTOR’’, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM.
THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. 
 Capitalized terms used herein
have the meanings assigned to them in the Indenture referred to below unless otherwise indicated. 
 (1)
PRINCIPAL AND INTEREST. Sabine Pass Liquefaction, LLC, a Delaware limited liability company (the “Company”), promises to make payments of principal and interest in
the pro rata amounts and on the Payment Dates provided for under Schedule I hereto. Interest on the Notes will accrue from the most recent Payment Date to which interest has been paid or, if no interest has been paid, from the date of issuance;
provided that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Payment Date, interest shall accrue from such next
succeeding Payment Date; provided further that the first Payment Date shall be September 15, 2017. The Company will pay interest (including 

 
post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and interest thereon, if any, from time to time on demand at a rate that is 0.5% per annum in excess of the
rate then in effect to the extent lawful (without regard to any applicable grace periods). Interest will be computed on the basis of a 360-day year of twelve 30-day
months. 
 Until this Regulation S Temporary Global Note is exchanged for one or more Regulation S Permanent Global Notes,
the Holder hereof shall not be entitled to receive payments of interest hereon; until so exchanged in full, this Regulation S Temporary Global Note shall in all other respects be entitled to the same benefits as other Notes under the Indenture. 

(2) METHOD OF PAYMENT. The Company will make payments
(except defaulted interest) to the Persons who are registered Holders of Notes at the close of business on the March 1 and September 1 next preceding the Payment Date, even if such Notes are canceled after such record date and on or before
such Payment Date, except as provided in Section 2.13 of the Indenture with respect to defaulted interest. The Notes will be payable as to principal, premium, if any, and interest at the office or agency of the Paying Agent or Registrar
maintained for such purpose within or without the City and State of New York, or, at the option of the Company, payment of interest, if any, may be made by check mailed to the Holders at their addresses set forth in the register of Holders;
provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest, premium, if any, on, all Global Notes and all other Notes the Holders of which will have provided wire transfer
instructions to the Company or the Paying Agent. Such payment will be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 

(3) PAYING AGENT AND REGISTRAR. Initially,
The Bank of New York Mellon, the Trustee under the Indenture, will act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its Subsidiaries may act in any such
capacity. 
 (4) INDENTURE AND SECURITY
DOCUMENTS. The Company issued the Notes under an Indenture dated as of February 24, 2017 (the “Indenture”) among the Company, the Guarantors and the Trustee. The terms of the Notes include
those stated in the Indenture. The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are secured obligations of the Company. The Notes are secured by a pledge of Collateral (as defined in the Indenture) pursuant to the Security Documents referred
to in the Indenture. The Indenture does not limit the aggregate principal amount of Notes that may be issued thereunder. 

 (5) OPTIONAL REDEMPTION. 

At any time or from time to time prior to March 15, 2037, the Company may, at its option, redeem all or a part of the
Initial Notes or a particular series of Additional Notes at a redemption price equal to the Optional Redemption Price (subject to the right of Holders of record on the relevant record date to receive interest due on a payment date that is on or
prior to the redemption date, without duplication). 
 “Optional Redemption Price” with respect to any Notes
to be redeemed, means an amount equal to the greater of: 
 (1) 100% of the principal amount of such Notes; and 

(2) the Discounted Value of such Notes; 

plus, in the case of both (1) and (2), accrued and unpaid interest on such Notes, if any, to the redemption date. 

“Called Principal” means, with respect to any Note, the principal of such Note that is to be prepaid or has
become or is declared to be immediately due and payable, 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.

 “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. 
 “Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum of
(x) 0.50% and (y) the yield to maturity implied by the yield(s) reported as of 10:00 a.m. (New York City time) on the second (2nd) 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 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, the sum of (x) 0.50% and (y) 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 (2nd) 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” shall mean, with respect to any Called Principal, the number of years obtained by
dividing (a) such Called Principal into (b) the sum of the products obtained by multiplying (1) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (2) the number of years,
computed on the basis of a 360-day year composed of twelve 30-day months 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. 
 “Settlement Date” means, with respect to the Called Principal of a Note, the date on which such
Called Principal is to be redeemed or has become or is declared to be immediately due and payable. 
 The notice of
redemption with respect to the foregoing redemption need not set forth the Optional Redemption Price but only the manner of calculation thereof. The Company will notify the Trustee of the Optional Redemption Price with respect to any redemption
promptly after the calculation, and the Trustee shall not be responsible for such calculation. 
 (6)
MANDATORY REDEMPTION. 
 The Company is not required to make mandatory
redemption or sinking fund payments with respect to the Notes. 

 (7) REPURCHASE AT THE
OPTION OF HOLDER. 
 (a)    Upon the
occurrence of a Change of Control, the Company will make an offer (a “Change of Control Offer”) of payment (a “Change of Control Payment”) to each Holder to repurchase all or any part (equal to $100,000 and integral
multiples of $1,000 in excess thereof) of that Holder’s Notes at a purchase price in cash equal to not less than 101% of the aggregate principal amount of Notes repurchased plus accrued and unpaid interest, if any, to the date of repurchase
(the “Change of Control Payment Date,” which date will be no earlier than the date of such Change of Control). No later than 30 days following any Change of Control, the Company will mail a notice to each Holder describing the
transaction or transactions that constitute the Change of Control and setting forth the procedures governing the Change of Control Offer as required by the Indenture. 

(b)    The Company will be required to make Asset Sale Offers, Excess Proceeds Offers and Project Document
Termination Payment Offers to the extent provided in Sections 4.09, 4.14 and 4.19, respectively, of the Indenture. 
 (8)
NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its
registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction or discharge of the Indenture. Notes in
denominations larger than $100,000 may be redeemed in part but only in whole multiples of $1,000 in excess thereof, unless all of the Notes held by a Holder are to be redeemed. 

(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $100,000 and integral multiples of $1,000 in excess thereof. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register
the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date and the corresponding Payment Date. 
 This
Regulation S Temporary Global Note is exchangeable in whole or in part for one or more Global Notes only (i) on or after the termination of the 40-day distribution compliance period (as defined in
Regulation S) and (ii) upon presentation of certificates (accompanied by an Opinion of Counsel, if applicable) required by Article 2 of the Indenture. Upon exchange of this Regulation S Temporary Global Note for one or more Global Notes, the
Trustee shall cancel this Regulation S Temporary Global Note. 

 (10) PERSONS DEEMED
OWNERS. The registered Holder of a Note may be treated as its owner for all purposes. 

(11) TRUSTEE DEALINGS WITH COMPANY. The
Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee. 

(12) NO RECOURSE AGAINST OTHERS. No past,
present or future director, manager, officer, employee, incorporator, member, partner or stockholder of the Company or any Guarantor (including the General Partner and the Parent), as such, will have any liability for any obligations of the Company
or the Guarantors under the Notes, the Indenture, the Note Guarantees, the Security Documents, the Financing Documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a
Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver may not be effective to waive liabilities under federal securities laws. 

(13) AUTHENTICATION. This Note will not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent. 
 (14) ABBREVIATIONS. Customary
abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian),
and U/G/M/A (= Uniform Gifts to Minors Act). 
 (15) CUSIP NUMBERS. Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes, and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders.
No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed thereon. 

(16) GOVERNING LAW. THE LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE
USED TO CONSTRUE THE INDENTURE, THIS NOTE AND THE NOTE GUARANTEES. 
 The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to: 
 Sabine Pass Liquefaction, LLC 

c/o Cheniere Energy, Inc. 
 700 Milam Street, Suite 1900 

Houston, TX 77002 
 Attention: Treasurer 

 Schedule I 

PAYMENT SCHEDULE 
  

																	
	 Date
	  	Principal Payment	 	  	Interest Payment	 	  	Total Payment	 	  	Outstanding Principal	 
	 2/24/2017
	  	 	—  	 	  	 	—  	 	  	 	—  	 	  	$	800,000,000.00	 
	 3/15/2017
	  	 	—  	 	  	 	—  	 	  	 	—  	 	  	$	800,000,000.00	 
	 9/15/2017
	  	 	—  	 	  	$	22,333,333.33	 	  	$	22,333,333.33	 	  	$	800,000,000.00	 
	 3/15/2018
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2018
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2019
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2019
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2020
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2020
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2021
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2021
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2022
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2022
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2023
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2023
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2024
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2024
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 3/15/2025
	  	 	—  	 	  	$	20,000,000.00	 	  	$	20,000,000.00	 	  	$	800,000,000.00	 
	 9/15/2025
	  	$	23,420,737.00	 	  	$	20,000,000.00	 	  	$	43,420,737.00	 	  	$	776,579,263.00	 
	 3/15/2026
	  	$	24,006,255.00	 	  	$	19,414,481.58	 	  	$	43,420,736.58	 	  	$	752,573,008.00	 

																	
	 	  	 	 	  	 	 	  	 	 	  	 	 
	 9/15/2026
	  	$	24,606,412.00	 	  	$	18,814,325.20	 	  	$	43,420,737.20	 	  	$	727,966,596.00	 
	 3/15/2027
	  	$	25,221,572.00	 	  	$	18,199,164.90	 	  	$	43,420,736.90	 	  	$	702,745,024.00	 
	 9/15/2027
	  	$	25,852,111.00	 	  	$	17,568,625.60	 	  	$	43,420,736.60	 	  	$	676,892,913.00	 
	 3/15/2028
	  	$	26,498,414.00	 	  	$	16,922,322.83	 	  	$	43,420,736.83	 	  	$	650,394,499.00	 
	 9/15/2028
	  	$	27,160,874.00	 	  	$	16,259,862.48	 	  	$	43,420,736.48	 	  	$	623,233,625.00	 
	 3/15/2029
	  	$	27,839,896.00	 	  	$	15,580,840.63	 	  	$	43,420,736.63	 	  	$	595,393,729.00	 
	 9/15/2029
	  	$	28,535,894.00	 	  	$	14,884,843.23	 	  	$	43,420,737.23	 	  	$	566,857,835.00	 
	 3/15/2030
	  	$	29,249,291.00	 	  	$	14,171,445.88	 	  	$	43,420,736.88	 	  	$	537,608,544.00	 
	 9/15/2030
	  	$	29,980,523.00	 	  	$	13,440,213.60	 	  	$	43,420,736.60	 	  	$	507,628,021.00	 
	 3/15/2031
	  	$	30,730,036.00	 	  	$	12,690,700.53	 	  	$	43,420,736.53	 	  	$	476,897,985.00	 
	 9/15/2031
	  	$	31,498,287.00	 	  	$	11,922,449.63	 	  	$	43,420,736.63	 	  	$	445,399,698.00	 
	 3/15/2032
	  	$	32,285,744.00	 	  	$	11,134,992.45	 	  	$	43,420,736.45	 	  	$	413,113,954.00	 
	 9/15/2032
	  	$	33,092,888.00	 	  	$	10,327,848.85	 	  	$	43,420,736.85	 	  	$	380,021,066.00	 
	 3/15/2033
	  	$	33,920,210.00	 	  	$	9,500,526.65	 	  	$	43,420,736.65	 	  	$	346,100,856.00	 
	 9/15/2033
	  	$	34,768,215.00	 	  	$	8,652,521.40	 	  	$	43,420,736.40	 	  	$	311,332,641.00	 
	 3/15/2034
	  	$	35,637,421.00	 	  	$	7,783,316.03	 	  	$	43,420,737.03	 	  	$	275,695,220.00	 
	 9/15/2034
	  	$	36,528,356.00	 	  	$	6,892,380.50	 	  	$	43,420,736.50	 	  	$	239,166,864.00	 
	 3/15/2035
	  	$	37,441,565.00	 	  	$	5,979,171.60	 	  	$	43,420,736.60	 	  	$	201,725,299.00	 
	 9/15/2035
	  	$	38,377,604.00	 	  	$	5,043,132.48	 	  	$	43,420,736.48	 	  	$	163,347,695.00	 
	 3/15/2036
	  	$	39,337,045.00	 	  	$	4,083,692.38	 	  	$	43,420,737.38	 	  	$	124,010,650.00	 
	 9/15/2036
	  	$	40,320,471.00	 	  	$	3,100,266.25	 	  	$	43,420,737.25	 	  	$	83,690,179.00	 
	 3/15/2037
	  	$	41,328,482.00	 	  	$	2,092,254.48	 	  	$	43,420,736.48	 	  	$	42,361,697.00	 
	 9/15/2037
	  	$	42,361,697.00	 	  	$	1,059,042.43	 	  	$	43,420,739.43	 	  	 	—  	 

 ASSIGNMENT FORM 

To assign this Note, fill in the form below: 
  

			
	(I) or (we) assign and transfer this Note to:	 	  

		 	(Insert assignee’s legal name)

  

	
	  

	(Insert assignee’s soc. sec. or tax I.D. no.)
	
	  

	
	  

	
	  

	
	  

	(Print or type assignee’s name, address and zip code)

and irrevocably                      
                                         
                                         
                                         
                                         
     
 appoint to transfer this Note on the books of the Company. The agent may substitute another to act for him. 

Date:                      

 

			
	Your Signature:	 	  

	 (Sign exactly as your name appears on the face of this Note)

 Signature Guarantee*:
                                        

  
  

	*	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 

 OPTION OF HOLDER TO
ELECT PURCHASE 
 If you want to elect to have this Note purchased by the Company pursuant to
Section 4.09, 4.13, 4.14 or 4.19 of the Indenture, check the appropriate box below: 

☐  Section 4.09                 
   ☐  Section 4.13                    ☐  Section 4.14      
              ☐  Section 4.19 
 If you want to
elect to have only part of the Note purchased by the Company pursuant to Section 4.09, 4.13, 4.14 or 4.19 of the Indenture, state the amount you elect to have purchased: 

$        

Date:                     

 

			
	Your Signature:	 	  

	 (Sign exactly as your name appears on the face of this
Note)

  

			
	Tax Identification No:	 	  

  
 Signature Guarantee*:
                                        

  
  

	*	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 

 SCHEDULE OF EXCHANGES OF
INTERESTS IN THE REGULATIONS 
 TEMPORARY GLOBAL
NOTE 
 The following exchanges of a part of this Regulation S Temporary Global Note for an interest in another Global Note,
or exchanges of a part of another other Restricted Global Note for an interest in this Regulation S Temporary Global Note, have been made: 
  

									
	 Date of

Exchange
	 	 Amount of

decrease in

Principal
 Amount
[at
 maturity] of

this Global

Note
	 	 Amount of

increase in

Principal
 Amount
[at
 maturity] of

this Global

Note
	  	 Principal Amount

[at maturity] of this
Global Note

following such
 decrease
(or
 increase)
	  	 Signature of

authorized officer of
Trustee or Custodian

		 		 		  		  	
		 		 		  		  	
		 		 		  		  	

 EXHIBIT B 

FORM OF CERTIFICATE OF TRANSFER 
 The Bank of New
York Mellon, as Trustee 
 500 Ross Street, 12th Floor 

Pittsburgh, PA 15262 
  

	cc:	Sabine Pass Liquefaction, LLC 

 c/o Cheniere Energy, Inc. 

700 Milam Street, Suite 1900 

Houston, TX 77002 
  

	 	Re:	5.00% Senior Secured Notes due 2037 issued by Sabine Pass Liquefaction, LLC 

 Reference is
hereby made to the Indenture, dated as of February 24, 2017, (the “Indenture”), among Sabine Pass Liquefaction, LLC, as issuer (the “Company”), the Guarantors party thereto and The Bank of New York Mellon, as
trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. 

                    , (the
“Transferor”) owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $         in such Note[s] or interests (the
“Transfer”), to                      (the “Transferee”), as further specified in Annex A hereto. In connection with
the Transfer, the Transferor hereby certifies that: 
 [CHECK ALL THAT APPLY] 

 

	 	1.	☐  Check if Transferee will take delivery of a beneficial interest in the Rule 144A Global Note or a Restricted Definitive Note pursuant to Rule 144A. The Transfer is being effected
pursuant to and in accordance with Rule 144A (“Rule 144A”) under the Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, the Transferor hereby further certifies that the beneficial interest
or Definitive Note is being transferred to a Person that the Transferor reasonably believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A, and such Transfer is in compliance with any
applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on the Rule 144A Global Note and/or the Restricted Definitive Note and in the Indenture and the Securities Act. 

	 	2.	☐  Check if Transferee will take delivery of a beneficial interest in the Regulation S Temporary Global Note, the Regulation S Permanent Global Note or a Restricted Definitive Note pursuant to
Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a Person
in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the
United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a
buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme
to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Restricted Period, (x) the transfer is not being made to a U.S. Person or for the account or
benefit of a U.S. Person (other than the Initial Purchasers) and (y) the interest transferred will be held immediately thereafter through Euroclear or Clearstream. Upon consummation of the proposed transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Permanent Global Note, the Regulation S Temporary Global Note
and/or the Restricted Definitive Note and in the Indenture and the Securities Act. 

  

	 	3.	☐  Check and complete if Transferee will take delivery of a beneficial interest in a Restricted Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation
S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any
applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one): 

(a) ☐  such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act;

 or 
 (b)
☐  such Transfer is being effected to the Company or a subsidiary thereof; 
 or 

 (c) ☐  such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act; 
 or 

(d) ☐  such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption
from the registration requirements of the Securities Act other than Rule 144A, Rule 144, Rule 903 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under
the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit G to the Indenture and (2) if such Transfer is in respect of a principal amount of Notes at the time of transfer of less than $250,000, an Opinion of Counsel provided
by the Transferor or the Transferee (a copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the IAI Global Note and/or the Restricted Definitive Notes and in
the Indenture and the Securities Act. 
  

	 	4.	☐  Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or of an Unrestricted Definitive Note. 

(a)    ☐  Check if Transfer is pursuant to Rule 144. (i) The Transfer is being effected pursuant to
and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. 

(b)    ☐  Check if Transfer is Pursuant to Regulation S. (i) The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and
(ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of
the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in
the Indenture. 

 (c)    ☐  Check if Transfer is Pursuant to Other
Exemption. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture. 

This certificate and the statements contained herein are made for your benefit and the benefit of the Company. 

 

			
		 	  

		 	[Insert Name of Transferor]
		
	By:	 	  

	Name:	 	
	Title:	 	

 Dated:
                      

 ANNEX A TO CERTIFICATE OF TRANSFER 

 

							
	1.	  	The Transferor owns and proposes to transfer the following:
	
	[CHECK ONE OF (a) OR (b)]
				
		  	 (a)
	  	☐	  	a beneficial interest in the:
				
		  		  	(i)	  	☐  Rule 144A Global Note (CUSIP                     ), or
				
		  		  	(ii)	  	☐  Regulation S Global Note (CUSIP                     ); or
				
		  		  	(iii)	  	☐  IAI Global Note (CUSIP                     ); or
				
		  	 (b)
	  	☐	  	a Restricted Definitive Note.
		
	2.	  	After the Transfer the Transferee will hold:
	
	[CHECK ONE]
				
		  	 (a)
	  	☐	  	a beneficial interest in the:
				
		  		  	(i)	  	☐  Rule 144A Global Note (CUSIP                     ), or
				
		  		  	(ii)	  	☐  Regulation S Global Note (CUSIP                     ); or
				
		  		  	(iii)	  	☐  IAI Global Note (CUSIP                     ); or
				
		  		  	(iv)	  	☐  Unrestricted Global Note (CUSIP                     ).
				
		  	 (b)
	  	☐	  	Restricted Definitive Note; or
				
		  	 (c)
	  	☐	  	an Unrestricted Definitive Note,
			
		  		  	in accordance with the terms of the Indenture.

 EXHIBIT C 

FORM OF CERTIFICATE OF EXCHANGE 
 The Bank of New
York Mellon, as Trustee 
 500 Ross Street, 12th Floor 

Pittsburgh, PA 15262 
  

	cc:	Sabine Pass Liquefaction, LLC 

 c/o Cheniere Energy, Inc. 

700 Milam Street, Suite 1900 

Houston, TX 77002 
  

	 	Re:	5.00% Senior Secured Notes due 2037 issued by Sabine Pass Liquefaction, LLC 

 (CUSIP
                    ) 

Reference is hereby made to the Indenture, dated as of February 24, 2017, (the “Indenture”), among Sabine Pass
Liquefaction, LLC, as issuer (the “Company”), the Guarantors party thereto and The Bank of New York Mellon, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. 

                    , (the
“Owner”) owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $         in such Note[s] or interests (the
“Exchange”). In connection with the Exchange, the Owner hereby certifies that: 
 1.    Exchange
of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note 

(a)    ☐  Check if Exchange is from beneficial interest in a Restricted Global Note to beneficial
interest in an Unrestricted Global Note. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Global Notes and pursuant to and
in accordance with the Securities Act of 1933, as amended (the “Securities Act”), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. 

 (b)    ☐  Check if Exchange is from beneficial interest in
a Restricted Global Note to Unrestricted Definitive Note. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive
Note is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Definitive Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the United States. 

(c)    ☐  Check if Exchange is from Restricted Definitive Note to beneficial interest in an
Unrestricted Global Note. In connection with the Owner’s Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for
the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States. 
 (d)    ☐  Check if Exchange is from
Restricted Definitive Note to Unrestricted Definitive Note. In connection with the Owner’s Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is
being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the United States. 
 2.    Exchange of
Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes 

(a)    ☐  Check if Exchange is from beneficial interest in a Restricted Global Note to Restricted
Definitive Note. In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is
being acquired for the Owner’s own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act. 

 (b)    ☐  Check if Exchange is from Restricted Definitive
Note to beneficial interest in a Restricted Global Note. In connection with the Exchange of the Owner’s Restricted Definitive Note for a beneficial interest in the [CHECK ONE] ☐ Rule 144A Global Note or ☐ Regulation S Global Note or
☐ IAI Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer and (ii) such Exchange has been effected in compliance with
the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act. 

 This certificate and the statements contained herein are made for your benefit and the benefit of
the Company. 
  

			
		 	  

		 	[Insert Name of Transferor]
		
	By:	 	  

	Name:	 	
	Title:	 	

Dated:                      

 EXHIBIT D 

[FORM OF NOTATION OF GUARANTEE] 

For value received, each Guarantor (which term includes any successor Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the provisions in the Indenture dated as of February 24, 2017 (the “Indenture”) among Sabine Pass Liquefaction, LLC (the “Company”), the Guarantors
party thereto and The Bank of New York Mellon, as trustee (the “Trustee”), (a) the due and punctual payment of the principal of, premium, if any, and interest on, the Notes, whether at maturity, by acceleration, redemption or
otherwise, the due and punctual payment of interest on overdue principal of and interest on the Notes, if any, if lawful, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance
with the terms of the Indenture and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or otherwise. The obligations of the Guarantors to the Holders of Notes and to the Trustee pursuant to the Note Guarantee and the Indenture are expressly set forth in Article 11 of
the Indenture and reference is hereby made to the Indenture for the precise terms of the Note Guarantee. Each Holder of a Note, by accepting the same, agrees to and shall be bound by such provisions. 

Capitalized terms used but not defined herein have the meanings given to them in the Indenture. 

 

			
	[NAME OF GUARANTOR(S)]
		
	By:	 	  

	Name:	 	
	Title:	 	

 EXHIBIT E 

[FORM OF SUPPLEMENTAL INDENTURE 

TO BE DELIVERED BY SUBSEQUENT GUARANTORS] 

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of
            , 20    , among                      (the
“Guaranteeing Subsidiary”), a subsidiary of Sabine Pass Liquefaction, LLC (or its permitted successor), a Delaware limited liability company (the “Company”), the Company, the other Guarantors (as defined in the Indenture
referred to herein) and The Bank of New York Mellon, as trustee under the Indenture referred to below (the “Trustee”). 
 W
I T N E S S E T H 
 WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture (the
“Indenture”), dated as of February 24, 2017 providing for the issuance of 5.00% Senior Secured Notes due 2037 (the “Notes”); 

WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a
supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company’s Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the “Note
Guarantee”); and 
 WHEREAS, pursuant to Section 2.1(d) of Appendix A to the Indenture, the Trustee is authorized to execute and
deliver this Supplemental Indenture. 
 NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the
receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders as follows: 

1.    CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the
meanings assigned to them in the Indenture. 
 2.    AGREEMENT TO
GUARANTEE. The Guaranteeing Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Note Guarantee and in the Indenture including but not limited to Article 11
thereof. 
 3.    NO RECOURSE AGAINST OTHERS. No past,
present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Note
Guarantees, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the Notes. 

 4.    NEW YORK LAW TO GOVERN. THE LAW OF THE STATE OF NEW YORK SHALL GOVERN
AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW. 

5.    COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed
copy shall be an original, but all of them together represent the same agreement. 
 6.    EFFECT
OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 

7.    THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in
respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company. 

 IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly
executed and attested, all as of the date first above written. 
 Dated:
            , 20     
  

			
	[GUARANTEEING SUBSIDIARY]
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	SABINE PASS LIQUEFACTION, LLC
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	[EXISTING GUARANTORS]
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	 THE BANK OF NEW YORK MELLON

    as Trustee

		
	By:	 	  

		 	Authorized Signatory

 EXHIBIT F 

Additional Notes and Supplemental Indentures for Additional Notes 

Reference is made in this Exhibit F to the Indenture dated as of February 24, 2017 (the “Indenture”) among Sabine
Pass Liquefaction, LLC, (the “Company”), the Guarantors party thereto and The Bank of New York Mellon, as trustee (the “Trustee”). 

(a)    After the Notes Issue Date, subject to compliance with the Indenture, including Section 4.08 thereof,
Section 2.1 of Appendix A and this Exhibit F, the Company may issue Additional Notes, in one or more series, under this Indenture or under one or more Supplemental Indentures that comply with the provisions of this Indenture. Additional
Notes may be issued as a separate series or the same series as the Initial Notes or other Additional Notes, as shall be specified in the form of the Additional Note or in any Supplemental Indenture governing the terms of the Additional Notes
permitted to be issued by this Indenture. Additional Notes may be issued in accordance with the following provisions, which are deemed to be part of Section 2.1(d) of Appendix A to the Indenture: 

(b)    Capitalized terms used and not otherwise defined in this Exhibit F which are defined in Section 2.1(b) of Appendix
A or other Sections of the Indenture have the meanings set forth therein and the following terms have the meanings set forth below: 

“Board Resolution” means a resolution duly adopted by (1) the Board of Directors of the Company or (2) any pricing
or other committee of the Board of Directors of the Company duly authorized to act for it hereunder, a copy of which is delivered to the Trustee, accompanied by an Officer’s Certificate that such resolution has been duly adopted, has not been
amended, modified, supplemented or rescinded and is in full force and effect. 
 “Registered Additional Note” means any
Additional Note registered on the Additional Note Register maintained by the Company pursuant to Section 3.01 below. 

1.01. Terms of Additional Notes. (a) The terms and conditions of any Additional Notes shall be established in or pursuant to a
Board Resolution, and set forth in an Officer’s Certificate, or established in one or more Supplemental Indentures approved pursuant to a Board Resolution, and as set forth in an Officer’s Certificate, prior to the issuance of Additional
Notes of any series, which shall include, as applicable: 
 (i)    the title of the Additional Notes of
the series (which shall distinguish the Additional Notes of the series from all other Notes); 

(ii)    any limit upon the aggregate principal amount of the Additional Notes of the series which may be
authenticated and delivered under the Indenture (except for Additional Notes authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Additional Notes of the series) which amount must be in compliance
with the Indenture; 

 (iii)    the date or dates (or the manner of determining the
same) on which the principal of the Additional Notes of the series is payable (which, if so provided in or pursuant to such Board Resolution or in any Supplemental Indenture, may be determined by the Company from time to time and set forth in the
Additional Notes of the series issued from time to time); 
 (iv)    the rate or rates (or the method of
determining the same) at which the Additional Notes of the series shall bear interest, if any, and the date or dates from which such interest shall accrue (which, in the case of either or both, if so provided in or pursuant to such Board Resolution
or in any Supplemental Indenture, may be determined by the Company from time to time and set forth in the Additional Notes of the series issued from time to time), the dates (or the manner of determining the same) on which such principal and
interest, if any, shall be payable, the record dates (or the manner of determining the same), if any, for the determination of Holders to whom principal and interest is payable on any payment date; 

(v)    the place or places where, subject to the Indenture, the principal of (and premium, if any) and
interest, if any, on Additional Notes of the series shall be payable, any Additional Notes of the series may be surrendered for registration of transfer and Additional Notes of the series may be surrendered for exchange and the place or places where
notices or demands to or upon the Company in respect of the Additional Notes of the series may be served; 

(vi)    the period or periods within which, the price or prices at which, and the terms and conditions upon
which Additional Notes of the series may be redeemed, in whole or in part, at the option of the Company, pursuant to any sinking fund or otherwise; 

(vii)    the obligation, if any, of the Company to redeem, repay, prepay or purchase Additional Notes of
the series pursuant to any mandatory prepayment, purchase or redemption provision, sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which, and the terms and
conditions upon which Additional Notes of the series shall be redeemed, repaid, prepaid or purchased, in whole or in part, pursuant to such obligation, or at the option of a Holder thereof; 

(viii)    if other than denominations of U.S. $1,000 and any integral multiple thereof, the denominations
in which Additional Notes of the series shall be issuable; 
 (ix)    if other than the principal amount
thereof, the portion of the principal amount of Additional Notes of the series which shall be payable upon declaration of acceleration of the maturity thereof or the method by which such portion shall be determined; 

(x)    if the amount of payments of principal of (or any premium) or any interest on the Additional Notes
of the series may be determined with reference to an index, the manner in which such amounts shall be determined; 

 (xi)    whether the Additional Notes of the series shall be
issued in whole or in part in the form of a Global Additional Note or Notes and, in such case, the Depositary for such Global Additional Note or Notes, if other than DTC, whether such global form shall be permanent or temporary and, if so, whether
beneficial owners of interests in any such Global Additional Note may exchange such interests for Additional Notes of such series in certificated form and of like tenor of any authorized form and denomination and the circumstances under which any
such exchanges may occur, if other than in the manner provided in this Indenture; 
 (xii)    in the case
of any Global Additional Note that may be exchanged for other Additional Notes, the manner and procedures for effecting such exchange; 

(xiii)    whether and under what circumstances, and the terms and conditions on which, the Company will pay
additional amounts on the Additional Notes of the series in respect of any tax, assessment or governmental charge withheld or deducted and whether the Company will have the option to redeem such Additional Notes rather than pay such additional
amounts or to redeem such Additional Notes in the event of the imposition of any certification, documentation, information or other reporting requirement and, if so, under what circumstances and the terms and conditions on which the Company may
exercise such option; and 
 (xiv)    any other terms of the series of Additional Notes which terms must
be consistent with the provisions of the Indenture and, with respect to the matters set forth in Articles 4, 5, 6, 9, 10 (if any Additional Note is secured by any Collateral) and 11 (if any Additional Note is guaranteed by any guarantor of the
Notes) (and any defined terms used therein) must be the same as those provisions (and any defined terms used therein). 

(b)    All Additional Notes of any one series shall be substantially identical except that such Additional Notes may
differ as to date of issue and the date from which interest, if any, shall accrue. The terms of such Additional Notes, as set forth above, may be determined by the Company from time to time if so provided in or pursuant to such Board Resolution or
in any Supplemental Indenture for Additional Notes. All Additional Notes of any one series need not, but may, be issued at the same time. 

(c)    If any terms of any series of Additional Notes are established by action taken pursuant to a Board Resolution, a
copy of an appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officer’s Certificate setting forth the terms of the
series. 
 1.02. Issuance of Additional Notes. (a) When authorized by a Board Resolution, Additional Notes may be issued either
pursuant to the Indenture or pursuant to a Supplemental Indenture, in each case, without the consent of the Holders of any Notes, subject to compliance with the provisions of this Indenture. 

(b) In authenticating or delivering any Additional Notes under the Indenture, or in executing, or accepting the additional trusts created by,
any Supplemental Indenture for Additional Notes permitted by the Indenture, the Trustee shall be entitled to receive, and shall be 

 
fully protected in relying upon, and the Company shall cause to be provided, an Opinion of Counsel that (subject to customary exceptions and assumptions): 

(i)     the form or forms of such Additional Notes and any Supplemental Indenture for Additional Notes have
been established in conformity with, and comply with, the provisions of the Indenture; 
 (ii)     the
terms of such Additional Notes and any Supplemental Indenture for Additional Notes have been established in conformity with, and comply with, the provisions of the Indenture; 

(iii)    such Additional Notes, when authenticated and delivered by the Trustee and issued by the Company
in the manner and subject to any conditions specified in such opinion of counsel, will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting the enforcement of creditors’ rights and to general equity principles; and 

(iv)     the execution and delivery by the Company of such Additional Notes and any Supplemental Indenture
for Additional Notes (A) have been duly authorized by all necessary limited liability company, managing member or other action on the part of the Company or its members and (B) will not violate the limited liability company agreement,
certificate of formation or other organizational documents of the Company, any law binding on the Company, or the Indenture and the other Financing Documents. 

In executing any amendment, modification or supplement of any Additional Notes or any Supplemental Indenture for Additional Notes, the Trustee shall be
entitled to receive, and shall be fully protected in relying upon, and the Company shall cause to be provided, an Opinion of Counsel stating that the amendment, modification or supplement of any Additional Notes or Supplemental Indenture for
Additional Notes is authorized or permitted by the Indenture. 
 (c)    The Trustee and the Company, at any time and
from time to time, may enter into one or more Supplemental Indentures, in form satisfactory to the Trustee, (i) to establish the forms or terms of Additional Notes of any series permitted by this Indenture or (ii) to amend such forms or
terms in any manner, solely to the extent such amendment is permitted by the terms of this Indenture. The Trustee may, but shall not be obligated to, enter into any such Supplemental Indenture for Additional Notes which affects the Trustee’s
own rights, duties or immunities under this Indenture or otherwise. 
 (d)    Upon the execution of any Supplemental
Indenture for Additional Notes, any such Supplemental Indenture shall form a part of this Indenture for purposes of such Additional Notes and upon the execution of any amendment, modification or supplement of any Supplemental Indenture for
Additional Notes in accordance with this Indenture, the Holders of Additional Notes of any series affected thereby theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. 

 (e)    Additional Notes of any series authenticated and delivered after the
execution of any Supplemental Indenture for Additional Notes may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such Supplemental Indentures. If the Company shall so determine,
new Additional Notes of any series, so modified as to conform, in the opinion of the Trustee and the Board of Directors, to any such Supplemental Indenture for Additional Notes may be prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for outstanding Additional Notes of such series. 
 2.01 Form of Additional Notes. (a) Any
Additional Notes of the same series as the Initial Notes will be in the form or forms provided in Sections 2.1 (b), (c) or (d), as applicable, of Appendix A to the Indenture. 

(b)    Any Additional Notes of a separate series from the Initial Notes will be in such form or forms, subject to the
compliance with all other provisions of this Indenture, as shall be established in or pursuant to a Board Resolution (and set forth in a Board Resolution or, to the extent established pursuant to (rather than as set forth in) such Board Resolution,
in an Officer’s Certificate as to such establishment) or in one or more Supplemental Indentures for the Additional Notes permitted to be issued by this Indenture approved pursuant to a Board Resolution 

(c)    Except as provided in Section 2.01(b) above, the Additional Notes of each series shall be issued as
(i) Registered Additional Notes or (ii) Global Additional Notes. 
 (d)    Additional Notes may be issued, in
each case, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture or any Supplemental Indenture for Additional Notes, shall have such legends as may be required by Applicable
Law, and may have such letters, numbers or other marks of identification and such other legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange, Depositary or clearing organization, or to conform
to usage, as may, consistently herewith, be determined by the officers of the Company executing such Additional Notes, as evidenced by their execution of such Additional Notes. 

(e)    Each Additional Note (including a Global Additional Note) shall be dated the date of its authentication. 

(d)    The Company in issuing the Additional Notes may use “CUSIP,” “CINS,” “ISIN” and other
reference numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP,” “CINS,” “ISIN” and other such reference numbers in notices as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers either as printed on the Additional Notes or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on
the Additional Notes, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any changes in the “CUSIP,” “CINS,” “ISIN” or the other
such reference numbers. 

 2.02 Form of Trustee Authentication for Additional Notes. 

(a)    The Trustee’s Certificate of Authentication on all Additional Notes shall be in substantially the following
form: 
 “This is one of the Additional Notes of the series designated therein referred to in the within-mentioned Indenture. 

 

					
		 		 	 [INSERT NAME OF TRUSTEE],

as Trustee

			
		 	By	 	  

		 		 	Authorized Officer”

 3.01 Registration, Registration of Transfer and Exchange. (a) If the Additional Notes of or within
a series are issuable as a Global Additional Note, the provisions of Section 2.3 of Appendix A to the Indenture shall apply to the transfer and exchange of the Global Additional Note. 

(b)    If the Additional Notes of or within a series are issuable as a Registered Additional Note that is not a Global
Additional Note, the Company shall cause to be kept a register or registers in respect of each series of Additional Notes (herein sometimes referred to as the “Additional Note Register”) in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration of Registered Additional Notes of such series and the registration of transfers of Registered Additional Notes of such series. 

(b)    Upon surrender for registration of transfer of any Registered Additional Note of any series at the office or agency
of the Company maintained for such purpose in respect of such series, but subject to any restrictions thereon, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or
more new Registered Additional Notes of such series of any authorized denominations, of a like stated maturity and aggregate principal amount and with like terms and conditions. 

(c)    At the option of the Holder, Registered Additional Notes of any series may be exchanged for one or more other
Registered Additional Notes of such series of any authorized denominations, of a like stated maturity and aggregate principal amount and with like terms and conditions, upon surrender of the Registered Additional Notes to be exchanged at any such
office or agency. 
 (d)    Whenever any Registered Additional Notes are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Additional Notes which the Holder making the exchange is entitled to receive. 

(f)    All Additional Notes issued upon any registration of transfer or exchange of Additional Notes shall be the valid
obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Additional Notes surrendered upon such registration of transfer or exchange. 

 (g)    Every Registered Additional Note of a series presented or surrendered
for registration of transfer or exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company, the Trustee and the Additional Note Registrar
in respect of such series duly executed, by the Holder thereof or such Holder’s attorney duly authorized in writing. 

(h)    No service charge shall be made for any registration of transfer or exchange of Additional Notes, but the Company
may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Additional Notes. 

(i)    The Company shall not be required (A) to issue, register the transfer of or exchange any Additional Note of
any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Additional Notes of such series selected for redemption hereunder and ending at the close of business on the day of
such mailing or (B) to register the transfer of or exchange any Registered Additional Note of such series so selected for redemption in whole or in part, except the unredeemed portion of any Registered Additional Note being redeemed in part.

 3.02 Persons Deemed Owners. (a) The Company, the Trustee and any paying agent, the Additional Note registrar and any other
agent of the Company or the Trustee in respect of the Additional Notes of any series may treat the Person in whose name any Registered Additional Note of such series is registered as the owner of such Registered Additional Note for the purpose of
receiving payment of principal of (and premium, if any) and interest, if any, on such Registered Additional Note and for all other purposes whatsoever, whether or not such Registered Additional Note be overdue, and neither the Company nor the
Trustee nor any paying agent, Additional Note registrar or other agent of the Company or the Trustee in respect of the Registered Additional Notes of such series shall be affected by notice to the contrary. 

(b)    None of the Company, the Trustee and any paying agent, the Additional Note registrar and any other agent of the
Company or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a Global Additional Note or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests. 
 (c)    Notwithstanding the foregoing, with respect to any
Global Additional Note, nothing herein shall prevent the Company, the Trustee, or any agent of the Company or the Trustee, from giving effect to any written certification, proxy or other authorization furnished by any Depositary, as a Holder, with
respect to such Global Additional Note or impair, as between such Depositary and owners of beneficial interests in such Global Additional Note, the operation of customary practices governing the exercise of the rights of such Depositary (or its
nominee) as Holder of such Global Additional Note. 

 EXHIBIT G 

FORM OF CERTIFICATE FROM 

ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR 
 The
Bank of New York Mellon, as Trustee 
 500 Ross Street, 12th Floor 

Pittsburgh, PA 15262 
  

	cc:	Sabine Pass Liquefaction, LLC 

 c/o Cheniere Energy, Inc. 

700 Milam Street, Suite 1900 

Houston, TX 77002 
  

	 	Re:	5.00% Senior Secured Notes due 2037 issued by Sabine Pass Liquefaction, LLC 

 Reference is
hereby made to the Indenture, dated as of February 24, 2017 (the “Indenture”), among Sabine Pass Liquefaction, LLC, as issuer (the “Company”), the guarantors party thereto and The Bank of New York Mellon, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. 
 In connection with our proposed
purchase of $          aggregate principal amount of: 
  

	 	(a)	☐  a beneficial interest in a Global Note, or 

  

	 	(b)	☐  a Definitive Note, 

 we confirm that: 

1.    We understand that any subsequent transfer of the Notes or any interest therein is subject to certain restrictions
and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes or any interest therein except in compliance with, such restrictions and conditions and the Securities Act
of 1933, as amended (the “Securities Act”). 
 2.    We understand that the offer and sale of the Notes have
not been registered under the Securities Act, and that the Notes and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as
hereinafter stated, that if we should sell the Notes or any interest therein, we will do so only (A) to the Company or any subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to a “qualified institutional
buyer” (as defined therein), (C) to an institutional “accredited investor” (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and, if such transfer is in respect of a principal amount of Notes, at the time of transfer of less than $250,000, an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such
transfer is in compliance with the Securities 

 
Act, (D) outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the provisions of Rule 144 under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any Person purchasing the Definitive Note or beneficial interest in a Global Note from us in a transaction meeting the requirements
of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated herein. 

3.    We understand that, on any proposed resale of the Notes or beneficial interest therein, we will be required to
furnish to you and the Company such certifications, legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Notes
purchased by us will bear a legend to the foregoing effect. 
 4.    We are an institutional “accredited
investor” (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our
investment in the Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment. 

5.    We are acquiring the Notes or beneficial interest therein purchased by us for our own account or for one or more
accounts (each of which is an institutional “accredited investor”) as to each of which we exercise sole investment discretion. 

You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. 
  

			
	                                    
                                         
         
		 	[Insert Name of Accredited Investor]
		
	By:	 	  

	Name:	 	
	Title:	 	

 Dated:Exhibit 10.1

 

EXECUTION COPY

 

$100,000,000

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

Dated as of February 24, 2017

 

among

 

FIVE STAR QUALITY CARE, INC.,

 

as Borrower,

 

THE GUARANTORS NAMED HEREIN,

 

as Guarantors,

 

THE INITIAL LENDERS, INITIAL ISSUING BANK AND SWING LINE BANK NAMED HEREIN,

 

as Initial Lenders, Initial Issuing Bank and Swing Line Bank,

 

and

 

CITIBANK, N.A.

 

as Administrative Agent and as Collateral Agent,

 

with

 

RBC CAPITAL MARKETS*

 

as Syndication Agent,

 

and

 

CITIGROUP GLOBAL MARKETS INC. AND RBC CAPITAL MARKETS*

 

as Joint Lead Arrangers and Joint Book Running Managers

 

*                                         RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its affiliates.

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I
    
	
DEFINITIONS AND ACCOUNTING TERMS
    
	
 
    
	
SECTION 1.01
    	
Certain Defined Terms
    	
1
    
	
SECTION 1.02
    	
Computation of Time   Periods; Other Definitional Provisions
    	
33
    
	
SECTION 1.03
    	
Accounting Terms
    	
33
    
	
 
    	
 
    	
 
    
	
ARTICLE II
    
	
AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF   CREDIT
    
	
 
    
	
SECTION 2.01
    	
The Advances and the   Letters of Credit
    	
33
    
	
SECTION 2.02
    	
Making the Advances
    	
34
    
	
SECTION 2.03
    	
Issuance of and   Drawings and Reimbursement Under Letters of Credit
    	
36
    
	
SECTION 2.04
    	
Repayment of Advances
    	
38
    
	
SECTION 2.05
    	
Termination or   Reduction of the Commitments
    	
39
    
	
SECTION 2.06
    	
Prepayments
    	
39
    
	
SECTION 2.07
    	
Interest
    	
40
    
	
SECTION 2.08
    	
Fees
    	
41
    
	
SECTION 2.09
    	
Conversion of Advances
    	
42
    
	
SECTION 2.10
    	
Increased Costs, Etc.
    	
42
    
	
SECTION 2.11
    	
Payments and   Computations
    	
44
    
	
SECTION 2.12
    	
Taxes
    	
46
    
	
SECTION 2.13
    	
Sharing of Payments,   Etc.
    	
50
    
	
SECTION 2.14
    	
Use of Proceeds
    	
51
    
	
SECTION 2.15
    	
Evidence of Debt
    	
51
    
	
SECTION 2.16
    	
Extensions of   Termination Date
    	
52
    
	
SECTION 2.17
    	
Defaulting Lenders
    	
52
    
	
SECTION 2.18
    	
Replacement of Lenders
    	
54
    
	
SECTION 2.19
    	
Increase in the   Aggregate Commitments
    	
55
    
	
SECTION 2.20
    	
Reallocation of Lender   Pro Rata Shares; No Novation
    	
57
    
	
 
    	
 
    	
 
    
	
ARTICLE III
    
	
CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF   CREDIT
    
	
 
    
	
SECTION 3.01
    	
Conditions Precedent to   Initial Extension of Credit
    	
58
    
	
SECTION 3.02
    	
Conditions Precedent to   Each Borrowing, Issuance, Renewal, Increase and Extension
    	
64
    
	
SECTION 3.03
    	
Determinations Under   Section 3.01 and 3.02
    	
65
    
	
 
    	
 
    	
 
    
	
ARTICLE IV
    
	
REPRESENTATIONS AND WARRANTIES
    
	
 
    
	
SECTION 4.01
    	
Representations and   Warranties of the Loan Parties
    	
65
    
	
 
    	
 
    	
 
    
	
ARTICLE V
    
	
COVENANTS OF THE LOAN PARTIES
    
	
 
    
	
SECTION 5.01
    	
Affirmative Covenants
    	
76
    
	
SECTION 5.02
    	
Negative Covenants
    	
84
    
	
SECTION 5.03
    	
Reporting Requirements
    	
90
    
	
SECTION 5.04
    	
Financial Covenants
    	
94
    

 

i

 

	
ARTICLE VI
    
	
EVENTS OF   DEFAULT
    
	
 
    
	
SECTION 6.01
    	
Events of Default
    	
95
    
	
SECTION 6.02
    	
Actions in Respect of   the Letters of Credit upon Default
    	
97
    
	
 
    	
 
    	
 
    
	
ARTICLE VII
    
	
GUARANTY
    
	
 
    
	
SECTION 7.01
    	
Guaranty; Limitation of   Liability
    	
97
    
	
SECTION 7.02
    	
Guaranty Absolute
    	
98
    
	
SECTION 7.03
    	
Waivers and   Acknowledgments
    	
99
    
	
SECTION 7.04
    	
Subrogation
    	
100
    
	
SECTION 7.05
    	
Guaranty Supplements
    	
100
    
	
SECTION 7.06
    	
Indemnification by   Guarantors
    	
100
    
	
SECTION 7.07
    	
Subordination
    	
101
    
	
SECTION 7.08
    	
Continuing Guaranty
    	
101
    
	
SECTION 7.09
    	
Keepwell
    	
102
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII
    
	
THE AGENTS
    
	
 
    
	
SECTION 8.01
    	
Authorization and   Action; Appointment of Supplemental Collateral Agents
    	
102
    
	
SECTION 8.02
    	
Agents’ Reliance, Etc.
    	
103
    
	
SECTION 8.03
    	
Citibank and Affiliates
    	
103
    
	
SECTION 8.04
    	
Lender Party Credit   Decision
    	
103
    
	
SECTION 8.05
    	
Indemnification by   Lender Parties
    	
104
    
	
SECTION 8.06
    	
Successor Agents
    	
104
    
	
SECTION 8.07
    	
Relationship of Agents   and Lenders
    	
105
    
	
 
    	
 
    	
 
    
	
ARTICLE IX
    
	
MISCELLANEOUS
    
	
 
    
	
SECTION 9.01
    	
Amendments, Etc.
    	
105
    
	
SECTION 9.02
    	
Notices, Etc.
    	
107
    
	
SECTION 9.03
    	
No Waiver; Remedies
    	
108
    
	
SECTION 9.04
    	
Costs and Expenses
    	
109
    
	
SECTION 9.05
    	
Right of Set-off
    	
110
    
	
SECTION 9.06
    	
Binding Effect
    	
110
    
	
SECTION 9.07
    	
Assignments and   Participations; Replacement Notes
    	
111
    
	
SECTION 9.08
    	
Execution in   Counterparts
    	
114
    
	
SECTION 9.09
    	
Severability
    	
114
    
	
SECTION 9.10
    	
Usury Not Intended
    	
114
    
	
SECTION 9.11
    	
No Liability of the   Issuing Banks
    	
115
    
	
SECTION 9.12
    	
Confidentiality
    	
115
    
	
SECTION 9.13
    	
Release of Collateral
    	
117
    
	
SECTION 9.14
    	
Patriot Act   Notification
    	
118
    
	
SECTION 9.15
    	
Jurisdiction, Etc.
    	
118
    
	
SECTION 9.16
    	
Governing Law
    	
118
    
	
SECTION 9.17
    	
WAIVER OF JURY TRIAL
    	
118
    
	
SECTION 9.18
    	
No Fiduciary Duties
    	
118
    
	
SECTION 9.19
    	
Acknowledgement and   Consent to Bail-In of EEA Financial Institutions
    	
119
    

 

ii

 

	
SCHEDULES
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Schedule I
    	
-
    	
Commitments and   Applicable Lending Offices
    
	
Schedule II
    	
-
    	
Borrowing Base Assets
    
	
Schedule 4.01(f)
    	
-
    	
Material Litigation
    
	
 
    	
 
    	
 
    
	
EXHIBITS
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Exhibit A
    	
-
    	
Form of Note
    
	
Exhibit B
    	
-
    	
Form of Notice of   Borrowing
    
	
Exhibit C
    	
-
    	
Form of Guaranty   Supplement
    
	
Exhibit D
    	
-
    	
Form of Assignment   and Acceptance
    
	
Exhibit E-1
    	
-
    	
Form of Opinion of   Sullivan & Worcester LLP
    
	
Exhibit E-2
    	
-
    	
Form of Opinion of   Local Counsel for the Loan Parties with respect to Real Estate Matters
    
	
Exhibit E-3
    	
-
    	
Form of Corporate   Formalities Opinion of Corporate Formalities Counsel
    
	
Exhibit F
    	
-
    	
Form of Security   Agreement
    
	
Exhibit G
    	
-
    	
Form of Mortgage
    
	
Exhibit H
    	
-
    	
Form of Borrowing   Base Certificate
    
	
Exhibit I-1
    	
-
    	
Form of   Section 2.12(g) U.S. Tax Compliance Certificate
    
	
 
    	
 
    	
(For Foreign Lender   Parties That Are Not Partnerships For U.S. Federal Income Tax Purposes)
    
	
Exhibit I-2
    	
-
    	
Form of   Section 2.12(g) U.S. Tax Compliance Certificate
    
	
 
    	
 
    	
(For Foreign   Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)
    
	
Exhibit I-3
    	
-
    	
Form of   Section 2.12(g) U.S. Tax Compliance Certificate
    
	
 
    	
 
    	
(For Foreign   Participants That Are Partnerships For U.S. Federal Income Tax Purposes)
    
	
Exhibit I-4
    	
-
    	
Form of   Section 2.12(g) U.S. Tax Compliance Certificate
    
	
 
    	
 
    	
(For Foreign Lender   Parties That Are Partnerships For U.S. Federal Income Tax Purposes)
    
	
Exhibit J
    	
-
    	
Form of Compliance   Certificate
    

 

iii

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

AMENDED AND RESTATED CREDIT AGREEMENT dated as of February 24, 2017 (this “Agreement”) among FIVE STAR QUALITY CARE, INC., a Maryland corporation (the “Borrower”), the entities listed on the signature pages hereof as the subsidiary guarantors (together with any Additional Guarantors (as hereinafter defined) acceding hereto pursuant to Section 5.01(j) or 7.05, the “Guarantors”), the banks, financial institutions and other institutional lenders listed on the signature pages hereof as the initial lenders (the “Initial Lenders”), the Swing Line Bank (as hereinafter defined), CITIBANK, N.A., as the initial issuer of Letters of Credit (as hereinafter defined) (the “Initial Issuing Bank”), CITIBANK, N.A. (“Citibank”), as administrative agent (together with any successor administrative agent appointed pursuant to Article VIII, the “Administrative Agent”) for the Lender Parties (as hereinafter defined), and Citibank, as collateral agent (together with any successor collateral agent appointed pursuant to Article VIII, the “Collateral Agent”, and together with the Administrative Agent, the “Agents”; each an “Agent”) for the Secured Parties (as hereinafter defined), with RBC CAPITAL MARKETS* (“RBCCM”), as syndication agent, and CITIGROUP GLOBAL MARKETS INC. (“CGMI”) and RBCCM, as joint lead arrangers and joint book running managers (the “Arrangers”).

 

W  I  T  N  E  S  S  E  T  H:

 

WHEREAS, pursuant to that certain Credit Agreement dated as of April 13, 2012 among the Borrower, the guarantors party thereto, the lenders party thereto, the Administrative Agent and the Collateral Agent (as amended or modified to date, the “Existing Agreement”), the lenders party thereto agreed to extend certain commitments to make certain extensions of credit available to the Borrower; and

 

WHEREAS, the Borrower, the Guarantors, the Administrative Agent, the Collateral Agent and the lenders party to the Existing Agreement desire to amend and restate the Existing Agreement to make certain amendments thereto;

 

NOW, THEREFORE, in consideration of the recitals set forth above, which by this reference are incorporated into the operative provisions of this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and subject to the terms and conditions hereof and on the basis of the representations and warranties herein set forth, the parties hereby agree to amend and restate the Existing Agreement to read in its entirety as herein set forth.

 

ARTICLE I
 DEFINITIONS AND ACCOUNTING TERMS

 

SECTION 1.01                                 Certain Defined Terms.  As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):

 

“ABP Stockholders” means ABP Trust, a Maryland statutory trust (“ABP Trust”) and any of ABP Trust’s Affiliates, including The RMR Group LLC, a Maryland limited liability company (“RMR LLC”) and any entity to which RMR LLC provides management services.

 

“ABP Transaction” has the meaning specified in the definition of Change of Control.

 

“ABP Trust” has the meaning specified in the definition of ABP Stockholders.

 

“Acceding Lender” has the meaning specified in Section 2.19(d).

 

*                                         RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its affiliates.

 

 

“Accession Agreement” has the meaning specified in Section 2.19(d).

 

“Additional Guarantor” has the meaning specified in Section 7.05.

 

“Adjusted EBITDA” means (a) EBITDA for the consecutive four fiscal quarters most recently ended for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be, less (b) the Capital Expenditure Reserve for all Assets for such four fiscal quarters.

 

“Adjusted Net Operating Income” means, with respect to any Borrowing Base Asset, (a) the Net Operating Income attributable to such Borrowing Base Asset less (b) the Capital Expenditure Reserve for such Borrowing Base Asset, less (c) the Management Fee Adjustment for such Borrowing Base Asset, in each case for the consecutive four fiscal quarters most recently ended for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03 (b) or (c), as the case may be.

 

“Administrative Agent” has the meaning specified in the recital of parties to this Agreement.

 

“Administrative Agent’s Account” means the account of the Administrative Agent maintained by the Administrative Agent with Citibank, N.A., at its office at 1615 Brett Road OPS III, New Castle, DE 19720, ABA No. 021000089, Account No. 36852248, Account Name:  Agency/Medium Term Finance, Reference:  Five Star Quality Care, Attention:  Global Loans/Agency, or such other account as the Administrative Agent shall specify in writing to the Lender Parties.

 

“Advance” means a Revolving Credit Advance, a Swing Line Advance or a Letter of Credit Advance.

 

“Affiliate” means, as to any Person, any other Person that, directly or indirectly, controls, is controlled by or is under common control with such Person or is a director or officer of such Person.  For purposes of this definition, the term “control” (including the terms “controlling”, “controlled by” and “under common control with”) of a Person means the possession, direct or indirect, of the power to vote 5% or more of the Voting Interests of such Person or to direct or cause the direction of the management and policies of such Person, whether through the ownership of Voting Interests, by contract or otherwise.  For purposes of this Agreement, the Borrower and its Subsidiaries shall not be deemed to be Affiliates of SNH and its Subsidiaries so long as each of the board of directors of the Borrower and the board of trustees of SNH has at least one independent member who does not serve as both a director of the Borrower and a trustee of SNH.

 

“Agents” has the meaning specified in the recital of parties to this Agreement.

 

“Agreement” has the meaning specified in the recital of parties to this Agreement.

 

“Agreement Value” means, for each Hedge Agreement, on any date of determination, an amount determined by the Administrative Agent equal to:  (a) in the case of a Hedge Agreement documented pursuant to the Master Agreement (Multicurrency-Cross Border) published by the International Swap and Derivatives Association, Inc. (the “Master Agreement”), the amount, if any, that would be payable by any Loan Party or any of its Subsidiaries to its counterparty to such Hedge Agreement, as if (i) such Hedge Agreement was being terminated early on such date of determination, (ii) such Loan Party or Subsidiary was the sole “Affected Party”, and (iii) the Administrative Agent was the sole party determining such payment amount (with the Administrative Agent making such determination pursuant to the provisions of the above-described Master Agreement); or (b) in the case of a Hedge Agreement traded on an exchange, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary of a Loan Party to such Hedge Agreement determined by the Administrative Agent based on the settlement price of such Hedge Agreement on such date of determination; or (c) in all other cases, the mark-to-market

 

2

 

value of such Hedge Agreement, which will be the unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary of a Loan Party to such Hedge Agreement determined by the Administrative Agent as the amount, if any, by which (i) the present value of the future cash flows to be paid by such Loan Party or Subsidiary exceeds (ii) the present value of the future cash flows to be received by such Loan Party or Subsidiary pursuant to such Hedge Agreement; capitalized terms used and not otherwise defined in this definition shall have the respective meanings set forth in the above-described Master Agreement.

 

“Anti-Corruption Laws” shall mean all laws, rules, and regulations of any jurisdiction applicable to the Borrower or its Subsidiaries from time to time concerning or relating to bribery, corruption or money laundering including, without limitation, the United Kingdom Bribery Act of 2010 and the United States Foreign Corrupt Practices Act of 1977, as amended.

 

“Anti-Kickback Statute” has the meaning specified in Section 4.01(y).

 

“Applicable Lending Office” means, with respect to each Lender Party, such Lender Party’s Domestic Lending Office in the case of a Base Rate Advance and such Lender Party’s Eurodollar Lending Office in the case of a Eurodollar Rate Advance.

 

“Applicable Margin” means (a) 2.50% per annum with respect to each Eurodollar Rate Advance and (b) 1.50% per annum with respect to each Base Rate Advance.

 

“Appraisal” means an appraisal complying with the requirements of the Federal Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended from time to time, commissioned by and prepared for the account of the Administrative Agent (for the benefit of the Lenders) by a MAI appraiser selected by the Administrative Agent in consultation with the Borrower, and otherwise in scope, form and substance satisfactory to the Collateral Agent.  A true and correct copy of each Appraisal delivered to the Administrative Agent shall, promptly after Administrative Agent’s review thereof, be provided by the Administrative Agent to each Lender Party.

 

“Appraised Value” means, for any Borrowing Base Asset, the “as-is” fair market value of such Borrowing Base Asset (determined free and clear of all liens and encumbrances), as set forth in the Appraisal of such Borrowing Base Asset delivered prior to the Closing Date or the date such Asset is added as a Borrowing Base Asset.

 

“Approved Electronic Communications” means each Communication that any Loan Party is obligated to, or otherwise chooses to, provide to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein, including any financial statement, financial and other report, notice, request, certificate and other information materials required to be delivered pursuant to Section 5.03; provided, however, that solely with respect to delivery of any such Communication by any Loan Party to the Administrative Agent and without limiting or otherwise affecting either the Administrative Agent’s right to effect delivery of such Communication by posting such Communication to the Approved Electronic Platform or the protections afforded hereby to the Administrative Agent in connection with any such posting, “Approved Electronic Communication” shall exclude (i) any notice of borrowing, letter of credit request, swing loan request, notice of conversion or continuation, and any other notice, demand, communication, information, document and other material relating to a request for a new, or a conversion of an existing, Borrowing, (ii) any notice pursuant to Section 2.06 (a) and any other notice relating to the payment of any principal or other amount due under any Loan Document prior to the scheduled date therefor, (iii) all notices of any Default or Event of Default and (iv) any notice, demand, communication, information, document and other material required to be delivered to satisfy any of the conditions set forth in Article III or any other condition to any Borrowing or other extension of credit hereunder or any condition precedent to the effectiveness of this Agreement.

 

“Approved Electronic Platform” has the meaning specified in Section 9.02(c).

 

3

 

“Approved Manager” means with respect to any Healthcare Asset (i) an Affiliate of the Borrower, or (ii) a nationally recognized manager of Healthcare Assets (a) with (or controlled by a Person or Persons with) at least ten years of experience in the Healthcare Asset management industry, (b) that is engaged pursuant to a written management agreement or similar agreement in form and substance reasonably satisfactory to the Administrative Agent and (c) that has entered into a subordination agreement in form and substance reasonably satisfactory to the Administrative Agent.  The Administrative Agent confirms that as of the Closing Date the existing managers of the Healthcare Assets shown on Part III of Schedule 4.01 (q) to the Disclosure Letter are satisfactory to the Administrative Agent.  For purposes of this definition, the term “control” (including the term “controlled by”) of a Person means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of Voting Interests, by contract or otherwise.

 

“Arrangers” has the meaning specified in the recital of parties to this Agreement.

 

“Assets” means Healthcare Assets, Development Assets and Joint Venture Assets.

 

“Asset Value” means, at any date of determination, (a) in the case of any Healthcare Asset, the Appraised Value of such Asset, (b) in the case of any Development Asset, the gross book value of such Development Asset as determined in accordance with GAAP, (c) in the case of any Joint Venture Asset that, but for such Asset being owned by a Joint Venture, would qualify as a Healthcare Asset under the definition thereof, the JV Pro Rata Share of the Appraised Value of such Asset and (d) in the case of any other Joint Venture Asset, the JV Pro Rata Share of the gross book value of such Joint Venture Asset as determined in accordance with GAAP.

 

“Assignment and Acceptance” means an assignment and acceptance entered into by a Lender Party and an Eligible Assignee, and accepted by the Administrative Agent, in accordance with Section 9.07 and in substantially the form of Exhibit D hereto.

 

“Available Amount” of any Letter of Credit means, at any time, the maximum amount available to be drawn under such Letter of Credit at such time (assuming compliance at such time with all conditions to drawing).

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

“Bankruptcy Law” means any applicable law governing a proceeding of the type referred to in Section 6.01(f) or Title 11, U.S. Code, or any similar foreign, federal or state law for the relief of debtors.

 

“Base Rate” means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to the highest of (a) the rate of interest announced publicly by Citibank, N.A. in New York, New York, from time to time, as Citibank, N.A.’s base rate, (b) 1⁄2 of 1% per annum above the Federal Funds Rate and (c) the one-month Eurodollar Rate plus 1% per annum; provided, however, that in no circumstance shall the Base Rate be less than 0% per annum.  Citibank’s base rate is a rate set by Citibank based upon various factors, including Citibank’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate.  Any change in such base rate announced by Citibank shall take effect at the opening of business on the day specified in the public announcement of such change.

 

4

 

 

“Base Rate Advance” means an Advance that bears interest as provided in Section 2.07(a)(i).

 

“BBA Proposal Package” means, with respect to any Proposed Borrowing Base Asset, the following items, each in form and substance satisfactory to the Administrative Agent and in sufficient copies for each Lender:  (a) a description of such Asset in detail satisfactory to the Administrative Agent, (b) a projected cash flow analysis of such Asset, (c) a statement of operating expenses for such Asset for the immediately preceding 36 consecutive calendar months, (d) an operating expense and capital expenditures budget for such Asset for the next succeeding 12 consecutive months, and (e) if such Asset is then the subject of an acquisition transaction, a copy of the purchase agreement with respect thereto and a schedule of the proposed sources and uses of funds for such transaction.

 

“Borrower” has the meaning specified in the recital of parties to this Agreement.

 

“Borrower’s Account” means the account of the Borrower maintained by the Borrower with Wells Fargo Bank, N.A, at its office at 420 Montgomery Street, San Francisco, CA 94104, ABA No. 121000248, Account No. 4100135359, Account Name:  Five Star Quality Care Inc., or such other account as the Borrower shall specify in writing to the Administrative Agent.

 

“Borrowing” means a borrowing consisting of simultaneous Revolving Credit Advances of the same Type made by the Lenders or a Swing Line Borrowing.

 

“Borrowing Base Assets” means, unless and until such Healthcare Assets have been designated non-Borrowing Base Assets pursuant to Section 5.02(e)(iii), (a) those Healthcare Assets for which the applicable conditions (as may be determined by the Administrative Agent in its sole discretion) in Section 3.01 and, if applicable, Section 5.01(k) have been satisfied and as the Administrative Agent and the Required Lenders, in their sole discretion, shall have elected to treat as Borrowing Base Assets for purposes of this Agreement, and (b) the Healthcare Assets listed on Schedule II hereto, including Pending Borrowing Base Assets; provided, however, that each Pending Borrowing Base Asset shall cease to be a Borrowing Base Asset in the event that the Collateral Deliverables relating to such Pending Borrowing Base Asset is not received by Administrative Agent by May 24, 2017.

 

“Borrowing Base Certificate” means a certificate in substantially the form of Exhibit H hereto, duly certified by the Chief Financial Officer (or other Responsible Officer performing similar functions) of the Borrower.

 

“Borrowing Base Conditions” means, with respect to any Borrowing Base Asset or Proposed Borrowing Base Asset, that such Borrowing Base Asset or Proposed Borrowing Base Asset (a) is a Healthcare Asset located in one of the 48 contiguous states of the United States of America or the District of Columbia; (b) is wholly-owned directly or indirectly by the Borrower either in fee simple absolute or subject to a Qualifying Ground Lease; (c) is fully operating, properly licensed, in compliance with all applicable Healthcare Requirements, and not under significant development or redevelopment; (d) is free of all material structural defects or architectural deficiencies, title defects, environmental or other material matters (including a casualty event or condemnation) that could reasonably be expected to have a material adverse effect on the value, use or ability to sell or refinance such Asset; (e) is operated by an Approved Manager or any other property manager approved by the Administrative Agent; (f) is not subject to mezzanine Debt financing; (g) is not, and no interest of the Borrower or any of its Subsidiaries therein is, subject to any Lien (other than Permitted Liens) or any Negative Pledge; and (h) is 100% owned by a single-purpose entity that is a direct or indirect Subsidiary of the Borrower; provided that FVE EC LLC may own the Transfer Healthcare Asset known as New Seasons at Voorhees, located at 501 Laurel Oak Road, Voorhees, NJ 08043, and/or hold the applicable Healthcare License with respect to such Transfer Healthcare Asset for a period of no longer than 180 days following the Closing Date; provided further that any leases to which FVE EC LLC is a party with respect to such Transfer Healthcare Assets shall be terminated on or prior to

 

5

 

the last day of such 180 day period; provided still further that neither FVE MW LLC nor FVE EC LLC shall incur any mezzanine or mortgage debt with respect to the Transfer Healthcare Assets and (1) none of the Borrower’s direct or indirect Equity Interests in such Subsidiary is subject to any Lien (other than Permitted Liens) or any Negative Pledge and (2)(x) on or prior to the date such Asset is added to the Collateral, such Subsidiary shall have become a Guarantor hereunder, and (y) the Borrower directly, or indirectly through a Subsidiary, has the right to take the following actions without the need to obtain the consent of any Person:  (i) to create Liens on such Asset and on the Equity Interests in such Subsidiary as security for Debt of the Borrower or such Subsidiary, as applicable, and (ii) to sell, transfer or otherwise dispose of such Asset.

 

“Borrowing Base Debt Service Coverage Ratio” means, at any date of determination, the ratio of (a) the aggregate Adjusted Net Operating Income for all Borrowing Base Assets to (b) the annual debt service payments that would have been required to be made for the same consecutive four fiscal quarter period on an assumed Debt in an aggregate principal amount equal to the Facility Exposure applying a 30-year amortization schedule with a coupon equal to the greatest of (x) the one-month Eurodollar Rate plus 2.50% per annum, (y) the rate per annum on 10 year United States Treasury Securities plus 2.50% per annum, or (z) 7.50% per annum.

 

“Borrowing Base Value” means, with respect to any Borrowing Base Asset, an amount equal to 65% of the Asset Value of such Borrowing Base Asset.

 

“Building” means a building or structure with at least two walls and a roof or any such building or structure in the course of construction.

 

“Business Day” means a day of the year on which banks are not required or authorized by law to close in New York City and, if the applicable Business Day relates to any Eurodollar Rate Advances, on which dealings are carried on in the London interbank market.

 

“Capital Expenditure Reserve” means, with respect to any owned Asset at any date of determination, $350.00 times the total number of units comprising such Asset.

 

“Capitalized Leases” means all leases that have been or should be, in accordance with GAAP, recorded as capitalized leases.

 

“Cash Collateral Account” means the interest-bearing account of the Borrower maintained with the Collateral Agent, in each case in the name of the Collateral Agent and under the sole control and dominion of the Collateral Agent and subject to terms of this Agreement.

 

“Cash Collateralize” means, in respect of an Obligation, to provide and pledge (as a first priority perfected security interest) cash collateral in U.S. Dollars, at a location and pursuant to documentation in form and substance satisfactory to the Administrative Agent, the Issuing Bank and the Swing Line Bank (and “Cash Collateralization” has a corresponding meaning).

 

“Cash Equivalents” means, as to any Person, (a) securities issued, or directly, unconditionally and fully guaranteed or insured, by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than one year from the date of acquisition by such Person, (b) time deposits and certificates of deposit of any Lender or any commercial bank having, or which is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any state thereof or the District of Columbia having, capital and surplus aggregating in excess of $500,000,000 and a rating of “A” (or such other similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act) with maturities of not more than one year from the date of acquisition by such Person, (c) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (a) above entered into with any Person meeting the qualifications specified in clause (b) above,

 

6

 

which repurchase obligations are secured by a valid perfected security interest in the underlying securities, (d) commercial paper issued by any Person incorporated in the United States rated at least A 1 or the equivalent thereof by Standard & Poor’s Rating Service or at least P 1 or the equivalent thereof by Moody’s Investors Service Inc., and in each case maturing not more than one year after the date of acquisition by such Person, and (e) investments in money market funds at least 95% of whose assets are comprised of securities of the types described in clauses (a) through (d) above.

 

“CERCLA” means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended from time to time.

 

“CERCLIS” means the Comprehensive Environmental Response, Compensation and Liability Information System maintained by the U.S. Environmental Protection Agency.

 

“CGMI” has the meaning specified in the recital of parties to this Agreement.

 

“Change of Control” means the occurrence of any of the following:  (a) any Person or two or more Persons acting in concert shall have acquired and shall continue to have following the date hereof beneficial ownership (within the meaning of Rule 13d-3 of the Securities and Exchange Commission under the Securities Exchange Act), directly or indirectly, of Voting Interests of the Borrower or any Guarantor (or other securities convertible into such Voting Interests) representing 35% or more of the combined voting power of all Voting Interests of the Borrower or such Guarantor; provided, however, that this clause (a) shall not include the acquisition by the ABP Stockholders (or any of them) of up to an aggregate of 50% of the combined voting power of all such Voting Interests (such acquisition being an “ABP Transaction”); or (b) there is a change in the composition of the Borrower’s Board of Directors over a period of 24 consecutive months (or less) such that a majority of Board members (rounded up to the nearest whole number) ceases to be comprised of individuals who either (i) have been Board members continuously since the beginning of such period or (ii) have been elected or nominated for election as Board members during such period by at least a majority of the Board members described in clause (i) who were still in office at the time such election or nomination was approved by the Board; or (c) any Person or two or more Persons acting in concert (other than as a result of an ABP Transaction) shall have acquired and shall continue to have following the date hereof, by contract or otherwise, or shall have entered into a contract or arrangement that, upon consummation will result in its or their acquisition of the power to direct, directly or indirectly, the management or policies of the Borrower or any Guarantor; or (d) the Borrower ceases to be the direct or indirect legal and beneficial owner of all of the Equity Interests in each direct and indirect Subsidiary that owns or leases a Borrowing Base Asset.

 

“Citibank” has the meaning specified in the recital of parties to this Agreement.

 

“Civil Monetary Penalty Law” has the meaning specified in Section 4.01(y).

 

“Closing Date” means February 24, 2017.

 

“Collateral” means all “Collateral” and all “Mortgaged Property” referred to in the Collateral Documents and all other property that is or is intended to be subject to any Lien in favor of the Collateral Agent for the benefit of the Secured Parties and includes, without limitation, all Borrowing Base Assets.

 

“Collateral Agent” has the meaning specified in the recital of parties to this Agreement.

 

“Collateral Deliverables” means, with respect to any Proposed Borrowing Base Asset, the following items, each in form and substance satisfactory to the Administrative Agent (unless otherwise specified):

 

7

 

(i)                                     A certificate of the Chief Financial Officer (or other Responsible Officer) of the Borrower, dated the date of the addition of such Proposed Borrowing Base Asset to the Collateral as a Borrowing Base Asset, confirming that (A) the Proposed Borrowing Base Asset satisfies all Borrowing Base Conditions, (B) no Default or Event of Default has occurred or is continuing, and the addition of such Proposed Borrowing Base Asset as a Borrowing Base Asset shall not cause or result in a Default or Event of Default, (C) the representations and warranties contained in the Loan Documents are true and correct on and as of such date, (D) the Loan Parties are in compliance with the covenants contained in Section 5.04 (both immediately before and on a pro forma basis immediately after the addition of such Proposed Borrowing Base Property as a Borrowing Base Asset), together with supporting information demonstrating such compliance; and (E) on the date of the addition of such Proposed Borrowing Base Asset to the Collateral as a Borrowing Base Asset the Borrowing Base Debt Service Coverage Ratio (adjusted on a pro forma basis to include such Proposed Borrowing Base Asset) shall not be less than 1.50:1.00, together with supporting information demonstrating such compliance;

 

(ii)                                  A Borrowing Base Certificate demonstrating that the Facility Available Amount (calculated on a pro forma basis after giving effect to the addition of such Proposed Borrowing Base Asset to the Collateral as a Borrowing Base Asset and to any Advances made at the time thereof) will be greater than or equal to the Facility Exposure;

 

(iii)                               Each of the items set forth in Sections 3.01(a)(ii), (iii), (xi), (xii), (xiii), (xiv) and (xvii) and, to the extent applicable, 5.01(j)(i), mutatis mutandis, in each case in respect of such Proposed Borrowing Base Asset;

 

(iv)                              An Appraisal of such Proposed Borrowing Base Asset;

 

(v)                                 Reports supplementing Schedule II hereto and Schedules 4.01(b), 4.01(q) Part III and 4.01(r) to the Disclosure Letter, including descriptions of such changes in the information included in such Schedules as may be necessary for such Schedules to be accurate and complete, certified as correct and complete by a Responsible Officer of the Borrower, provided that for purposes of the definition of the term Borrowing Base Assets, the supplement to Schedule II hereto shall become effective only upon (A) delivery of all Collateral Deliverables and approval thereof by the Administrative Agent, and (B) approval of the Proposed Borrowing Base Asset as a Borrowing Base Asset pursuant to the definition of “Borrowing Base Assets”;

 

(vi)                              Copies of all necessary Healthcare Licenses for such Proposed Borrowing Base Asset;

 

(vii)                           All Healthcare Deliverables for such Proposed Borrowing Base Asset (provided, however, that this requirement shall not apply to those Borrowing Base Assets listed on Schedule II hereto as of the Closing Date); and

 

(viii)                        Such other approvals, opinions or documents as any Lender Party through the Administrative Agent may reasonably request.

 

“Collateral Documents” means the Security Agreement, the Mortgages and any other agreement entered into by a Loan Party that creates or purports to create a Lien in favor of the Collateral Agent for the benefit of the Secured Parties.

 

“Commitment” means a Revolving Credit Commitment, a Swing Line Commitment or a Letter of Credit Commitment.

 

“Commitment Date” has the meaning specified in Section 2.19(b).

 

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“Commitment Increase” has the meaning specified in Section 2.19(a).

 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

 

“Communications” means each notice, demand, communication, information, document and other material provided for hereunder or under any other Loan Document or otherwise transmitted between the parties hereto relating this Agreement, the other Loan Documents, any Loan Party or its Affiliates, or the transactions contemplated by this Agreement or the other Loan Documents including, without limitation, all Approved Electronic Communications.

 

“Compliance Certificate” means a certificate in substantially the form of Exhibit J hereto, duly certified by the Chief Financial Officer (or other Responsible Officer performing similar functions) of the Borrower.

 

“Conditional Approval Notice” has the meaning specified in Section 5.01(k).

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

 

“Consent Request Date” has the meaning specified in Section 9.01(b).

 

“Consolidated” refers to the consolidation of accounts in accordance with GAAP.

 

“Contingent Obligation” means, with respect to any Person, any Obligation or arrangement of such Person to guarantee or intended to guarantee any Debt, leases, dividends or other payment Obligations (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, (a) the direct or indirect guarantee, endorsement (other than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the Obligation of a primary obligor, (b) the Obligation to make take-or-pay or similar payments, if required, regardless of nonperformance by any other party or parties to an agreement or (c) any Obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (A) for the purchase or payment of any such primary obligation or (B) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, assets, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof.  The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made (or, if less, the maximum amount of such primary obligation for which such Person may be liable pursuant to the terms of the instrument evidencing such Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder), as determined by such Person in good faith.

 

“Conversion”, “Convert” and “Converted” each refer to a conversion of Advances of one Type into Advances of the other Type pursuant to Section 2.07(d), 2.09 or 2.10.

 

“Customary Carve-Out Agreement” has the meaning specified in the definition of Non-Recourse Debt.

 

“Debt” of any Person means, without duplication for purposes of calculating financial ratios, (a) all Debt for Borrowed Money of such Person, (b) all Obligations of such Person for the deferred purchase price of property or services other than trade payables incurred in the ordinary course of

 

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business and not overdue by more than 60 days, (c) all Obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all Obligations of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all Obligations of such Person as lessee under Capitalized Leases, (f) all Obligations of such Person under acceptance, letter of credit or similar facilities, (g) all Obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interests in such Person or any other Person (other than Preferred Interests that are issued by any Loan Party or Subsidiary thereof and classified as either equity or minority interests pursuant to GAAP) or any warrants, rights or options to acquire such Equity Interests, (h) all Obligations of such Person in respect of Hedge Agreements, valued at the Agreement Value thereof, (i) all Contingent Obligations of such Person and (j) all indebtedness and other payment Obligations referred to in clauses (a) through (i) above of another Person secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Lien on property (including, without limitation, accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such indebtedness or other payment Obligations (valued, in the case of any such Debt as to which recourse for the payment thereof is expressly limited to the property or assets on which such Lien is granted, at the lesser of (1) the stated or determinable amount of the Debt that is so secured or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) and (2) the fair market value of such property or assets); provided, however, that in the case of the Borrower and its Subsidiaries, “Debt” shall also include, without duplication, the JV Pro Rata Share of Debt for each Joint Venture.

 

“Debt for Borrowed Money” of any Person means all items that, in accordance with GAAP, would be classified as indebtedness on a Consolidated balance sheet of such Person; provided, however, that in the case of the Borrower and its Subsidiaries “Debt for Borrowed Money” shall also include, without duplication, the JV Pro Rata Share of Debt for Borrowed Money for each Joint Venture; provided further that as used in the definition of “Fixed Charge Coverage Ratio”, in the case of any acquisition or disposition of any direct or indirect interest in any Asset (including through the acquisition or disposition of Equity Interests) by the Borrower or any of its Subsidiaries during the consecutive four fiscal quarters of the Borrower most recently ended for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be, the term “Debt for Borrowed Money” (a) shall include, in the case of an acquisition, any Debt for Borrowed Money directly relating to such Asset existing immediately following such acquisition computed as if such indebtedness also existed for the portion of such period that such Asset was not owned by the Borrower or such Subsidiary, and (b) shall exclude, in the case of a disposition, for such period any Debt for Borrowed Money to which such Asset was subject to the extent such Debt for Borrowed Money was repaid or otherwise terminated upon the disposition of such Asset.

 

“Default” means any Event of Default or any event that would constitute an Event of Default but for the requirement that notice be given or time elapse or both.

 

“Defaulting Lender” means at any time, subject to Section 2.17(f), (i) any Lender that has failed for two or more Business Days to comply with its obligations under this Agreement to make an Advance, make a payment to the Issuing Bank in respect of a Letter of Credit Advance, make a payment to the Swing Line Bank in respect of a Swing Line Advance or make any other payment due hereunder (each, a “funding obligation”), unless such Lender has notified the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding has not been satisfied (which conditions precedent, together with the applicable default, if any, will be specifically identified in such writing), (ii) any Lender that has notified the Administrative Agent, the Borrower, the Issuing Bank or the Swing Line Bank in writing, or has stated publicly, that it does not intend to comply with its funding obligations hereunder, unless such writing or statement states that such position is based on such Lender’s determination that

 

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one or more conditions precedent to funding cannot be satisfied (which conditions precedent, together with the applicable default, if any, will be specifically identified in such writing or public statement), (iii) any Lender that has, for three or more Business Days after written request of the Administrative Agent or the Borrower, failed to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender will cease to be a Defaulting Lender pursuant to this clause (iii) upon the Administrative Agent’s and the Borrower’s receipt of such written confirmation), or (iv) any Lender with respect to which a Lender Insolvency Event has occurred and is continuing with respect to such Lender or its Parent Company, provided that in each case, neither the reallocation of funding obligations provided for in Section 2.17(b) as a result of a Lender’s being a Defaulting Lender nor the performance by Non-Defaulting Lenders of such reallocated funding obligations will by themselves cause the relevant Defaulting Lender to become a Non-Defaulting Lender.  Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any of clauses (i) through (iv) above will be conclusive and binding absent demonstrable error, and such Lender will be deemed to be a Defaulting Lender (subject to Section 2.17(f)) upon notification of such determination by the Administrative Agent to the Borrower, the Issuing Bank, the Swing Line Bank and the Lenders.

 

“Departing Lender” has the meaning specified in Section 2.18.

 

“Development Assets” means all Real Property acquired for development into Healthcare Assets that, in accordance with GAAP, would be classified as development property on a Consolidated balance sheet of the Borrower and its Subsidiaries.

 

“Disclosure Letter” means that certain Disclosure Letter, dated as of the date hereof, executed by the Loan Parties.

 

“Dollars” and the “$” each means lawful currency of the United States of America.

 

“Domestic Lending Office” means, with respect to any Lender Party, the office of such Lender Party specified as its “Domestic Lending Office” opposite its name on Schedule I hereto or in the Assignment and Acceptance pursuant to which it became a Lender Party, as the case may be, or such other office of such Lender Party as such Lender Party may from time to time specify to the Borrower and the Administrative Agent.

 

“EBITDA” means, at any date of determination, the sum of the following items, in each for the four consecutive fiscal quarters of the Borrower most recently ended for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be:  (a) net income (or loss) for such period determined for the Borrower and its Subsidiaries on a consolidated basis, in accordance with GAAP, exclusive of the following (but only to the extent included in the determination of such net income (or loss) for such period):  (i) depreciation and amortization expense, (ii) interest expense, (iii) income tax expense, (iv) extraordinary or non-recurring gains and losses, and (v) transaction costs of acquisitions not permitted to be capitalized pursuant to GAAP, plus (b) with respect to each Joint Venture, the JV Pro Rata Share of the sum of:  (a) net income (or loss) for such period determined on a consolidated basis, in accordance with GAAP, exclusive of the following (but only to the extent included in the determination of such net income (or loss) for such period):  (i) depreciation and amortization expense, (ii) interest expense, (iii) income tax expense, (iv) extraordinary or non-recurring gains and losses, and (v) transaction costs of acquisitions not permitted to be capitalized pursuant to GAAP; provided, however, that for purposes of this definition, in the case of any acquisition or disposition of any direct or indirect interest in any Asset (including through the acquisition or disposition of Equity Interests) by the Borrower or any of its Subsidiaries during such four fiscal quarter period, EBITDA will be adjusted (1) in the case of an acquisition, by adding thereto an amount equal to the acquired Asset’s actual EBITDA (computed as if such Asset was owned by the Borrower or one of its Subsidiaries for the entire four fiscal quarter period) generated during the portion of such four fiscal quarter period that such Asset was not owned

 

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by the Borrower or such Subsidiary, and (2) in the case of a disposition, by subtracting therefrom an amount equal to the actual EBITDA generated by the Asset so disposed of during such four fiscal quarter period.

 

“ECP” means an eligible contract participant as defined in the Commodity Exchange Act.

 

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

 

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

“Effective Date” means the first date on which the conditions set forth in Article III shall be satisfied.

 

“Eligible Assignee” means (a) with respect to the Revolving Credit Facility, (i) a Lender; (ii) an Affiliate or Fund Affiliate of a Lender; or (iii) any other Person approved by the Administrative Agent, and, unless a Default has occurred and is continuing at the time any assignment is effected pursuant to Section 9.07, approved by the Borrower, each such approval not to be unreasonably withheld or delayed, and (b) with respect to the Letter of Credit Facility, a Person that is approved by the Administrative Agent and, unless a Default has occurred and is continuing at the time any assignment is effected pursuant to Section 9.07, approved by the Borrower, each such approval not to be unreasonably withheld or delayed; provided, however, that in no circumstances shall any Loan Party, any Affiliate of a Loan Party, any natural person or any Defaulting Lender qualify as an Eligible Assignee under this definition absent the prior consent of all Lenders (other than Defaulting Lenders).

 

“Environmental Action” means any enforcement action, suit, demand, demand letter, claim of liability, notice of non-compliance or violation, notice of liability or potential liability, investigation, enforcement proceeding, consent order or consent agreement relating in any way to any Environmental Law, any Environmental Permit or Hazardous Material or arising from alleged injury or threat to health or safety from exposure to Hazardous Materials or to the environment, including, without limitation, (a) by any governmental or regulatory authority for enforcement, cleanup, removal, response, remedial or other actions or damages and (b) by any governmental or regulatory authority or third party for damages, contribution, indemnification, cost recovery, compensation or injunctive relief.

 

“Environmental Law” means any Federal, state, local or foreign statute, law, ordinance, rule, regulation, code, order, writ, judgment, injunction, decree or judicial or agency interpretation relating to pollution or protection of the environment, or natural resources, including, without limitation, those relating to the use, handling, transportation, treatment, storage, disposal, release or discharge of Hazardous Materials.

 

“Environmental Permit” means any permit, approval, identification number, license or other authorization required under any Environmental Law.

 

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“Equity Interests” means, with respect to any Person, shares of capital stock of (or other ownership or profit interests in) such Person, warrants, options or other rights for the purchase or other acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, 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 other acquisition from such Person of such shares (or such other interests), and other ownership or profit interests in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are authorized or otherwise existing on any date of determination.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

 

“ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a member of the controlled group of any Loan Party, or under common control with any Loan Party, within the meaning of Section 414 of the Internal Revenue Code.

 

“ERISA Event” means (a)(i) the occurrence of a reportable event, within the meaning of Section 4043 of ERISA, with respect to any Plan unless the 30-day notice requirement with respect to such event has been waived by the PBGC or (ii) the requirements of  Section 4043(b) of ERISA apply with respect to a contributing sponsor, as defined in Section 4001 (a)(13) of ERISA, of a Plan, and an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect to such Plan within the following 30 days; (b) the application for a minimum funding waiver with respect to a Plan; (c) the provision by the administrator of any Plan of a notice of intent to terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation of operations at a facility of any Loan Party or any ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e) the withdrawal by any Loan Party or any ERISA Affiliate from a Multiple Employer Plan during a plan year for which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a lien under Section 302(f) of ERISA shall have been met with respect to any Plan; (g) the adoption of an amendment to a Plan requiring the provision of security to such Plan pursuant to Section 307 of ERISA; or (h) the institution by the PBGC of proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the occurrence of any event or condition described in Section 4042 of ERISA that constitutes grounds for the termination of, or the appointment of a trustee to administer, such Plan.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

 

“Eurocurrency Liabilities” has the meaning specified in Regulation D of the Board of Governors of the Federal Reserve System, as in effect from time to time.

 

“Eurodollar Lending Office” means, with respect to any Lender Party, the office of such Lender Party specified as its “Eurodollar Lending Office” opposite its name on Schedule I hereto or in the Assignment and Acceptance pursuant to which it became a Lender Party (or, if no such office is specified, its Domestic Lending Office), or such other office of such Lender Party as such Lender Party may from time to time specify to the Borrower and the Administrative Agent.

 

“Eurodollar Rate” means, for any Interest Period for all Eurodollar Rate Advances comprising part of the same Borrowing, an interest rate per annum equal to the rate per annum obtained by dividing (a) the Screen Rate determined as of approximately 11:00 A.M. (London time) two Business Days prior to the first day of such Interest Period by (b) a percentage equal to 100% minus the Eurodollar Rate Reserve Percentage for such Interest Period, or, if for any reason the Screen Rate is not available at such time, then the “Eurodollar Rate” for such Interest Period shall be the rate

 

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per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Advance being made, continued or converted by Citibank and with a term equivalent to such Interest Period would be offered by Citibank’s London Branch (or other Citibank branch or Affiliate) to major banks in the London or other offshore interbank market for Dollars at their request at approximately 11:00 A.M. (London time) two Business Days prior to the commencement of such Interest Period; provided, however, that in no circumstance shall the Eurodollar Rate be less than 0% per annum.  For purposes of determining the Base Rate, the one-month Eurodollar Rate shall be calculated as set forth in this paragraph utilizing the Screen Rate for a one-month period determined as of approximately 11:00 A.M. (London time) on the applicable date of determination (or on the previous Business Day if such date of determination is not a Business Day).

 

“Eurodollar Rate Advance” means an Advance that bears interest as provided in Section 2.07(a)(ii).

 

“Eurodollar Rate Reserve Percentage” means, for any Interest Period for all Eurodollar Rate Advances comprising part of the same Borrowing, the reserve percentage applicable two Business Days before the first day of such Interest Period under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for a member bank of the Federal Reserve System in New York City with respect to liabilities or assets consisting of or including Eurocurrency Liabilities (or with respect to any other category of liabilities that includes deposits by reference to which the interest rate on Eurodollar Rate Advances is determined) having a term equal to such Interest Period.

 

“Events of Default” has the meaning specified in Section 6.01.

 

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act at the time the Guaranty of such Guarantor or the grant of such security interest becomes effective with respect to such related Swap Obligation.  If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or security interest is or becomes illegal.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its Applicable Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in an Advance or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Advance or Commitment (other than pursuant to an assignment request by the Borrower under Section 2.18 or Section 9.01(b)) or (ii) such Lender changes its lending office except in each case to the extent that, pursuant to Section 2.12, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with

 

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Section 2.12(f) and Section 2.12(g) and (d) any U.S. federal withholding Taxes imposed under FATCA.

 

“Existing Agreement” has the meaning specified in the recitals to this Agreement.

 

“Existing Borrowing Base Assets” means those Healthcare Assets identified on Schedule II hereto as “Existing Borrowing Base Assets”.

 

“Existing Debt” means Debt of each Loan Party and its Subsidiaries outstanding immediately before the Effective Date.

 

“Existing Issuing Bank” means Citibank.

 

“Extension Fee” has the meaning specified in Section 2.08(d).

 

“Facility” means the Revolving Credit Facility, the Swing Line Facility or the Letter of Credit Facility.

 

“Facility Assigned Rights and Obligations” has the meaning specified in Section 2.20(a).

 

“Facility Available Amount” means, at any date of determination, the maximum total amount available under the Facility, which shall at all times be the least of (i) the total Revolving Credit Commitments on such date, (ii) the Total Borrowing Base Value, (iii) an amount that would result in a Borrowing Base Debt Service Coverage Ratio equal to 1.50 to 1.00 and (iv) the aggregate amount of title insurance under the then-existing Mortgage Policies with respect to the then-existing Borrowing Base Assets.

 

“Facility Exposure” means, at any time, the sum of (a) the aggregate principal amount of all outstanding Advances, plus (b) the amount (not less than zero) equal to the Available Amount under all outstanding Letters of Credit less all amounts then on deposit in the L/C Cash Collateral Account.

 

“Facility Purchasing Bank” has the meaning specified in Section 2.20(a).

 

“Facility Selling Bank” has the meaning specified in Section 2.20(a).

 

“False Claims Act” has the meaning specified in Section 4.01(y).

 

“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretation or application thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Internal Revenue Code.

 

“Federal Funds Rate” means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, an analogous rate determined by the Administrative Agent with reference to another commercially available source or sources designated by the Administrative Agent; provided, however, that in no circumstance shall the Federal Funds Rate be less than 0% per annum.

 

“Fee Letter” means any separate letter agreement executed and delivered by the Borrower and to which the Administrative Agent is a party, as the same may be amended from time to time.

 

“FEMA” means the Federal Emergency Management Agency.

 

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“First Extension Date” has the meaning specified in Section 2.16.

 

“Fiscal Year” means a fiscal year of the Borrower and its Consolidated Subsidiaries ending on December 31 in any calendar year.

 

“Fixed Charge Coverage Ratio” means, at any date of determination, the ratio of (a) Adjusted EBITDA to (b) the sum of (i) interest (including capitalized interest) payable on, all Debt for Borrowed Money plus (ii) principal amounts of all Debt for Borrowed Money payable (excluding maturities) plus (iii) cash dividends payable on any Preferred Interests, in each case, of or by the Borrower and its Subsidiaries for the consecutive four fiscal quarters of the Borrower most recently ended for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be.

 

“Flood Compliance Event” means the occurrence of any of the following:  (a) a Flood Redesignation with respect to any Borrowing Base Asset, (b) any extension of the Termination Date pursuant to Section 2.16, (c) any Commitment Increase pursuant to Section 2.19, and (d) the addition of any Flood Hazard Property as Collateral pursuant to Section 5.01 (k).

 

“Flood Hazard Determination” means a “Life-of-Loan” FEMA Standard Flood Hazard Determination obtained by the Administrative Agent.

 

“Flood Hazard Property” means any Borrowing Base Asset that on the relevant date of determination includes a Building and, as shown on a Flood Hazard Determination, such Building is located in a Special Flood Hazard Area.

 

“Flood Insurance” means (a) federally-backed flood insurance available under the National Flood Insurance Program to owners of real property improvements located in Special Flood Hazard Areas in a community participating in the National Flood Insurance Program or (b) to the extent permitted by the Flood Laws, a private flood insurance policy from a financially sound and reputable insurance company that is not an Affiliate of the Borrower.

 

“Flood Insurance Documents” means (a) evidence as to whether each Borrowing Base Asset is a Flood Hazard Property pursuant to a Flood Hazard Determination, and (b) if such Borrowing Base Asset is a Flood Hazard Property, (i) evidence as to whether the community in which such Borrowing Base Asset is located is participating in the National Flood Insurance Program, (ii) the applicable Guarantor’s written acknowledgment of receipt of written notification from the Administrative Agent as to the fact that such Borrowing Base Asset is a Flood Hazard Property and as to whether the community in which each such Flood Hazard Property is located is participating in the National Flood Insurance Program and (iii) copies of the applicable Guarantor’s application for a Flood Insurance policy plus proof of premium payment, a declaration page confirming that Flood Insurance has been issued, or such other evidence of Flood Insurance, in an amount equal to at least the amount required by the Flood Laws and naming the Collateral Agent as sole loss payee and mortgagee on behalf of the Secured Parties, and otherwise including terms satisfactory to the Collateral Agent.

 

“Flood Laws” means the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973, as revised by the National Flood Insurance Reform Act of 1994, and as the same may be further amended, modified or supplemented, and including the regulations issued thereunder.

 

“Flood Redesignation” means the designation of any Borrowing Base Asset as a Flood Hazard Property where such property was not a Flood Hazard Property previous to such designation.

 

“Foreign Lender Party” has the meaning specified in Section 2.12(g)(ii).

 

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“Fund Affiliate” means, with respect to any Lender that is a fund that invests in bank loans, any other fund that invests in bank loans and is advised or managed by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

 

“GAAP” has the meaning specified in Section 1.03.

 

“Good Faith Contest” means the contest of an item as to which:  (a) such item is contested in good faith, by appropriate proceedings, (b) reserves that are adequate are established with respect to such contested item in accordance with GAAP and (c) the failure to pay or comply with such contested item during the period of such contest could not reasonably be expected to result in a Material Adverse Effect.

 

“Governmental Authority” means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any Federal, state, municipal, national, local or other governmental department, agency, authority, commission, instrumentality, board, bureau, regulatory body, contractor, intermediary, carrier, court, central bank or other entity or officer 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).

 

“Group Purchasing Organization” or “GPO” means any Subsidiary of the Borrower that provides purchasing for the long-term care industry or other institutional providers.

 

“Guaranteed Obligations” has the meaning specified in Section 7.01.

 

“Guarantor Deliverables” means each of the items set forth in Section 5.01(j).

 

“Guarantors” has the meaning specified in the recital of parties to this Agreement.

 

“Guaranty” means the Guaranty by the Guarantors pursuant to Article VII, together with any and all Guaranty Supplements required to be delivered pursuant to Section 5.01(j) or Section 7.05.

 

“Guaranty Supplement” means a supplement entered into by an Additional Guarantor in substantially the form of Exhibit C hereto.

 

“Hazardous Materials” means (a) petroleum or petroleum products, by-products or breakdown products, radioactive materials, asbestos-containing materials, polychlorinated biphenyls, radon gas and mold and (b) any other chemicals, materials or substances designated, classified or regulated as hazardous or toxic or as a pollutant or contaminant under any Environmental Law.

 

“Healthcare Asset” means any facility (including, without limitation, each skilled nursing facility, assisted living facility, memory care or independent living facility) which provides independent living or any level of geriatric care, nursing care, home care, medical care (including sub-acute care), assisted living, rehabilitative services or assistance with activities of daily living, whether or not licensed as a skilled-nursing facility, intermediate care facility, assisted living facility, personal care facility, outpatient clinic or hospital (including any long term acute care hospital), owned by the Borrower or any of its Subsidiaries.

 

“Healthcare Deliverables” means copies of the following, in each case provided at such time as to permit the Lenders’ reasonable review with respect to any Borrowing Base Asset or Proposed Borrowing Base Asset, and which content and/or matters disclosed therein are reasonably acceptable to Lenders:  (a) all investigations, surveys, subpoenas, proceedings or audit reports pertaining to Healthcare Licenses, Healthcare Assets and Healthcare Services for the past year and any related correspondence and responses thereto (not including any materials protected by attorney-client privilege or constituting attorney-client work product); and (b) settlement agreements, consent

 

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agreements, consent orders, corporate integrity agreements or certification of compliance agreements currently in effect and entered into with any Governmental Authority.

 

“Healthcare Licenses” means all certificates of need (or similar documents, including but not limited to certificates of completion), certifications, licenses, permits, accreditations, reimbursement approvals, regulatory agreements, participation agreements or other material agreements, state skilled-nursing facility or assisted-living facility licenses, and any other license, permit, agreement, approval or requirement required by a Governmental Authority for the establishment, construction, ownership, operation, use, management of a Healthcare Asset or any part thereof or for the provision of services by each Healthcare Service.

 

“Healthcare Requirements” means each Federal, state, local or foreign statute, law, ordinance, rule, regulation, code, order, writ, judgment, injunction, decree, procedure, plan, reimbursement requirement, provider manual, or judicial or agency interpretation, policy or guidance pertaining to or concerned with:  (a) the establishment, construction, ownership, operation, use, management or occupancy of a Healthcare Asset or any part thereof as a skilled-nursing facility, assisted-living facility or other facility or provider type; and (b) the provision of services therein.

 

“Healthcare Service” means any service that may be paid for by Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor arrangement, plan or program, including, without limitation, nursing care, hospice, home health care, speech therapy, occupational therapy, and physical therapy services, and that is furnished by the Borrower or any of its Subsidiaries.

 

“Healthcare Staffing Company” means any Subsidiary of the Borrower that provides staffing and/or recruitment services for healthcare providers, including, without limitation, placement of nurses and physical, occupational and/or speech therapists.

 

“Hedge Agreements” means interest rate swap, cap or collar agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts and other hedging agreements.

 

“HHS” has the meaning specified in Section 4.01(y)(viii).

 

“HIPAA” means the administrative simplification provisions of the Health Insurance Portability and Accountability Act of 1996, Public Law 104-191, and the regulations promulgated thereunder, and as amended by the Health Information Technology for Economic and Clinical Health Act provisions of the American Recovery and Reinvestment Act of 2009, Public Law 111-005, and the regulations promulgated thereunder.

 

“ICC” has the meaning specified in Section 2.03(f).

 

“ICC Rule” has the meaning specified in Section 2.03(f).

 

“ICE LIBOR” has the meaning specified in the definition of “Screen Rate”.

 

“Increase Date” has the meaning specified in Section 2.19(a).

 

“Increasing Lender” has the meaning specified in Section 2.19(b).

 

“Indemnified Costs” has the meaning specified in Section 8.05(a).

 

“Indemnified Party” has the meaning specified in Section 7.06(a).

 

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“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any Obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

 

“Information” has the meaning specified in Section 9.12.

 

“Information Memorandum” means the information memorandum dated January 19, 2017 used by the Arrangers in connection with the syndication of the Commitments.

 

“Initial Extension of Credit” means the first to occur of the initial Borrowing and the initial issuance of a Letter of Credit hereunder.

 

“Initial Issuing Bank” has the meaning specified in the recital of parties to this Agreement.

 

“Initial Lenders” has the meaning specified in the recital of parties to this Agreement.

 

“Insufficiency” means, with respect to any Plan, the amount, if any, of its unfunded benefit liabilities, as defined in Section 4001(a)(18) of ERISA.

 

“Interest Period” means, for each Eurodollar Rate Advance comprising part of the same Borrowing, the period commencing on the date of such Eurodollar Rate Advance or the date of the Conversion of any Base Rate Advance into such Eurodollar Rate Advance, and ending on the last day of the period selected by the Borrower pursuant to the provisions below and, thereafter, each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the last day of the period selected by the Borrower pursuant to the provisions below.  The duration of each such Interest Period shall be seven days, one, two, three or six months (or twelve months if available from all Lenders), as the Borrower may, upon notice received by the Administrative Agent not later than 12:00 Noon (New York City time) on the third Business Day prior to the first day of such Interest Period, select; provided, however, that:

 

(a)                                 the Borrower may not select any Interest Period with respect to any Eurodollar Rate Advance that ends after the Termination Date;

 

(b)                                 Interest Periods commencing on the same date for Eurodollar Rate Advances comprising part of the same Borrowing shall be of the same duration;

 

(c)                                  whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day; provided, however, that if such extension would cause the last day of such Interest Period to occur in the next following calendar month, the last day of such Interest Period shall occur on the next preceding Business Day; and

 

(d)                                 whenever the first day of any Interest Period occurs on a day of an initial calendar month for which there is no numerically corresponding day in the calendar month that succeeds such initial calendar month by the number of months equal to the number of months in such Interest Period, such Interest Period shall end on the last Business Day of such succeeding calendar month.

 

“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

 

“Interpolated Rate” means, for the relevant Interest Period, the rate per annum (rounded upward, if necessary, to the nearest 1/100 of 1%) which results from interpolating on a linear basis between:

 

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(a)                                 the applicable Published Screen Rate for the longest period (for which that Published Screen Rate is available) which is less than the relevant Interest Period; and

 

(b)                                 the applicable Published Screen Rate for the shortest period (for which that Published Screen Rate is available) which exceeds the relevant Interest Period.

 

“Investment” means (a) any loan or advance to any Person, any purchase or other acquisition of any Equity Interests or Debt or the assets comprising a division or business unit or a substantial part or all of the business of any Person, any capital contribution to any Person or any other direct or indirect investment in any Person, including, without limitation, any acquisition by way of a merger or consolidation and any arrangement pursuant to which the investor incurs Debt of the types referred to in clause (i) or (j) of the definition of “Debt” in respect of any Person, and (b) the purchase or other acquisition of any Healthcare Asset or other real property.

 

“ISP” has the meaning specified in Section 2.03(f).

 

“Issuing Bank” means the Initial Issuing Bank and any other Lender approved as an Issuing Bank by the Administrative Agent and the Borrower and any Eligible Assignee to which a Letter of Credit Commitment hereunder has been assigned pursuant to Section 9.07 so long as each such Lender or each such Eligible Assignee expressly agrees to perform in accordance with their terms all of the obligations that by the terms of this Agreement are required to be performed by it as an Issuing Bank and notifies the Administrative Agent of its Applicable Lending Office and the amount of its Letter of Credit Commitment (which information shall be recorded by the Administrative Agent in the Register) for so long as such Initial Issuing Bank, Lender or Eligible Assignee, as the case may be, shall have a Letter of Credit Commitment.

 

“Joint Venture” means any joint venture or other entity (a) in which the Borrower or any of its Subsidiaries holds any Equity Interest, (b) that is not a Subsidiary of the Borrower or any of its Subsidiaries and (c) the accounts of which would not appear on the Consolidated financial statements of the Borrower.

 

“Joint Venture Assets” means, with respect to any Joint Venture at any time, the assets owned by such Joint Venture at such time.

 

“JV Pro Rata Share” means, with respect to any Joint Venture at any time, the fraction, expressed as a percentage, obtained by dividing (a) the total gross book value of all Equity Interests in such Joint Venture held by the Borrower and any of its Subsidiaries by (b) the total gross book value of all outstanding Equity Interests in such Joint Venture at such time.

 

“L/C Cash Collateral Account” means an account of the Borrower to be maintained with the Administrative Agent, in the name of the Administrative Agent and under the sole control and dominion of the Administrative Agent and subject to the terms of this Agreement.

 

“L/C Related Documents” has the meaning specified in Section 2.04(c)(ii)(A).

 

“Lender Insolvency Event” means that, other than in connection with an Undisclosed Administration, (a) the Lender or its Parent Company is insolvent, or is generally unable to pay its debts as they become due, or admits in writing its inability to pay its debts as they become due, or makes a general assignment for the benefit of its creditors, or (b) such Lender or its Parent Company is the subject of a bankruptcy, insolvency, reorganization, liquidation or similar proceeding, or a receiver, trustee, conservator, intervenor or sequestrator or the like has been appointed for such Lender or its Parent Company, or such Lender or its Parent Company has taken any action in furtherance of or indicating its consent to or acquiescence in any such proceeding or appointment, or (c) such Lender or its Parent Company has become the subject of a Bail-In Action.  Notwithstanding the above, a Lender Insolvency Event shall not occur solely by virtue of the ownership or acquisition of any Equity

 

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Interest in the applicable Lender or any direct or indirect Parent Company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.

 

“Lender Party” means any Lender, the Swing Line Bank or any Issuing Bank.

 

“Lenders” means the Initial Lenders, each Acceding Lender that shall become a party hereto pursuant to Section 2.19 and each Person that shall become a Lender hereunder pursuant to Section 9.07 for so long as such Initial Lender or Person, as the case may be, shall be a party to this Agreement.

 

“Letter of Credit Advance” means an advance made by any Issuing Bank or any Lender pursuant to Section 2.03(c).

 

“Letter of Credit Agreement” has the meaning specified in Section 2.03(a).

 

“Letter of Credit Commitment” means, with respect to any Issuing Bank at any time, the amount set forth opposite such Issuing Bank’s name on Schedule I hereto under the caption “Letter of Credit Commitment” or, if such Issuing Bank has entered into one or more Assignment and Acceptances, set forth for such Issuing Bank in the Register maintained by the Administrative Agent pursuant to Section 9.07(d) as such Issuing Bank’s “Letter of Credit Commitment”, as such amount may be reduced at or prior to such time pursuant to Section 2.05.

 

“Letter of Credit Exposure” means, at any time, the sum of (a) the aggregate Available Amount of all outstanding Letters of Credit at such time plus (b) the aggregate amount of all payments or disbursements made by an Issuing Bank pursuant to a Letter of Credit Advance that have not yet been reimbursed at such time.

 

“Letter of Credit Facility” means, at any time, an amount equal to the lesser of (a) the aggregate amount of the Issuing Banks’ Letter of Credit Commitments at such time, and (b) $10,000,000, as such amount may be reduced at or prior to such time pursuant to Section 2.05.

 

“Letters of Credit” has the meaning specified in Section 2.01(b).

 

“Leverage Ratio” means, at any date of determination, the ratio of (a) Total Debt minus Unrestricted Cash, in each case as at the end of the most recently ended fiscal quarter of the Borrower for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be, to (b) EBITDA.

 

“Lien” means any lien, security interest or other charge or encumbrance of any kind, or any other type of preferential arrangement, including, without limitation, the lien or retained security title of a conditional vendor and any easement, right of way or other encumbrance on title to real property.

 

“Loan Documents” means (a) this Agreement, (b) the Notes, (c) the Fee Letter, (d) each Letter of Credit Agreement, (e) each Guaranty Supplement, (f) the Collateral Documents and (g) each other agreement or instrument now or hereafter executed and delivered by a Loan Party in connection with, pursuant to or relating to this Agreement, in each case, as amended.

 

“Loan Parties” means the Borrower and the Guarantors (each, a “Loan Party”).

 

“Management Agreements” means (a) the Management Agreements set forth on Part III of Schedule 4.01(q) to the Disclosure Letter (as supplemented from time to time in accordance with the

 

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provisions hereof), and (b) any Management Agreement in respect of a Borrowing Base Asset entered into after the Closing Date in compliance with Section 5.01(p).

 

“Management Fee Adjustment” means, with respect to any Asset for any fiscal period, the greater of (i) an amount equal to 5.0% of the total revenues generated from the operation of such Asset for such fiscal period and (ii) all actual management fees payable in respect of such Asset during such fiscal period.

 

“Margin Stock” has the meaning specified in Regulation U.

 

“Material Adverse Change” means a material adverse change in the business, condition (financial or otherwise), results of operations or prospects of the Borrower or the Borrower and its Subsidiaries, taken as a whole.

 

“Material Adverse Effect” means a material adverse effect on (a) the business, condition (financial or otherwise), operations or prospects of the Borrower and its Subsidiaries, taken as a whole, (b) the rights and remedies of any Agent or any Lender Party under any Loan Document, (c) the ability of any Loan Party to perform its Obligations under any Loan Document to which it is or is to be a party or (d) the value, use, operation or ability to sell or refinance any Borrowing Base Asset.

 

“Material Contract” means each contract to which the Borrower or any of its Subsidiaries is a party involving aggregate consideration payable to or by the Borrower or such Subsidiary in an amount of $5,000,000 or more per annum or otherwise material to the business, condition (financial or otherwise), operations, performance, properties or prospects of the Borrower and its Subsidiaries, taken as a whole.  Without limitation of the foregoing, the Management Agreements shall be deemed to comprise Material Contracts hereunder.

 

“Material Debt” means (a) any Non-Recourse Debt of any Loan Party or any Subsidiary of a Loan Party that is outstanding in a principal amount (or, in the case of any Hedge Agreement, an Agreement Value) of $20,000,000 or more or (b) any Recourse Debt of any Loan Party or any Subsidiary of a Loan Party that is outstanding in a principal amount (or, in the case of any Hedge Agreement, an Agreement Value) of $10,000,000 or more, in each case (i) whether or not the primary obligation of the applicable obligor, (ii) whether the subject of one or more separate debt instruments or agreements, and (iii) exclusive of Debt outstanding under this Agreement.  For the avoidance of doubt, Material Debt may include Refinancing Debt to the extent comprising Material Debt as defined herein.

 

“Material Litigation” has the meaning specified in Section 3.01(e).

 

“Maximum Rate” means the maximum nonusurious interest rate under applicable law.

 

“Medicaid” means collectively, the healthcare assistance program established by Title XIX of the Social Security Act (42 U.S.C. §1396 et seq.) and any statutes succeeding thereto, and all laws, rules, regulations, manuals, policies, procedures, orders, guidelines or requirements pertaining to such program including:  (a) all Federal statutes (whether set forth in Title XIX of the Social Security Act or elsewhere) affecting such program; (b) all state statutes, regulations and plans for medical assistance enacted in connection with such program and Federal rules and regulations promulgated in connection with such program; and (c) all applicable provisions of all rules, regulations, manuals, policies, procedures, orders and administrative, reimbursement, guidelines and requirements of all Governmental Authorities promulgated in connection with such program (whether or not having the force of law), in each case as the same may be amended, restated, supplemented or otherwise modified from time to time.

 

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“Medicare” means collectively, the health insurance program for the aged and disabled established by Title XVIII of the Social Security Act (42 U.S.C. §1395 et seq.) and any statutes succeeding thereto, and all laws, rules, regulations, manuals, policies, procedures, orders, guidelines or requirements pertaining to such program including:  (a) all Federal statutes (whether set forth in Title XVIII of the Social Security Act or elsewhere) affecting such program; and (b) all applicable provisions of all rules, regulations, manuals, policies, procedures, orders and administrative, reimbursement, guidelines and requirements of all Governmental Authorities promulgated in connection with such program (whether or not having the force of law), in each case as the same may be amended, restated, supplemented or otherwise modified from time to time.

 

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

 

“Mortgage Policies” has the meaning specified in Section 3.01(a)(iii)(B).

 

“Mortgage Receivable” means a promissory note secured by a mortgage of which the Borrower or a Subsidiary thereof is the holder and retains the rights of collection of all payments thereunder.

 

“Mortgages” has the meaning specified in Section 3.01(a)(iii).

 

“Multiemployer Plan” means a multiemployer plan, as defined in Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the preceding five plan years made or accrued an obligation to make contributions.

 

“Multiple Employer Plan” means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA Affiliate and at least one Person other than the Loan Parties and the ERISA Affiliates or (b) was so maintained and in respect of which any Loan Party or any ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA in the event such plan has been or were to be terminated.

 

“National Flood Insurance Program” means the program created pursuant to the Flood Laws.

 

“Negative Pledge” means, with respect to any asset, any provision of a document, instrument or agreement (other than a Loan Document) which prohibits or purports to prohibit the creation or assumption of any Lien on such asset as security for Debt of the Person owning such asset or any other Person.

 

“Net Operating Income” means, with respect to any Borrowing Base Asset for any applicable measurement period, (a) the total rental and other revenue from the operation of such Borrowing Base Asset for such period (“Operating Revenue”), minus (b) all expenses and other proper charges incurred in connection with the operation and maintenance of such Borrowing Base Asset for such period, including, without limitation, management fees, repairs, real estate and chattel taxes and bad debt expenses, but before payment or provision for debt service charges, income taxes and depreciation, amortization and other non-cash expenses (“Operating Expenses”), all as determined in accordance with GAAP and in each case for consecutive four fiscal quarters of the Borrower most recently ended for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be.

 

“New Borrowing Base Assets” means those Healthcare Assets identified on Schedule II hereto as “New Borrowing Base Assets”.

 

“Non-Consenting Lender” has the meaning specified in Section 9.01(b).

 

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“Non-Defaulting Lender” means, at any time, a Lender that is not a Defaulting Lender or a Potential Defaulting Lender.

 

“Non-Recourse Debt” means Debt for Borrowed Money with respect to which recourse for payment is limited to (a) any building(s) or parcel(s) of real property and any related assets encumbered by a Lien securing such Debt for Borrowed Money and/or (b) (i) the general credit of the Property-Level Subsidiary that has incurred such Debt for Borrowed Money, and/or the direct Equity Interests therein and/or (ii) the general credit of the immediate parent entity of such Property-Level Subsidiary, provided that such parent entity’s assets consist solely of Equity Interests in such Property-Level Subsidiary, it being understood that the instruments governing such Debt may include customary carve-outs to such limited recourse (any such customary carve-outs or agreements limited to such customary carve-outs, being a “Customary Carve-Out Agreement”) such as, for example, personal recourse to the Borrower or any Subsidiary of the Borrower for fraud, misrepresentation, misapplication or misappropriation of cash, waste, environmental claims, damage to properties, non-payment of taxes or other liens despite the existence of sufficient cash flow, interference with the enforcement of loan documents upon maturity or acceleration, voluntary or involuntary bankruptcy filings, violation of loan document prohibitions against transfer of properties or ownership interests therein and liabilities and other circumstances customarily excluded by lenders from exculpation provisions and/or included in separate indemnification and/or guaranty agreements in non-recourse financings of real estate.

 

“Note” means a promissory note of the Borrower payable to the order of any Lender, in substantially the form of Exhibit A hereto, evidencing the aggregate indebtedness of the Borrower to such Lender resulting from the Revolving Credit Advances, Swing Line Advances and Letter of Credit Advances made by such Lender.

 

“Notice of Borrowing” has the meaning specified in Section 2.02(a).

 

“Notice of Issuance” has the meaning specified in Section 2.03(a).

 

“Notice of Renewal” has the meaning specified in Section 2.01(b).

 

“Notice of Swing Line Borrowing” has the meaning specified in Section 2.02(b).

 

“Notice of Termination” has the meaning specified in Section 2.01(b).

 

“NPL” means the National Priorities List under CERCLA.

 

“Obligation” means, with respect to any Person, any payment, performance or other obligation of such Person of any kind, including, without limitation, any liability of such Person on any claim, whether or not the right of any creditor to payment in respect of such claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, disputed, undisputed, legal, equitable, secured or unsecured, and whether or not such claim is discharged, stayed or otherwise affected by any proceeding referred to in Section 6.01(f).  Without limiting the generality of the foregoing, the Obligations of any Loan Party under the Loan Documents include (a) the obligation to pay principal, interest, Letter of Credit commissions, charges, expenses, fees, attorneys’ fees and disbursements, indemnities and other amounts payable by such Loan Party under any Loan Document and (b) the obligation of such Loan Party to reimburse any amount in respect of any of the foregoing that any Lender Party, in its sole discretion, may elect to pay or advance on behalf of such Loan Party; provided, however, that in no event shall the Obligations of the Loan Parties under the Loan Documents include any Excluded Swap Obligations.

 

“OECD” means the Organization for Economic Cooperation and Development.

 

“OFAC” has the meaning specified in Section 4.01(z).

 

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“OIG” has the meaning specified in Section 4.01(y)(viii).

 

“Operating Expenses” has the meaning specified in the definition of Net Operating Income.

 

“Operating Revenue” has the meaning specified in the definition of Net Operating Income.

 

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

 

“Other Taxes” means all present or future stamp, court or documentary, property, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement, recordation, filing or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an  assignment (other than an assignment made pursuant to Section 2.18 or Section 9.01(b)).

 

“Parent Company” means, with respect to a Lender, the bank holding company (as defined in Federal Reserve Board Regulation Y), if any, of such Lender, and/or any Person owning, beneficially or of record, directly or indirectly, a majority of the shares of such Lender.

 

“Participant” has the meaning specified in Section 2.03(c)(i).

 

“Participant Register” has the meaning specified in Section 9.07(g).

 

“Patriot Act” has the meaning specified in Section 9.14.

 

“PBGC” means the Pension Benefit Guaranty Corporation (or any successor).

 

“Pending Borrowing Base Assets” means those Healthcare Assets identified on Schedule II hereto as “Pending Borrowing Base Assets”.

 

“Permitted Liens” means such of the following as to which no enforcement, collection, execution, levy or foreclosure proceeding shall have been commenced:  (a) Liens for taxes, assessments and governmental charges or levies not yet due and payable or, if due and payable, not yet delinquent, or subject to a Good Faith Contest; (b) Liens imposed by law, such as materialmen’s, mechanics’, carriers’, workmen’s and repairmen’s Liens and other similar Liens arising in the ordinary course of business securing obligations that (i) are either not overdue for a period of more than 30 days or are subject to a Good Faith Contest and (ii) individually or together with all other Permitted Liens outstanding on any date of determination do not materially adversely affect the use of the property to which they relate; (c) pledges or deposits to secure obligations under workers’ compensation or unemployment laws or similar legislation or to secure public or statutory obligations; (d) easements, zoning restrictions, rights of way and other encumbrances on title to real property that do not render title to the property encumbered thereby unmarketable or materially adversely affect the use or value of such property for its present purposes; (e) Tenancy Leases; (f) Permitted Encumbrances (as defined in each of the Mortgages); (g) deposits to secure trade contracts (other than for debt), statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business; and (h) (as to any Pending Borrowing Base Asset, but only until such time as the Guarantor owner of such Pending Borrowing Base Asset receives all Healthcare Licenses necessary to operate such Asset) a lease by such Guarantor, as landlord, to the holder (which shall remain an Affiliate of the Borrower) of the Healthcare Licenses for such Asset existing on the date hereof, as lessee.

 

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“Person” means an individual, partnership, corporation (including a business trust or statutory trust), limited liability company, joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.

 

“Plan” means a Single Employer Plan or a Multiple Employer Plan.

 

“Post Petition Interest” has the meaning specified in Section 7.07(b).

 

“Potential Defaulting Lender” means, at any time, (i) any Lender with respect to which an event of the kind referred to in the definition of “Lender/Insolvency Event” has occurred and is continuing in respect of any Subsidiary of such Lender, (ii) any Lender that has notified, or whose Parent Company or a Subsidiary thereof has notified, the Administrative Agent, the Borrower, the Issuing Bank or the Swing Line Bank in writing, or has stated publicly, that it does not intend to comply with its funding obligations under any other loan agreement or credit agreement or other similar agreement, unless such writing or statement states that such position is based on such Lender’s determination that one or more conditions precedent to funding cannot be satisfied (which conditions precedent, together with the applicable default, if any, will be specifically identified in such writing or public statement), or (iii) any Lender that has, or whose Parent Company has been downgraded after the Closing Date to a non-investment grade rating from Moody’s or S&P or another nationally recognized rating agency.  Any determination by the Administrative Agent that a Lender is a Potential Defaulting Lender under any of clauses (i) through (iii) above will be conclusive and binding absent demonstrable error, and such Lender will be deemed a Potential Defaulting Lender (subject to Section 2.17(f)) upon notification of such determination by the Administrative Agent to the Borrower, the Issuing Bank, the Swing Line Bank and the Lenders.

 

“Published Screen Rate” has the meaning specified in the definition of “Screen Rate”.

 

“Preferred Interests” means, with respect to any Person, Equity Interests issued by such Person that are entitled to a preference or priority over any other Equity Interests issued by such Person upon any distribution of such Person’s property and assets, whether by dividend or upon liquidation.

 

“Private Pay” means any payment, reimbursement or refund in connection with healthcare services, products or supplies that does not derive or is unavailable from Medicare, Medicaid, Tricare, Veteran’s Administration or any other healthcare reimbursement program administered by a Governmental Authority.

 

“Property-Level Subsidiary” means any Subsidiary of the Borrower or any Joint Venture that holds a direct fee or leasehold interest in any single building (or group of related buildings, including, without limitation, buildings pooled for purposes of a Non-Recourse Debt financing) or parcel (or group of related parcels, including, without limitation, parcels pooled for purposes of a Non-Recourse Debt financing) of real property and related assets and not in any other building or parcel of real property.

 

“Proposed Increased Commitment” has the meaning specified in Section 2.19(b).

 

“Proposed Borrowing Base Asset” has the meaning specified in Section 5.01(k).

 

“Pro Rata Share” of any amount means, with respect to any Lender at any time, the product of such amount times a fraction the numerator of which is the amount of such Lender’s Revolving Credit Commitment at such time (or, if the Commitments shall have been terminated pursuant to Section 2.05 or 6.01, such Lender’s Revolving Credit Commitment as in effect immediately prior to such termination) and the denominator of which is the Revolving Credit Facility at such time (or, if the Commitments shall have been terminated pursuant to Section 2.05 or 6.01, the Revolving Credit Facility as in effect immediately prior to such termination).

 

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“Purchasing Lender” has the meaning specified in Section 2.19(e).

 

“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Guarantor that has total assets exceeding $10,000,000 at the time such Swap Obligation is incurred or such other Person as constitutes an ECP under the Commodity Exchange Act or any regulations promulgated thereunder.

 

“Qualifying Ground Lease” means a ground lease of Real Property containing the following terms and conditions:  (a) a remaining term (exclusive of any unexercised extension options that are subject to terms or conditions not yet agreed upon and specified in such ground lease or an amendment thereto, other than a condition that the lessee not be in default under such ground lease) of 30 years or more from the date the related Healthcare Asset becomes a Borrowing Base Asset; (b) the right of the lessee to mortgage and encumber its interest in the leased property without the consent of the lessor; (c) the obligation of the lessor to give the holder of any mortgage Lien on such leased property written notice of any defaults on the part of the lessee and agreement of such lessor that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so; (d) reasonable transferability of the lessee’s interest under such lease, including the ability to sublease; and (e) such other rights customarily required by mortgagees making a loan secured by the interest of the holder of a leasehold estate demised pursuant to a ground lease.

 

“Real Property” means all right, title and interest of the Borrower and each of its Subsidiaries in and to any land and any improvements located thereon, together with all equipment, furniture, materials, supplies, personal property and all other rights and property within the scope of the definition of Mortgaged Property (as defined in the Form of Mortgage attached hereto as Exhibit G) in which such Person has an interest now or hereafter located on or used in connection with such land and improvements, and all appurtenances, additions, improvements, renewals, substitutions and replacements thereof now or hereafter acquired by such Person.

 

“Recipient” means (a) the Administrative Agent or (b) any Lender Party.

 

“Recourse Debt” means Debt for which the Borrower or any of its Subsidiaries has personal or recourse liability in whole or in part, exclusive of any such Debt for which such personal or recourse liability is limited to obligations under Customary Carve-Out Agreements, and provided that no claim shall have been made under such Customary Carve-Out Agreements.

 

“Refinancing Debt” means, with respect to any Debt, any Debt extending the maturity of, or refunding or refinancing, in whole or in part, such Debt, provided that (a) the terms of any Refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, (i) do not provide for any Lien on any Borrowing Base Assets, and (ii) are not otherwise prohibited by the Loan Documents, (b) the principal amount of such Debt shall not exceed the principal amount of the Debt being extended, refunded or refinanced plus the amount of any applicable premium and expenses, and (c) the other material terms, taken as a whole, of any such Debt are no less favorable in any material respect to the Loan Parties or the Lender Parties than the terms governing the Debt being extended, refunded or refinanced.

 

“Register” has the meaning specified in Section 9.07(d).

 

“Regulation U” means Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time.

 

“Replacement Lender” has the meaning specified in Section 2.18.

 

“Required Lenders” means, at any time, Lenders owed or holding greater than 50% of the sum of (a) the aggregate principal amount of the Advances outstanding at such time, (b) the aggregate Available Amount of all Letters of Credit outstanding at such time and (c) the aggregate Unused

 

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Revolving Credit Commitments at such time.  For purposes of this definition, the aggregate principal amount of Swing Line Advances owing to the Swing Line Bank and of Letter of Credit Advances owing to any Issuing Bank and the Available Amount of each Letter of Credit shall be considered to be owed to the Revolving Lenders ratably in accordance with their respective Revolving Credit Commitments.

 

“Responsible Officer” means, with respect to any Loan Party, any officer of, or any officer of any general partner or managing member of, such Loan Party, which Officer has (a) responsibility for performing the underlying function that is the subject of the action required of such officer hereunder, or (b) supervisory responsibility for such an officer.

 

“Revolving Credit Advance” has the meaning specified in Section 2.01(a).

 

“Revolving Credit Commitment” means, (a) with respect to any Lender at any time, the amount set forth opposite such Lender’s name on Schedule I hereto under the caption “Revolving Credit Commitment” or (b) if such Lender has entered into one or more Assignment and Acceptances, set forth for such Lender in the Register maintained by the Administrative Agent pursuant to Section 9.07(d) as such Lender’s “Revolving Credit Commitment”, as such amount may be reduced at or prior to such time pursuant to Section 2.05.

 

“Revolving Credit Exposure” means, at any time, the sum of the aggregate principal amount of all outstanding Revolving Credit Advances.

 

“Revolving Credit Facility” means, at any time, the aggregate amount of the Lenders’ Revolving Credit Commitments at such time.

 

“RMR LLC” has the meaning specified in the definition of ABP Stockholders.

 

“S&P” means Standard & Poor’s Financial Services LLC, a division of McGraw-Hill Financial Inc., and any successor thereto.

 

“Sale and Leaseback Transaction” shall mean any arrangement with any Person providing for the leasing by the Borrower or any of its Subsidiaries of any Real Property that has been sold or transferred or is to be sold or transferred by the Borrower or such Subsidiary, as the case may be, to such Person.

 

“Sanctions” has the meaning set forth in Section 4.01(z).

 

“Sarbanes-Oxley” means the Sarbanes-Oxley Act of 2002, as amended.

 

“Screen Rate” means, for any Interest Period, the rate per annum (rounded upward, if necessary, to the nearest 1/100 of 1%) determined by the Administrative Agent to be the ICE Benchmark Administration Limited LIBOR Rate (“ICE LIBOR”) for deposits in Dollars (for delivery on the first day of such Interest Period) for a term equivalent to such Interest Period as published by Reuters or another commercially available source providing quotations of ICE LIBOR as designated by the Administrative Agent from time to time in place of Reuters (the “Published Screen Rate”); provided, however, that if the Published Screen Rate is not available for a period corresponding to the relevant Interest Period but is available for other periods, then “Screen Rate” shall mean the Interpolated Rate; provided further that in no circumstances shall the Screen Rate be less than 0% per annum.

 

“Second Extension Date” has the meaning specified in Section 2.16.

 

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“Secured Obligations” means, collectively, the “Secured Obligations” as defined in the Security Agreement and the “Obligations” as defined in the Mortgages, in each case exclusive of all Excluded Swap Obligations.

 

“Secured Parties” means the Agents and the Lender Parties.

 

“Securities Act” means the Securities Act of 1933, as amended to the date hereof and from time to time hereafter, and any successor statute.

 

“Securities Exchange Act” means the Securities Exchange Act of 1934, as amended to the date hereof and from time to time hereafter, and any successor statute.

 

“Security Agreement” has the meaning specified in Section 3.01(a)(ii).

 

“Selling Lender” has the meaning specified in Section 2.19(e).

 

“Single Employer Plan” means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA Affiliate and no Person other than the Loan Parties and the ERISA Affiliates or (b) was so maintained and in respect of which any Loan Party or any ERISA Affiliate could have liability under Section 4069 of ERISA in the event such plan has been or were to be terminated.

 

“SNH” means Senior Housing Properties Trust, a Maryland real estate investment trust.

 

“Social Security Act” means 42 U.S.C. §301 et seq., as enacted in 1935, and amended, restated or otherwise supplemented thereafter from time to time and all rules and regulations promulgated thereunder.

 

“Solvent” means, with respect to any Person on a particular date, that on such date (a) the fair value of the property of such Person, on a going-concern basis, is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of such Person, (b) the present fair salable value of the assets of such Person, on a going-concern basis, 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, (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay such debts and liabilities as they mature and (d) such Person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such Person’s property would constitute an unreasonably small capital.  The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all the facts and circumstances existing at such time (including, without limitation, after taking into account appropriate discount factors for the present value of future contingent liabilities), represents the amount that can reasonably be expected to become an actual or matured liability.

 

“Special Flood Hazard Area” means an area that FEMA has designated as an area subject to special flood or mud slide hazards.

 

“Standby Letter of Credit” means any Letter of Credit issued under the Letter of Credit Facility, other than a Trade Letter of Credit.

 

“Stark Law” has the meaning specified in Section 4.01(y).

 

“Subordinated Obligations” has the meaning specified in Section 7.07.

 

“Subsidiary” of any Person means any corporation, partnership, joint venture, limited liability company, trust or estate of which (or in which) 50% or more of (a) the issued and outstanding capital stock having ordinary voting power to elect a majority of the Board of Directors of such corporation (irrespective of whether at the time capital stock of any other class or classes of such corporation shall

 

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or might have voting power upon the occurrence of any contingency), (b) the interest in the capital or profits of such partnership, joint venture or limited liability company or (c) the beneficial interest in such trust or estate, in each case, is at the time directly or indirectly owned or controlled by such Person, by such Person and one or more of its other Subsidiaries or by one or more of such Person’s other Subsidiaries.

 

“Supplemental Collateral Agent” has the meaning specified in Section 8.01(b).

 

“Surviving Debt” means Debt of each Loan Party and its Subsidiaries outstanding immediately before and after the Closing Date.

 

“Swap Obligation” means, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

 

“Swing Line Advance” means an advance made by (a) the Swing Line Bank pursuant to Section 2.01(c) or (b) any Lender pursuant to Section 2.02(b).

 

“Swing Line Bank” means Citibank, in its capacity as the Lender of Swing Line Advances, and its successors and permitted assigns in such capacity.

 

“Swing Line Borrowing” means a borrowing consisting of a Swing Line Advance made by the Swing Line Bank pursuant to Section 2.01(c) or the Lenders pursuant to Section 2.02(b).

 

“Swing Line Commitment” means, with respect to the Swing Line Bank, the amount of the Swing Line Facility set forth in Section 2.01(c), as such amount may be reduced at or prior to such time pursuant to Section 2.05.

 

“Swing Line Exposure” means, at any time, the sum of the aggregate principal amount of all outstanding Swing Line Advances.

 

“Swing Line Facility” has the meaning specified in Section 2.01(c).

 

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

 

“Tenancy Leases” means operating leases, subleases, licenses, occupancy agreements and rights-of-use entered into by the Borrower or any of its Subsidiaries in its capacity as a lessor or a similar capacity in the ordinary course of business that do not materially and adversely affect the use of any Healthcare Asset or other Real Property encumbered thereby for its intended purpose (excluding any lease entered into in connection with a Sale and Leaseback Transaction).

 

“Termination Date” means the earlier of (a) the third anniversary of the Closing Date, subject to the extension thereof pursuant to Section 2.16 and (b) the date of termination in whole of the Revolving Credit Commitments, the Swing Line Commitment and the Letter of Credit Commitments pursuant to Section 2.05 or 6.01.

 

“Test Date” means (a) the last day of each fiscal quarter of the Borrower for which financial statements are required to be delivered pursuant to Sections 5.03(b) or (c), as the case may be, (b) the date of each Advance or the issuance or renewal of any Letter of Credit, (c) the date of the addition of any Proposed Borrowing Base Asset to the Collateral pursuant to Section 5.01(k), (d) the effective date of any merger permitted under Section 5.02(d), (e) the effective date of any Transfer permitted under Section 5.02(e)(iii), (f) with respect to an extension of the Termination Date pursuant to

 

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Section 2.16, the date of delivery of financial statements of the Borrower thereunder, and (g) the date on which any new Material Debt is incurred.

 

“Total Asset Value” means, at any date of determination, the sum of the Asset Values for all Assets at such date.

 

“Total Borrowing Base Value” means an amount equal to the sum of the Borrowing Base Values of all Borrowing Base Assets; provided, however, that the value of any Pending Borrowing Base Asset shall be deemed to be zero ($0.00) until such time as all Collateral Deliverables relating to such Asset have been received by the Administrative Agent; and provided further that the following asset concentration restrictions shall apply to the calculation of Total Borrowing Base Value:  (i) the number of Borrowing Base Assets shall not be less than 5 at any time or the Total Borrowing Base Value shall be deemed to be zero ($0.00), (ii) the aggregate Asset Values of all Borrowing Base Assets shall not be less than $100,000,000 at any time or the Total Borrowing Base Value shall be deemed to be zero ($0.00), (iii) the Adjusted Net Operating Income of any individual Borrowing Base Asset shall not account for more than 25% of the aggregate Adjusted Net Operating Income of all Borrowing Base Assets at any time (provided, that to the extent such percentage is exceeded, the Borrowing Base Value of such Asset for the purposes of the calculation of the Total Borrowing Base Value shall be reduced by multiplying the Borrowing Base Value of such Asset by a fraction, (A) the numerator of which is 25% and (B) the denominator of which is the percentage obtained by dividing the Adjusted Net Operating Income of such Asset by the Adjusted Net Operating Income of all Borrowing Base Assets), and (iv) the aggregate Operating Revenue of the Borrowing Base Assets attributable to Private Pay shall not account for less than 75% of the aggregate Operating Revenue of all Borrowing Base Assets (provided, that to the extent such percentage is not met, the Total Borrowing Base Value shall be reduced by multiplying the Total Borrowing Base Value by a fraction, (A) the numerator of which is the percentage obtained by dividing the aggregate Operating Revenue of the Borrowing Base Assets attributable to Private Pay by the aggregate Operating Revenue of all Borrowing Base Assets and (B) the denominator of which is 75%).

 

“Total Debt” means, at any date of determination, all Consolidated Debt of the Borrower and its Subsidiaries as at the end of the most recently ended fiscal quarter of the Borrower for which financial statements are required to be delivered to the Lender Parties pursuant to Section 5.03(b) or (c), as the case may be.

 

“Trade Letter of Credit” means any Letter of Credit that is issued under the Letter of Credit Facility for the benefit of a supplier of Inventory to the Borrower or any of its Subsidiaries to effect payment for such Inventory.

 

“Transfer” has the meaning specified in Section 5.02(e).

 

“Transfer Healthcare Assets” means all Healthcare Assets and Healthcare Licenses associated with Clearwater Commons, located at 4519 E. 82nd Street, Indianapolis, IN 46250 and New Seasons at Voorhees, located at 501 Laurel Oak Road, Voorhees, NJ 08043.

 

“Tricare” means the health care program administered by the Department of Defense that provides health care benefits to members of the military, military retirees, certain members of the military reserve, and their dependents.

 

“Type” refers to the distinction between Advances bearing interest at the Base Rate and Advances bearing interest at the Eurodollar Rate.

 

“UCP” has the meaning specified in Section 2.03(f).

 

“Undisclosed Administration” means in relation to a Lender or its direct or indirect parent company, the appointment of an administrator, provisional liquidator, conservator, receiver, trust,

 

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custodian or other similar official by a supervisory authority or regulator under or based on the law in the country where such Lender is subject to home jurisdiction supervision if applicable law requires that such appointment is not to be publicly disclosed.

 

“Unrestricted Cash” means an amount (if greater than zero) equal to (a) cash and Cash Equivalents of the Borrower and its Subsidiaries that are not subject to any Lien (excluding statutory liens in favor of any depositary bank where such cash is maintained), minus (b) the sum of amounts included in the foregoing clause (a) that are with a Person other than the Borrower and its Subsidiaries as escrows, deposits or security for contractual obligations, minus (c) insurance and condemnation proceeds received by Borrower to be reinvested under Section 5.01(s).

 

“Unsecured Debt” means Debt for Borrowed Money not secured in any manner by any Lien.

 

“Unused Fee” has the meaning specified in Section 2.08(a).

 

“Unused Revolving Credit Commitment” means, with respect to any Lender at any date of determination, (a) such Lender’s Revolving Credit Commitment at such time minus (b) the sum of (i) the aggregate principal amount of all Revolving Credit Advances, Swing Line Advances and Letter of Credit Advances made by such Lender (in its capacity as a Lender) and outstanding at such time plus (ii) such Lender’s Pro Rata Share of (A) the aggregate Available Amount of all Letters of Credit outstanding at such time, (B) the aggregate principal amount of all Letter of Credit Advances made by the Issuing Banks pursuant to Section 2.03(c) and outstanding at such time and (C) the aggregate principal amount of all Swing Line Advances made by the Swing Line Bank pursuant to Section 2.01(c) and outstanding at such time.

 

“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Internal Revenue Code.

 

“U.S. Tax Compliance Certificate” has the meaning specified in Section 2.12(g)(ii)(C).

 

“Veteran’s Administration” means, collectively, the healthcare programs administered by the U.S. Department of Veteran’s Affairs, Veteran’s Health Administration and established by Title 38 Chapter 17 of the United States Code and any statutes succeeding thereto.

 

“Voting Interests” means shares of capital stock issued by a corporation, or equivalent Equity Interests in any other Person, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or the election or appointment of persons performing similar functions) of such Person, even if the right so to vote has been suspended by the happening of such a contingency.

 

“Welfare Plan” means a welfare plan, as defined in Section 3(1) of ERISA, that is maintained for employees of any Loan Party or in respect of which any Loan Party could have liability under applicable law.

 

“Withdrawal Liability” has the meaning specified in Part I of Subtitle E of Title IV of ERISA.

 

“Withholding Agent” means (a) any Loan Party or (b) the Administrative Agent.

 

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

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SECTION 1.02                                 Computation of Time Periods; Other Definitional Provisions.  In this Agreement and the other Loan Documents in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”.  References in the Loan Documents to any agreement or contract “as amended” shall mean and be a reference to such agreement or contract as amended, amended and restated, supplemented or otherwise modified from time to time in accordance with its terms.

 

SECTION 1.03                                 Accounting Terms.  All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles consistent with those applied in the preparation of the financial statements referred to in Section 4.01(g) (“GAAP”); provided that if at any time any change in GAAP would affect the computation of any financial ratio set forth in any Loan Document, and the Borrower or the Required Lenders shall so request, the Administrative Agent and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to approval by the Required Lenders and the Borrower); provided that, until so amended, such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein, and the Borrower shall provide to the Administrative Agent and the Lenders within five days after delivery of each certificate or financial report required hereunder that is affected thereby a written statement of a Responsible Officer of the Borrower setting forth in reasonable detail the differences (including any differences that would affect any calculations relating to the financial covenants as set forth in Section 5.04) that would have resulted if such financial statements had been prepared without giving effect to such change.

 

ARTICLE II
 AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF CREDIT

 

SECTION 2.01                                 The Advances and the Letters of Credit.  (a)  The Revolving Credit Advances.  Each Lender severally agrees, on the terms and conditions hereinafter set forth, to make advances (each, a “Revolving Credit Advance”) to the Borrower from time to time on any Business Day during the period from the date hereof until the Termination Date in an amount for each such Advance not to exceed such Lender’s Unused Revolving Credit Commitment at such time.  Each Borrowing shall be in an aggregate amount of $1,000,000 or an integral multiple of $250,000 in excess thereof and shall consist of Revolving Credit Advances made simultaneously by the Lenders ratably according to their Revolving Credit Commitments.  Within the limits of each Lender’s Unused Revolving Credit Commitment in effect from time to time and prior to the Termination Date, the Borrower may borrow under this Section 2.01(a), prepay pursuant to Section 2.06(a) and reborrow under this Section 2.01(a).

 

(b)                                 Letters of Credit.  Each Issuing Bank severally agrees, on the terms and conditions hereinafter set forth, to issue (or cause its Affiliate that is a commercial bank to issue on its behalf) letters of credit denominated in U.S. Dollars (such letters of credit, together with the Existing Letters of Credit, the “Letters of Credit”), for the account of the Borrower from time to time on any Business Day during the period from the date hereof until 60 days before the Termination Date in an aggregate Available Amount (i) for all Letters of Credit not to exceed at any time the Letter of Credit Facility at such time, (ii) for all Letters of Credit issued by such Issuing Bank not to exceed such Issuing Bank’s Letter of Credit Commitment at such time, and (iii) for each such Letter of Credit not to exceed the Unused Revolving Credit Commitments of the Lenders at such time.  No Letter of Credit shall have an expiration date (including all rights of the Borrower or the beneficiary to require renewal) later than the Termination Date and (A) in the case of a Standby Letter of Credit one year after the date of issuance thereof, but may by its terms be renewable annually upon notice (a “Notice of Renewal”) given to the Issuing Bank that issued such Standby Letter of Credit and the Administrative Agent on or prior to any date for notice of renewal set forth in such Letter of Credit but in any event at least three Business Days prior to the date of the proposed renewal of such Standby Letter of Credit and upon fulfillment of the applicable conditions set forth in Article III unless such Issuing Bank has notified the Borrower (with a copy to the Administrative Agent) on or prior to the date for notice of termination set forth in such Letter of Credit but in any event at least 30 Business Days prior to the date of automatic renewal of its election not to renew such Standby Letter of Credit (a “Notice of Termination”) and (B) in the case of a

 

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Trade Letter of Credit, 60 days after the date of issuance thereof; provided, however, that the terms of each Standby Letter of Credit that is automatically renewable annually shall (x) require the Issuing Bank that issued such Standby Letter of Credit to give the beneficiary named in such Standby Letter of Credit notice of any Notice of Termination, (y) permit such beneficiary, upon receipt of such notice, to draw under such Standby Letter of Credit prior to the date such Standby Letter of Credit otherwise would have been automatically renewed and (z) not permit the expiration date (after giving effect to any renewal) of such Standby Letter of Credit in any event to be extended to a date later than the Termination Date.  If either a Notice of Renewal is not given by the Borrower or a Notice of Termination is given by the relevant Issuing Bank pursuant to the immediately preceding sentence, such Standby Letter of Credit shall expire on the date on which it otherwise would have been automatically renewed; provided, however, that even in the absence of receipt of a Notice of Renewal the relevant Issuing Bank may in its discretion, unless instructed to the contrary by the Administrative Agent or the Borrower, deem that a Notice of Renewal had been timely delivered and in such case, a Notice of Renewal shall be deemed to have been so delivered for all purposes under this Agreement.  Within the limits of the Letter of Credit Facility, and subject to the limits referred to above, the Borrower may request the issuance of Letters of Credit under this Section 2.01 (b), repay any Letter of Credit Advances resulting from drawings thereunder pursuant to Section 2.04(c) and request the issuance of additional Letters of Credit under this Section 2.01(b).

 

(c)                                  Swing Line Advances.  The Borrower may request the Swing Line Bank to make, and the Swing Line Bank agrees to make, on the terms and conditions hereinafter set forth, Swing Line Advances to the Borrower from time to time on any Business Day during the period from the date hereof until the Termination Date (i) in an aggregate amount not to exceed at any time outstanding $25,000,000 (the “Swing Line Facility”) and (ii) in an amount for each such Swing Line Borrowing not to exceed the aggregate of the Unused Revolving Credit Commitments of the Lenders at such time.  No Swing Line Advance shall be used for the purpose of funding the payment of principal of any other Swing Line Advance.  Each Swing Line Borrowing shall be in an amount of $250,000 or an integral multiple of $250,000 in excess thereof and shall be made as a Base Rate Advance.  Within the limits of the Swing Line Facility and within the limits referred to in clause (ii) above, the Borrower may borrow under this Section 2.01(c), repay pursuant to Section 2.04(b) or prepay pursuant to Section 2.06(a) and reborrow under this Section 2.01(c).

 

SECTION 2.02                                 Making the Advances.  (a)  Except as otherwise provided in Section 2.03, each Borrowing (other than a Swing Line Borrowing) shall be made on notice, given not later than 12:00 Noon (New York City time) on the third Business Day prior to the date of the proposed Borrowing in the case of a Borrowing consisting of Eurodollar Rate Advances, or not later than 1:00 P.M. (New York City time) on the date one Business Day prior to the date of the proposed Borrowing in the case of a Borrowing consisting of Base Rate Advances, by the Borrower to the Administrative Agent, which shall give to each Lender prompt notice thereof by telex or telecopier.  Each such notice of a Borrowing (a “Notice of Borrowing”) shall be by telephone, confirmed immediately in writing, or telex or telecopier or e-mail, in each case in substantially the form of Exhibit B hereto, specifying therein the requested (i) date of such Borrowing, (ii) Type of Advances comprising such Borrowing, (iii) aggregate amount of such Borrowing and (iv) in the case of a Borrowing consisting of Eurodollar Rate Advances, initial Interest Period for each such Advance.  Each Lender shall, before 12:00 Noon (New York City time) on the date of such Borrowing in the case of a Borrowing consisting of Eurodollar Rate Advances and 1:00 P.M. (New York City time) on the date of such Borrowing in the case of a Borrowing consisting of Base Rate Advances, make available for the account of its Applicable Lending Office to the Administrative Agent at the Administrative Agent’s Account, in same day funds, such Lender’s ratable portion of such Borrowing in accordance with the respective Commitments of such Lender and the other Lenders.  After the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable conditions set forth in Article III, the Administrative Agent will make such funds available to the Borrower by crediting the Borrower’s Account; provided, however, that the Administrative Agent shall first make a portion of such funds equal to the aggregate principal amount of any Swing Line Advances and Letter of Credit Advances made by the Swing Line Bank or any Issuing Bank, as the case may be, and by any other Lender and outstanding on the date of such Borrowing, plus interest accrued and unpaid thereon to and as of such date, available to the Swing Line Bank or such Issuing Bank, as the case may be, and such other Lenders for repayment of such Swing Line Advances and Letter of Credit Advances.

 

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(b)                                 Each Swing Line Borrowing shall be made on notice, given not later than 12:00 Noon (New York City time) on the date of the proposed Swing Line Borrowing, by the Borrower to the Swing Line Bank and the Administrative Agent.  Each such notice of a Swing Line Borrowing (a “Notice of Swing Line Borrowing”) shall be by telephone, confirmed immediately in writing or by telecopier or e-mail, in each case specifying therein the requested (i) date of such Borrowing, (ii) amount of such Borrowing and (iii) maturity of such Borrowing (which maturity shall be no later than the earlier of (A) the seventh day after the requested date of such Borrowing and (B) the Termination Date).  The Swing Line Bank shall, before 1:00 P.M. (New York City time) on the date of such Swing Line Borrowing, make the amount thereof available to the Administrative Agent at the Administrative Agent’s Account, in same day funds.  After the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable conditions set forth in Article III, the Administrative Agent will make such funds available to the Borrower by crediting the Borrower’s Account.  Upon written demand by the Swing Line Bank, with a copy of such demand to the Administrative Agent, each other Lender shall purchase from the Swing Line Bank, and the Swing Line Bank shall sell and assign to each such other Lender, such other Lender’s Pro Rata Share of such outstanding Swing Line Advance as of the date of such demand, by making available for the account of its Applicable Lending Office to the Administrative Agent for the account of the Swing Line Bank, by deposit to the Administrative Agent’s Account, in same day funds, an amount equal to the portion of the outstanding principal amount of such Swing Line Advance to be purchased by such Lender.  The Borrower hereby agrees to each such sale and assignment.  Each Lender agrees to purchase its Pro Rata Share of an outstanding Swing Line Advance on (i) the Business Day on which demand therefor is made by the Swing Line Bank, provided that notice of such demand is given not later than 12:00 Noon (New York City time) on such Business Day or (ii) the first Business Day next succeeding such demand if notice of such demand is given after such time.  Upon any such assignment by the Swing Line Bank to any other Lender of a portion of a Swing Line Advance, the Swing Line Bank represents and warrants to such other Lender that the Swing Line Bank is the legal and beneficial owner of such interest being assigned by it, but makes no other representation or warranty and assumes no responsibility with respect to such Swing Line Advance, the Loan Documents or any Loan Party.  If and to the extent that any Lender shall not have so made the amount of such Swing Line Advance available to the Administrative Agent, such Lender agrees to pay to the Administrative Agent forthwith on demand such amount together with interest thereon, for each day from the date of demand by the Swing Line Bank until the date such amount is paid to the Administrative Agent, at the Federal Funds Rate.  If such Lender shall pay to the Administrative Agent such amount for the account of the Swing Line Bank on any Business Day, such amount so paid in respect of principal shall constitute a Swing Line Advance made by such Lender on such Business Day for purposes of this Agreement, and the outstanding principal amount of the Swing Line Advance made by the Swing Line Bank shall be reduced by such amount on such Business Day.

 

(c)                                  Anything in subsection (a) above to the contrary notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances for the initial Borrowing hereunder or for any Borrowing if the aggregate amount of such Borrowing is less than $1,000,000 or if the obligation of the Lenders to make Eurodollar Rate Advances shall then be suspended pursuant to Section 2.07(d)(ii), 2.09 or 2.10 and (ii) there may not be more than five separate Interest Periods in effect hereunder at any time.

 

(d)                                 Each Notice of Borrowing and Notice of Swing Line Borrowing shall be irrevocable and binding on the Borrower.  In the case of any Borrowing that the related Notice of Borrowing specifies is to be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each Lender against any loss, cost or expense incurred by such Lender as a result of any failure to fulfill on or before the date specified in such Notice of Borrowing for such Borrowing the applicable conditions set forth in Article III, including, without limitation, any loss, cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund the Advance to be made by such Lender as part of such Borrowing when such Advance, as a result of such failure, is not made on such date.

 

(e)                                  Unless the Administrative Agent shall have received notice from a Lender prior to (x) the date of any Borrowing consisting of Eurodollar Rate Advances or (y) 12:00 Noon (New York City time) on the date of any Borrowing consisting of Base Rate Advances that such Lender will not make available to the Administrative Agent such Lender’s ratable portion of such Borrowing, the Administrative Agent may

 

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assume that such Lender has made such portion available to the Administrative Agent on the date of such Borrowing in accordance with subsection (a) of this Section 2.02 and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount.  If and to the extent that such Lender shall not have so made such ratable portion available to the Administrative Agent, such Lender and the Borrower severally agree to repay or pay to the Administrative Agent forthwith on demand such corresponding amount and to pay interest thereon, for each day from the date such amount is made available to the Borrower until the date such amount is repaid or paid to the Administrative Agent, at (i) in the case of the Borrower, the interest rate applicable at such time under Section 2.07 to Advances comprising such Borrowing and (ii) in the case of such Lender, the Federal Funds Rate.  If such Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender’s Advance as part of such Borrowing for all purposes.

 

(f)                                   The failure of any Lender to make the Advance to be made by it as part of any Borrowing shall not relieve any other Lender of its obligation, if any, hereunder to make its Advance on the date of such Borrowing, but no Lender shall be responsible for the failure of any other Lender to make the Advance to be made by such other Lender on the date of any Borrowing.

 

SECTION 2.03                                 Issuance of and Drawings and Reimbursement Under Letters of Credit.  (a)  Request for Issuance.  Each Letter of Credit shall be issued upon notice, given not later than 12:00 Noon (New York City time) on the fifth Business Day prior to the date of the proposed issuance of such Letter of Credit, by the Borrower to any Issuing Bank, which shall give to the Administrative Agent and each Lender prompt notice thereof by telex, telecopier or e-mail or by means of the Approved Electronic Platform.  Each such notice of issuance of a Letter of Credit (a “Notice of Issuance”) shall be by telephone, confirmed immediately in writing, telex, telecopier or e-mail, in each case specifying therein the requested (i) date of such issuance (which shall be a Business Day), (ii) Available Amount of such Letter of Credit, (iii) expiration date of such Letter of Credit, (iv) name and address of the beneficiary of such Letter of Credit and (v) form of such Letter of Credit, and shall be accompanied by such application and agreement for letter of credit as such Issuing Bank may specify to the Borrower for use in connection with such requested Letter of Credit (a “Letter of Credit Agreement”).  If (y) the requested form of such Letter of Credit is acceptable to such Issuing Bank in its sole discretion and (z) it has not received notice of objection to such issuance from the Required Lenders, such Issuing Bank will, upon fulfillment of the applicable conditions set forth in Article III, make such Letter of Credit available to the Borrower at its office referred to in Section 9.02 or as otherwise agreed with the Borrower in connection with such issuance.  In the event and to the extent that the provisions of any Letter of Credit Agreement shall conflict with this Agreement, the provisions of this Agreement shall govern.

 

(b)                                 Letter of Credit Reports.  Each Issuing Bank shall furnish (i) to each Lender on the first Business Day of each month a written report summarizing issuance and expiration dates of Letters of Credit issued by such Issuing Bank during the preceding month and drawings during such month under all Letters of Credit issued by such Issuing Bank and (ii) to the Administrative Agent and each Lender on the first Business Day of each calendar quarter a written report setting forth the average daily aggregate Available Amount during the preceding calendar quarter of all Letters of Credit issued by such Issuing Bank.

 

(c)                                  Letter of Credit Participations; Drawing and Reimbursement.  (i)  Immediately upon the issuance by the Issuing Bank of any Letter of Credit, the Issuing Bank shall be deemed, and with respect to the Existing Letters of Credit, the Existing Issuing Bank shall be deemed upon the date hereof, to have sold and transferred to each Lender, and each Lender (in its capacity under this Section 2.03(c), a “Participant”) shall be deemed irrevocably and unconditionally to have purchased and received from the Issuing Bank, without recourse or warranty, an undivided interest and participation in such Letter of Credit, to the extent of such Participant’s Pro Rata Share of the Available Amount of such Letter of Credit, each drawing or payment made thereunder and the obligations of the Borrower under this Agreement with respect thereto, and any security therefor or guaranty pertaining thereto.  Upon any change in the Revolving Credit Commitments or the Lenders’ respective Pro Rata Shares pursuant to Section 9.07, it is hereby agreed that, with respect to all outstanding Letters of Credit and unpaid drawings relating thereto, there shall be an automatic adjustment to

 

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the participations pursuant to this Section 2.03(c) to reflect the new Pro Rata Shares of the assignor and assignee Lenders, as the case may be.

 

(ii)                                  In determining whether to pay under any Letter of Credit, the Issuing Bank shall not have any obligation with respect to the other Revolving Credit Lenders other than to confirm that any documents required to be delivered under such Letter of Credit appear to have been delivered and that they appear to substantially comply on their face with the requirements of such Letter of Credit.  Any action taken or omitted to be taken by the Issuing Bank under or in connection with any Letter of Credit issued by it shall not create for the Issuing Bank any resulting liability to the Borrower, any other Loan Party, any Revolving Credit Lender or any other Person unless such action is taken or omitted to be taken with gross negligence or willful misconduct on the part of the Issuing Bank (as determined by a court of competent jurisdiction in a final non-appealable judgment).

 

(iii)                               The payment by any Issuing Bank of a draft drawn under any Letter of Credit shall constitute for all purposes of this Agreement the making by such Issuing Bank of a Letter of Credit Advance, which shall be a Base Rate Advance, in the amount of such draft.  In the event that the Issuing Bank makes any payment under any Letter of Credit issued by it and the Borrower shall not have reimbursed such amount in full to the Issuing Bank pursuant to Section 2.04(c), the Issuing Bank shall promptly notify the Administrative Agent, which shall promptly notify each Participant of such failure, and each Participant shall promptly and unconditionally pay to the Administrative Agent for the account of the Issuing Bank the amount of such Participant’s Pro Rata Share of such unreimbursed payment in U.S. dollars and in same day funds.  Upon such notification by the Administrative Agent to any Participant required to fund a payment under a Letter of Credit, such Participant shall make available to the Administrative Agent for the account of the Issuing Bank its Pro Rata Share of an outstanding Letter of Credit Advance on (i) the Business Day on which demand therefor is made by the Issuing Bank which made such Advance, provided that notice of such demand is given not later than 11:00 A.M. (New York City time) on such Business Day, or (ii) the first Business Day next succeeding such demand if notice of such demand is given after such time.  If such Lender shall pay to the Administrative Agent such amount for the account of such Issuing Bank on any Business Day, such amount so paid in respect of principal shall constitute a Letter of Credit Advance made by such Lender on such Business Day for purposes of this Agreement, and the outstanding principal amount of the Letter of Credit Advance made by such Issuing Bank shall be reduced by such amount on such Business Day.  If and to the extent that any Lender shall not have so made the amount of such Letter of Credit Advance available to the Administrative Agent, such Lender agrees to pay to the Administrative Agent forthwith on demand such amount together with interest thereon, for each day from the date of demand by such Issuing Bank until the date such amount is paid to the Administrative Agent, at the Federal Funds Rate for its account or the account of such Issuing Bank, as applicable.

 

(iv)                              Whenever the Issuing Bank receives a payment of a reimbursement obligation as to which it has received any payments from the Participants pursuant to clause (iii) above, the Issuing Bank shall pay to the Administrative Agent for the account of each such Participant that has paid its Pro Rata Share thereof, in same day funds, an amount equal to such Participant’s share (based upon the proportionate aggregate amount originally funded by such Participant to the aggregate amount funded by all Participants) of the principal amount of such reimbursement obligation and interest thereon accruing after the purchase of the respective participations.

 

(d)                                 Failure to Make Letter of Credit Advances.  The failure of any Lender to make the Letter of Credit Advance to be made by it on the date specified in Section 2.03(c) shall not relieve any other Lender of its obligation hereunder to make its Letter of Credit Advance on such date, but no Lender shall be responsible for the failure of any other Lender to make the Letter of Credit Advance to be made by such other Lender on such date.

 

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(e)                                  Independence.  The Borrower acknowledges that the rights and obligations of the Issuing Bank under each Letter of Credit are independent of the existence, performance or nonperformance of any contract or arrangement underlying such Letter of Credit, including contracts or arrangements between the Issuing Bank and the Borrower and between the Borrower and the beneficiary of such Letter of Credit.

 

(f)                                   Governing Rules.  The Borrower agrees that each Letter of Credit shall be governed by the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce (“ICC”) Publication No. 600 (2007 Revision) or, at the Issuing Bank’s option, such later revision thereof in effect at the time of issuance of such Letter of Credit (as so chosen for such Letter of Credit, the “UCP”) or the International Standby Practices 1998, ICC Publication No. 590 or, at the Issuing Bank’s option, such later revision thereof in effect at the time of issuance of such Letter of Credit (as so chosen for the Letter of Credit, the “ISP”, and each of the UCP and the ISP, an “ICC Rule”).  The UCP and the ISP (or such later revision of either) shall serve, in the absence of proof to the contrary, as evidence of general banking usage with respect to the subject matter thereof.

 

(g)                                  Letters of Credit Issued for Subsidiaries.  Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Subsidiary of the Borrower, the Borrower shall be obligated to reimburse the Issuing Bank hereunder for any and all drawings under such Letter of Credit.  The Borrower hereby acknowledges that the issuance of Letters of Credit for the account of Subsidiaries inures to the benefit of the Borrower, and that the Borrower’s business derives substantial benefits from the businesses of such Subsidiaries.

 

SECTION 2.04                                 Repayment of Advances.  (a)  Revolving Credit Advances.  The Borrower shall repay to the Administrative Agent for the ratable account of the Lenders on the Termination Date the aggregate outstanding principal amount of the Revolving Credit Advances then outstanding.

 

(b)                                 Swing Line Advances.  The Borrower shall repay to the Administrative Agent for the account of (i) the Swing Line Bank and (ii) each other Lender that has made a Swing Line Advance by purchase from the Swing Line Bank pursuant to Section 2.02(b), the outstanding principal amount of each Swing Line Advance made by each of them on the earlier of the maturity date specified in the applicable Notice of Swing Line Borrowing (which maturity shall be no later than the seventh day after the requested date of such Swing Line Borrowing) and the Termination Date.

 

(c)                                  Letter of Credit Advances.  (i)  The Borrower shall repay to the Administrative Agent for the account of each Issuing Bank and each other Lender that has made a Letter of Credit Advance on the same day on which such Advance was made the outstanding principal amount of each Letter of Credit Advance made by each of them.

 

(ii)                                  The Obligations of the Borrower under this Agreement, any Letter of Credit Agreement and any other agreement or instrument relating to any Letter of Credit (and the obligations of each Lender to reimburse the Issuing Bank with respect thereto) shall be unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement, such Letter of Credit Agreement and such other agreement or instrument under all circumstances, including, without limitation, the following circumstances:

 

(A)                               any lack of validity or enforceability of any Loan Document, any Letter of Credit Agreement, any Letter of Credit or any other agreement or instrument relating thereto (all of the foregoing being, collectively, the “L/C Related Documents”);

 

(B)                               any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations of the Borrower in respect of any L/C Related Document or any other amendment or waiver of or any consent to departure from all or any of the L/C Related Documents;

 

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(C)                               the existence of any claim, set-off, defense or other right that the Borrower may have at any time against any beneficiary or any transferee of a Letter of Credit (or any Persons for which any such beneficiary or any such transferee may be acting), any Issuing Bank or any other Person, whether in connection with the transactions contemplated by the L/C Related Documents or any unrelated transaction;

 

(D)                               any statement or any other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;

 

(E)                                payment by any Issuing Bank under a Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit;

 

(F)                                 any exchange, release or non-perfection of any Collateral or other collateral, or any release or amendment or waiver of or consent to departure from the Guaranties or any other guarantee, for all or any of the Obligations of the Borrower in respect of the L/C Related Documents; or

 

(G)                               any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including, without limitation, any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower or any other Loan Party.

 

SECTION 2.05                                 Termination or Reduction of the Commitments.  (a)  Optional.  The Borrower may, upon at least three Business Days’ notice to the Administrative Agent, terminate in whole or reduce in part the unused portions of the Swing Line Facility, the Letter of Credit Facility and the Unused Revolving Credit Commitments; provided, however, that each partial reduction of a Facility (i) shall be in an aggregate amount of $1,000,000 (or, in the case of the Swing Line Facility, $250,000) or an integral multiple of $250,000 in excess thereof and (ii) shall be made ratably among the Lenders in accordance with their Commitments with respect to such Facility.

 

(b)                                 Mandatory.  (i)  The Letter of Credit Facility shall be permanently reduced from time to time on the date of each reduction in the Revolving Credit Facility by the amount, if any, by which the amount of the Letter of Credit Facility exceeds the Revolving Credit Facility after giving effect to such reduction of the Revolving Credit Facility.

 

(ii)                                  The Swing Line Facility shall be permanently reduced from time to time on the date of each reduction in the Revolving Credit Facility by the amount, if any, by which the amount of the Swing Line Facility exceeds the Revolving Credit Facility after giving effect to such reduction of the Revolving Credit Facility.

 

SECTION 2.06                                 Prepayments.  (a)  Optional.  The Borrower may, upon same day notice in the case of Base Rate Advances and two Business Days’ notice in the case of Eurodollar Rate Advances, in each case to the Administrative Agent stating the proposed date and aggregate principal amount of the prepayment, and if such notice is given the Borrower shall, prepay the outstanding aggregate principal amount of the Advances comprising part of the same Borrowing in whole or ratably in part, together with accrued interest to the date of such prepayment on the aggregate principal amount prepaid; provided, however, that (i) each partial prepayment shall be in an aggregate principal amount of $1,000,000 or an integral multiple of $250,000 in excess thereof or, if less, the amount of the Advances outstanding and (ii) if any prepayment of a Eurodollar Rate Advance is made on a date other than the last day of an Interest Period for such Advance, the Borrower shall also pay any amounts owing pursuant to Section 9.04(c).

 

(b)                                 Mandatory.  (i)  The Borrower shall, if applicable, on each Business Day, prepay an aggregate principal amount of the Revolving Credit Advances comprising part of the same Borrowings, the

 

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Swing Line Advances and the Letter of Credit Advances to cause (A) the Facility Exposure not to exceed the Revolving Credit Facility on such Business Day, and (B) the Facility Exposure not to exceed the Total Borrowing Base Value as set forth in Section 5.04(b)(i) on such Business Day.  If all Advances have been prepaid and are not sufficient to cause Borrower to comply with each of (A), and (B), the Borrower shall make a deposit in the L/C Cash Collateral Account in an amount sufficient to do the same.

 

(ii)                                  The Borrower shall, on each Business Day, pay to the Administrative Agent for deposit in the L/C Cash Collateral Account an amount sufficient to cause the aggregate amount on deposit in the L/C Cash Collateral Account to equal the amount by which the aggregate Available Amount of all Letters of Credit then outstanding exceeds the Letter of Credit Facility on such Business Day.  To the extent the funds on deposit in the L/C Cash Collateral Account shall at any time exceed the total amount required to be deposited therein pursuant to the terms of this Agreement, the Administrative Agent shall, promptly upon request by the Borrower and provided that no Default or Event of Default shall then have occurred or be continuing or would result therefrom, return such excess amount to the Borrower.

 

(iii)                               Prepayments of the Revolving Credit Facility made pursuant to clauses (i) and (ii) above shall be first applied to prepay Letter of Credit Advances then outstanding until such Advances are paid in full, second applied to prepay Swing Line Advances then outstanding until such Advances are paid in full, third applied to prepay Revolving Credit Advances then outstanding comprising part of the same Borrowings until such Advances are paid in full and fourth deposited in the L/C Cash Collateral Account to Cash Collateralize 100% of the Available Amount of the Letters of Credit then outstanding.  Upon the drawing of any Letter of Credit for which funds are on deposit in the L/C Cash Collateral Account, such funds shall be applied to reimburse the relevant Issuing Bank or Lenders, as applicable.

 

(iv)                              All prepayments under this subsection (b) shall be made together with accrued interest to the date of such prepayment on the principal amount prepaid.

 

SECTION 2.07                                 Interest.  (a)  Scheduled Interest.  The Borrower shall pay interest on the unpaid principal amount of each Advance owing to each Lender from the date of such Advance until such principal amount shall be paid in full, at the following rates per annum:

 

(i)                                     Base Rate Advances.  During such periods as such Advance is a Base Rate Advance, a rate per annum equal at all times to the sum of (A) the Base Rate in effect from time to time plus (B) the Applicable Margin in respect of Base Rate Advances in effect from time to time, payable in arrears quarterly on the last day of each March, June, September and December during such periods and on the date such Base Rate Advance shall be Converted or paid in full.

 

(ii)                                  Eurodollar Rate Advances.  During such periods as such Advance is a Eurodollar Rate Advance, a rate per annum equal at all times during each Interest Period for such Advance to the sum of (A) the Eurodollar Rate for such Interest Period for such Advance plus (B) the Applicable Margin in respect of Eurodollar Rate Advances in effect on the first day of such Interest Period, payable in arrears on the last day of such Interest Period and, if such Interest Period has a duration of more than three months, on each day that occurs during such Interest Period every three months from the first day of such Interest Period and on the date such Eurodollar Rate Advance shall be Converted or paid in full.

 

(b)                                 Default Interest.  Upon the occurrence and during the continuance of any Event of Default, the Borrower shall pay interest on (i) the unpaid principal amount of each Advance owing to each Lender, payable in arrears on the dates referred to in clause (a)(i) or (a)(ii) above and on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid on such Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) to the fullest extent permitted by law, the amount of any interest, fee or other amount payable under the Loan Documents that is not paid when due, from the date such

 

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amount shall be due until such amount shall be paid in full, payable in arrears on the date such amount shall be paid in full and on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid, in the case of interest, on the Type of Advance on which such interest has accrued pursuant to clause (a)(i) or (a)(ii) above and, in all other cases, on Base Rate Advances pursuant to clause (a)(i) above.

 

(c)                                  Notice of Interest Period and Interest Rate.  Promptly after receipt of a Notice of Borrowing pursuant to Section 2.02(a), a notice of Conversion pursuant to Section 2.09 or a notice of selection of an Interest Period pursuant to the definition of “Interest Period”, the Administrative Agent shall give notice to the Borrower and each Lender of the applicable Interest Period and the applicable interest rate determined by the Administrative Agent for purposes of clause (a)(i) or (a)(ii) above.

 

(d)                                 Interest Rate Determination.  If the Screen Rate is unavailable and the Administrative Agent is unable to determine the Eurodollar Rate for any Eurodollar Rate Advances, as provided in the definition of “Eurodollar Rate” herein,

 

(i)                                     the Administrative Agent shall forthwith notify the Borrower and the Lenders that the interest rate cannot be determined for such Eurodollar Rate Advances,

 

(ii)                                  each such Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance (or if such Advance is then a Base Rate Advance, will continue as a Base Rate Advance), and

 

(iii)                               the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended until the Administrative Agent shall notify the Borrower and the Lenders that the circumstances causing such suspension no longer exist.

 

SECTION 2.08                                 Fees.  (a)  Unused Fee.  The Borrower shall pay to the Administrative Agent for the account of the Lenders an unused commitment fee (the “Unused Fee”), from the date hereof in the case of each Initial Lender and from the effective date specified in the Assignment and Acceptance pursuant to which it became a Lender in the case of each other Lender until the Termination Date, payable in arrears quarterly on the last day of each March, June, September and December, commencing March 31, 2017, and on the Termination Date.  The Unused Fee payable for the account of each Lender shall be calculated for each period for which the Unused Fee is payable on the average daily Unused Revolving Credit Commitment of such Lender during such period at the rate of 0.35% per annum.

 

(b)                                 Letter of Credit Fees, Etc.  (i)  The Borrower shall pay to the Administrative Agent for the account of each Lender a commission, payable in arrears, (a) quarterly on the last day of each March, June, September and December commencing March 31, 2017, (b) on the earliest to occur of the full drawing, expiration, termination or cancellation of any Letter of Credit, and (c) on the Termination Date, on such Lender’s Pro Rata Share of the average daily aggregate Available Amount during such quarter of all Letters of Credit outstanding from time to time for the applicable period at the rate per annum equal to the Applicable Margin for Eurodollar Rate Advances in effect from time to time.

 

(ii)                                  The Borrower shall pay to each Issuing Bank, for its own account, (A) a fronting fee for each Letter of Credit issued by such Issuing Bank in an amount equal to 0.125% of the Available Amount of such Letter of Credit on the date of issuance of such Letter of Credit, payable on such date and (B) such other commissions, issuance fees, transfer fees and other fees and charges in connection with the issuance or administration of each Letter of Credit as the Borrower and such Issuing Bank shall agree.

 

(c)                                  Agents’ Fees.  The Borrower shall pay to each Agent for its own account the fees, in the amounts and on the dates, set forth in the Fee Letter and such other fees as may from time to time be agreed between the Borrower and such Agent.

 

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(d)                                 Extension Fees.  The Borrower shall pay to the Administrative Agent on the First Extension Date and the Second Extension Date, for the account of each Lender, a Facility extension fee, in an amount equal to 0.20% of each Lender’s Revolving Credit Commitment then outstanding (each, an “Extension Fee”).

 

(e)                                  Defaulting Lender.  Anything herein to the contrary notwithstanding, during such period as a Lender is a Defaulting Lender, such Defaulting Lender will not be entitled to any fees accruing during such period pursuant to Section 2.08(a), Section 2.08(b) and Section 2.08(d) (without prejudice to the rights of the Non-Defaulting Lenders in respect of such fees), provided that (a) to the extent that all or a portion of the Letter of Credit Exposure or the Swing Line Exposure of such Defaulting Lender is reallocated to the Non-Defaulting Lenders pursuant to Section 2.17(b), such fees that would have accrued for the benefit of such Defaulting Lender will instead accrue for the benefit of and be payable to such Non-Defaulting Lenders, pro rata in accordance with their respective Commitments, and (b) to the extent that all or any portion of such Letter of Credit Exposure or Swing Line Exposure cannot be so reallocated, such fees will instead accrue for the benefit of and be payable to the Issuing Bank and the Swing Line Bank, as applicable (and the pro rata payment provisions of Section 2.11(f) will automatically be deemed adjusted to reflect the provisions of this Section).

 

SECTION 2.09                                 Conversion of Advances.  (a)  Optional.  The Borrower may on any Business Day, upon notice given to the Administrative Agent not later than 12:00 Noon (New York City time) on the third Business Day prior to the date of the proposed Conversion and subject to the provisions of Sections 2.07 and 2.10, Convert all or any portion of the Advances of one Type comprising the same Borrowing into Advances of the other Type; provided, however, that any Conversion of Eurodollar Rate Advances into Base Rate Advances shall be made only on the last day of an Interest Period for such Eurodollar Rate Advances, any Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in an amount not less than the minimum amount specified in Section 2.02(c), no Conversion of any Advances shall result in more separate Borrowings than permitted under Section 2.02(c) and each Conversion of Advances comprising part of the same Borrowing under any Facility shall be made ratably among the Lenders in accordance with their Commitments under such Facility.  Each such notice of Conversion shall, within the restrictions specified above, specify (i) the date of such Conversion, (ii) the Advances to be Converted and (iii) if such Conversion is into Eurodollar Rate Advances, the duration of the initial Interest Period for such Advances.  Each notice of Conversion shall be irrevocable and binding on the Borrower.

 

(b)                                 Mandatory.  (i)  On the date on which the aggregate unpaid principal amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced, by payment or prepayment or otherwise, to less than $1,000,000, such Advances shall automatically Convert into Base Rate Advances.

 

(ii)                                  If the Borrower shall fail to select the duration of any Interest Period for any Eurodollar Rate Advances in accordance with the provisions contained in the definition of “Interest Period” in Section 1.01, the Administrative Agent will forthwith so notify the Borrower and the Lenders, whereupon the Borrower will be deemed to have elected to continue such Eurodollar Rate Advances as Eurodollar Rate Advances with a one-month Interest Period.

 

(iii)                               Upon the occurrence and during the continuance of any Event of Default, (y) each Eurodollar Rate Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance and (z) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended.

 

SECTION 2.10                                 Increased Costs, Etc.  (a)  If, due to either (i) the introduction of or any change in or in the interpretation or application of any law or regulation which change or interpretation is enacted, adopted or issued after the date hereof or (ii) the compliance with any guideline or request from any central bank or other Governmental Authority adopted, issued or made after the date hereof (whether or not having the force of law), there shall be any increase in the cost to any Lender Party of agreeing to make or of making, funding or maintaining Eurodollar Rate Advances or of agreeing to issue or of issuing or maintaining

 

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or participating in Letters of Credit or of agreeing to make or of making or maintaining Letter of Credit Advances (excluding, for purposes of this Section 2.10, any such increased costs resulting from Indemnified Taxes, Taxes described in clauses (b) through (d) of the definition of “Excluded Taxes” or Connection Income Taxes (as to which Section 2.12 shall govern), then the Borrower shall from time to time, upon demand by such Lender Party (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender Party additional amounts sufficient to compensate such Lender Party for such increased cost; provided, however, that a Lender Party claiming additional amounts under this Section 2.10(a) agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different Applicable Lending Office if the making of such a designation would avoid the need for, or reduce the amount of, such increased cost that may thereafter accrue and would not, in the reasonable judgment of such Lender Party, be otherwise disadvantageous to such Lender Party.  A certificate as to the amount of such increased cost, submitted to the Borrower by such Lender Party, shall be conclusive and binding for all purposes, absent manifest error.

 

(b)                                 If any Lender Party determines that compliance with any law or regulation or any guideline or request from any central bank or other Governmental Authority enacted, adopted, issued or made after the date hereof (whether or not having the force of law) affects or would affect the amount of capital or liquidity required or expected to be maintained by such Lender Party or any corporation controlling such Lender Party and that the amount of such capital or liquidity is increased by or based upon the existence of such Lender Party’s commitment to lend or to issue or participate in Letters of Credit hereunder and other commitments of such type or the issuance or maintenance of or participation in the Letters of Credit (or similar contingent obligations), then, upon demand by such Lender Party or such corporation (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender Party, from time to time as specified by such Lender Party, additional amounts sufficient to compensate such Lender Party in the light of such circumstances, to the extent that such Lender Party reasonably determines such increase in capital or liquidity to be allocable to the existence of such Lender Party’s commitment to lend or to issue or participate in Letters of Credit hereunder or to the issuance or maintenance of or participation in any Letters of Credit.  A certificate as to such amounts submitted to the Borrower by such Lender Party shall be conclusive and binding for all purposes, absent manifest error.

 

Notwithstanding anything to the contrary contained in this Agreement, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as amended, and all requests, rules, guidelines or directives thereunder or issued in connection therewith, in each case regardless of the date enacted, adopted, implemented or issued, and all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, or the Basel Committee on Banking Supervision (or any successor or similar authority) or United States or foreign regulatory authorities, in each case pursuant to Basel Supervision known as Basel III and regardless of the date enacted, adopted, implemented or issued, shall be deemed an introduction or change of the type referred to in Section 2.10(a) and this Section 2.10(b).

 

(c)                                  If, with respect to any Eurodollar Rate Advances, the Required Lenders notify the Administrative Agent that the Eurodollar Rate for any Interest Period for such Advances will not adequately reflect the cost to such Lenders of making, funding or maintaining their Eurodollar Rate Advances for such Interest Period, the Administrative Agent shall forthwith so notify the Borrower and the Lenders, whereupon (i) each such Eurodollar Rate Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance and (ii) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended until the Administrative Agent shall notify the Borrower that such Lenders have determined that the circumstances causing such suspension no longer exist.

 

(d)                                 Notwithstanding any other provision of this Agreement, if the introduction of or any change in or in the interpretation or application of any law or regulation shall make it unlawful, or any central bank or other Governmental Authority shall assert that it is unlawful, for any Lender or its Eurodollar Lending Office to perform its obligations hereunder to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder, then, on notice thereof and demand therefor by such Lender to the Borrower through the Administrative Agent, (i) each Eurodollar Rate Advance will automatically, upon

 

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such demand, Convert into a Base Rate Advance and (ii) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended until the Administrative Agent shall notify the Borrower that such Lender has determined that the circumstances causing such suspension no longer exist; provided, however, that, before making any such demand, such Lender agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different Eurodollar Lending Office if the making of such a designation would allow such Lender or its Eurodollar Lending Office to continue to perform its obligations to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate Advances and would not, in the judgment of such Lender, be otherwise disadvantageous to such Lender.

 

(e)                                  Failure or delay on the part of any Lender Party or Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender Party’s or Issuing Bank’s right to demand such compensation; provided, however, that the Borrower shall not be required to compensate a Lender Party or Issuing Bank pursuant to this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Lender Party or Issuing Bank, as the case may be, notifies the Borrower of the introduction or change of the type referred to in clause (a) above giving rise to such increased costs or reductions, and of such Lender Party’s or Issuing Bank’s intention to claim compensation therefor (except that, if such introduction or change giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

 

SECTION 2.11                                 Payments and Computations.  (a)  The Borrower shall make each payment hereunder and under the Notes, irrespective of any right of counterclaim or set-off (except as otherwise provided in Section 2.13), not later than 12:00 Noon (New York City time) on the day when due in U.S. dollars to the Administrative Agent at the Administrative Agent’s Account in same day funds, with payments being received by the Administrative Agent after such time being deemed to have been received on the next succeeding Business Day.  The Administrative Agent shall promptly thereafter cause like funds to be distributed (i) if such payment by the Borrower is in respect of principal, interest, commitment fees or any other Obligation then payable hereunder and under the Notes to more than one Lender Party, to such Lender Parties for the account of their respective Applicable Lending Offices ratably in accordance with the amounts of such respective Obligations then payable to such Lender Parties and (ii) if such payment by the Borrower is in respect of any Obligation then payable hereunder to one Lender Party, to such Lender Party for the account of its Applicable Lending Office, in each case to be applied in accordance with the terms of this Agreement.  Upon any Acceding Lender becoming a Lender hereunder as a result of a Commitment Increase pursuant to Section 2.19 and upon the Administrative Agent’s receipt of such Lender’s Accession Agreement and recording of information contained therein in the Register, from and after the applicable Increase Date, the Administrative Agent shall make all payments hereunder and under any Notes issued in connection therewith in respect of the interest assumed thereby to such Acceding Lender.  Upon its acceptance of an Assignment and Acceptance and recording of the information contained therein in the Register pursuant to Section 9.07(d), from and after the effective date of such Assignment and Acceptance, the Administrative Agent shall make all payments hereunder and under the Notes in respect of the interest assigned thereby to the Lender Party assignee thereunder, and the parties to such Assignment and Acceptance shall make all appropriate adjustments in such payments for periods prior to such effective date directly between themselves.

 

(b)                                 The Borrower hereby authorizes each Lender Party and each of its Affiliates, if and to the extent payment owed to such Lender Party is not made when due hereunder or, in the case of a Lender, under the Note held by such Lender, to charge from time to time, to the fullest extent permitted by law, against any or all of the Borrower’s accounts with such Lender Party any amount so due.

 

(c)                                  All computations of interest based on Citibank’s base rate shall be made by the Administrative Agent on the basis of a year of 365 or 366 days, as the case may be, and all computations of interest based on the Eurodollar Rate or the Federal Funds Rate and of fees and Letter of Credit commissions shall be made by the Administrative Agent on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such

 

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interest, fees or commissions are payable.  Each determination by the Administrative Agent of an interest rate, fee or commission hereunder shall be conclusive and binding for all purposes, absent manifest error.

 

(d)                                 Whenever any payment hereunder or under the Notes shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or commitment fee, as the case may be; provided, however, that if such extension would cause payment of interest on or principal of Eurodollar Rate Advances to be made in the next following calendar month, such payment shall be made on the next preceding Business Day.

 

(e)                                  Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to any Lender Party hereunder that the Borrower will not make such payment in full, the Administrative Agent may assume that the Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon such assumption, cause to be distributed to each such Lender Party on such due date an amount equal to the amount then due such Lender Party.  If and to the extent the Borrower shall not have so made such payment in full to the Administrative Agent, each such Lender Party shall repay to the Administrative Agent forthwith on demand such amount distributed to such Lender Party together with interest thereon, for each day from the date such amount is distributed to such Lender Party until the date such Lender Party repays such amount to the Administrative Agent, at the Federal Funds Rate.

 

(f)                                   Whenever any payment received by the Administrative Agent under this Agreement or any of the other Loan Documents is insufficient to pay in full all amounts due and payable to the Agents and the Lender Parties under or in respect of this Agreement and the other Loan Documents on any date, such payment shall be distributed by the Administrative Agent and applied by the Agents and the Lender Parties in the following order of priority:

 

(i)                                     first, to the payment of all of the fees, indemnification payments, costs and expenses that are due and payable to the Agents (solely in their respective capacities as Agents) under or in respect of this Agreement and the other Loan Documents on such date, ratably based upon the respective aggregate amounts of all such fees, indemnification payments, costs and expenses owing to the Agents on such date;

 

(ii)                                  second, to the payment of all of the fees, indemnification payments, costs and expenses that are due and payable to the Issuing Banks (solely in their respective capacities as such) under or in respect of this Agreement and the other Loan Documents on such date, ratably based upon the respective aggregate amounts of all such fees, indemnification payments, costs and expenses owing to the Issuing Banks on such date;

 

(iii)                               third, to the payment of all of the indemnification payments, costs and expenses that are due and payable to the Lenders under Section 9.04, the Security Agreement and any similar section of any of the other Loan Documents on such date, ratably based upon the respective aggregate amounts of all such indemnification payments, costs and expenses owing to the Lenders on such date;

 

(iv)                              fourth, to the payment of all of the amounts that are due and payable to the Administrative Agent and the Lender Parties under Sections 2.10 and 2.12 on such date, ratably based upon the respective aggregate amounts thereof owing to the Administrative Agent and the Lender Parties on such date;

 

(v)                                 fifth, to the payment of all of the fees that are due and payable to the Lenders under Section 2.08 (a), (b)(i) and (d) on such date, ratably based upon the respective aggregate Commitments of the Lenders under the Facilities on such date;

 

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(vi)                              sixth, to the payment of all of the accrued and unpaid interest on the Obligations of the Borrower under or in respect of the Loan Documents that is due and payable to the Administrative Agent and the Lender Parties under Section 2.07(b) on such date, ratably based upon the respective aggregate amounts of all such interest owing to the Administrative Agent and the Lender Parties on such date;

 

(vii)                           seventh, to the payment of all of the accrued and unpaid interest on the Advances that is due and payable to the Administrative Agent and the Lender Parties under Section 2.07(a) on such date, ratably based upon the respective aggregate amounts of all such interest owing to the Administrative Agent and the Lender Parties on such date;

 

(viii)                        eighth, to the payment of any other accrued and unpaid interest comprising Obligations under the Loan Documents that is due and payable to the Administrative Agent and the Lender Parties on such date, ratably based upon the respective aggregate amounts of all such interest owing to the Administrative Agent and the Lender Parties on such date;

 

(ix)                              ninth, to the payment of the principal amount of all of the outstanding Advances that are due and payable to the Administrative Agent and the Lender Parties on such date, ratably based upon the respective aggregate amounts of all such principal and reimbursement obligations owing to the Administrative Agent and the Lender Parties on such date, and to deposit into the L/C Cash Collateral Account any contingent reimbursement obligations in respect of outstanding Letters of Credit to the extent required by Section 6.02; and

 

(x)                                 tenth, to the payment of all other Obligations of the Loan Parties owing under or in respect of the Loan Documents that are due and payable to the Administrative Agent and the other Secured Parties on such date, ratably based upon the respective aggregate amounts of all such Obligations owing to the Administrative Agent and the other Secured Parties on such date.

 

SECTION 2.12                                 Taxes.  (a)  Any and all payments by or on account of any Obligation of any Loan Party or any Agent hereunder or under any Loan Document shall be made, in accordance with Section 2.11 or the applicable provisions of such other Loan Document, if any, without deduction or withholding for any Taxes, except as required by applicable law.  If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law, and if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

 

(b)                                 Each Loan Party shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

 

(c)                                  Without duplication of Sections 2.12(a) or 2.12(b), the Loan Parties shall indemnify each Recipient for the full amount of Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 2.12) payable or paid by such Recipient, or required to be deducted or withheld from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to the Loan Parties by a Lender Party (with a copy to the Administrative Agent), or by an Agent on its own behalf or on behalf of a Lender Party, shall be conclusive absent manifest error.  This indemnification shall be made

 

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within ten days from the date such Lender Party or such Agent (as the case may be) makes written demand therefor.

 

(d)                                 Each Lender Party shall severally indemnify the Agents, within ten days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender Party (but only to the extent that any Loan Party has not already indemnified the Agents for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender Party’s failure to comply with the provisions of Section 10.07 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender Party, in each case that are payable or paid by the Agents in connection with any Loan Document and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to any Lender Party by an Agent shall be conclusive absent manifest error.  Each Lender Party hereby authorizes each Agent to set off and apply any and all amounts at any time owing to such Lender Party under any Loan Document or otherwise payable by such Agent to such Lender Party from any other source against any amount due to such Agent under this Section 2.12(d).

 

(e)                                  As soon as practicable after, but in any case within 30 days after, the date of any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 2.12, such Loan Party shall deliver to the Administrative Agent, at its address referred to in Section 10.02, the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.  In the case of any payment hereunder or under the other Loan Documents by or on behalf of a Loan Party through an account or branch outside the United States or by or on behalf of a Loan Party by a payor that is not a U.S. Person, if such Loan Party determines that no Taxes are payable in respect thereof, such Loan Party shall furnish, or shall cause such payor to furnish, to the Administrative Agent, at such address, an opinion of counsel acceptable to the Administrative Agent stating that such payment is exempt from Taxes.  For purposes of subsections (e) and (g) of this Section 2.12, the term “United States” shall have the meaning specified in Section 7701(a)(9) of the Internal Revenue Code.

 

(f)                                   Any Lender Party that is entitled to an exemption from, or reduction of, withholding Taxes with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding.  In addition, any Lender Party, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by any applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender Party is subject to backup withholding or information reporting requirements.  Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.12(g)(i), (ii) and  (iv) below) shall not be required if in the applicable Lender Party’s reasonable judgment such completion, execution or submission would subject such Lender Party to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender Party.

 

(g)                                  Without limiting the generality of Section 2.12(f),

 

(i)                                     each Lender Party that is a U.S. Person shall, to the extent it is legally entitled to do so, on or prior to the date of its execution and delivery of this Agreement in the case of each Initial Lender Party, and on the date of the Assignment and Acceptance pursuant to which it becomes a Lender Party in the case of each other Lender Party, and from time to time thereafter as reasonably requested in writing by the Borrower (but only so long thereafter as such Lender Party remains lawfully able to do so), provide the Administrative Agent and the Borrower with executed

 

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originals of Internal Revenue Service Form W-9 certifying that such Lender Party is exempt from U.S. federal backup withholding tax;

 

(ii)                                  each Lender Party that is not a U.S. Person (a “Foreign Lender Party”) shall, to the extent it is legally entitled to do so, on or prior to the date of its execution and delivery of this Agreement in the case of each Initial Lender Party, and on the date of the Assignment and Acceptance pursuant to which it becomes a Lender Party in the case of each other Lender Party, and from time to time thereafter as reasonably requested in writing by the Borrower (but only so long thereafter as such Lender Party remains lawfully able to do so), provide the Administrative Agent and the Borrower with whichever of the following is applicable:

 

(A)                               in the case of a Foreign Lender Party that is eligible to claim the benefits of an income tax treaty to which the United States is a party, (x) with respect to payments of interest under any Loan Document, executed originals of Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

 

(B)                               executed originals of Internal Revenue Service Form W-8ECI;

 

(C)                               in the case of a Foreign Lender Party that is eligible to claim the benefits of the exemption for portfolio interest under Section 881(c) of the Internal Revenue Code (x) a certificate substantially in the form of Exhibit I-1 hereto to the effect that such Foreign Lender Party is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (B) a “10 percent shareholder” of any Loan Party within the meaning of Section 881(c)(3)(B) of the Internal Revenue Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Internal Revenue Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable; or

 

(D)                               to the extent that the Foreign Lender Party is not the beneficial owner, executed originals of Internal Revenue Service Form W-8IMY, accompanied by Internal Revenue Service Form W-8BEN or  W-8BEN-E,  as  applicable,  a  U.S.  Tax  Compliance  Certificate  substantially  in  the  form  of  Exhibit I-2  or  Exhibit I-3, Internal Revenue Service Form W-9 and/or other certification documents from each beneficial owner eligible to provide such forms or documentation; provided, however, that if the Foreign Lender Party is a partnership and one or more direct or indirect partners of such Foreign Lender Party are claiming the portfolio interest exemption, such Foreign Lender Party may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit I-4 on behalf of each such direct and indirect partner;

 

(iii)                               any Foreign Lender Party shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the Recipient) on or prior to the date on which such Foreign Lender Party becomes a Lender Party under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by any applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by any applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

 

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(iv)                              if a payment made to a Lender Party under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender Party were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Internal Revenue Code, as applicable), such Lender Party shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Internal Revenue Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender Party has complied with such Lender Party’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for the purposes of this subsection (g), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.  For purposes of determining withholding Taxes under FATCA, from and after the effective date of this Agreement, the Borrower and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to treat) this Agreement as not qualifying as a “grandfathered obligation” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).

 

(v)                                 Each Lender Party agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect (including, for the avoidance of doubt, upon a change in law, or in the interpretation or application thereof, occurring after the date on which a form, certification or other document originally was required to be provided), it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

 

(h)                                 If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has received an indemnification payment pursuant to this Section 2.12 (including by the payment of additional amounts pursuant to this Section 2.12), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out of pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund).  Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this subsection (h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority), or the relevant portion thereof, in the event that such indemnified party is required to repay such refund, or a portion of such refund, to such Governmental Authority.  Notwithstanding anything to the contrary in this subsection (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this subsection (h) if such payment would place the indemnified party in a less favorable net after Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid.  This subsection shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.  No party shall have any obligation to pursue, or any right to assert, any refund of Indemnified Taxes that may be paid by another party.

 

(i)                                     For any period with respect to which a Lender Party has failed to provide the Borrower with the appropriate form or other document described in subsection (f) or subsection (g) above (other than if such failure is due to a change in law, or in the interpretation or application thereof, occurring after the date on which a form or other document originally was required to be provided or if such form or other document otherwise is not required under subsection (f) or subsection (g) above), such Lender Party shall not be entitled to indemnification under subsection (a) or (c) of this Section 2.12 with respect to Taxes imposed by the United States by reason of such failure; provided, however, that should a Lender Party become subject to Taxes because of its failure to deliver a form or other document required hereunder, the Loan Parties

 

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shall take such steps as such Lender Party shall reasonably request to assist such Lender Party to recover such Taxes.

 

(j)                                    Any Lender Party claiming any additional amounts payable pursuant to this Section 2.12 agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to change the jurisdiction of its Applicable Lending Office if the making of such a change would avoid the need for, or reduce the amount of, any such additional amounts that may thereafter accrue and would not, in the reasonable judgment of such Lender Party, be otherwise disadvantageous to such Lender Party.

 

(k)                                 In the event that an additional payment is made under Section 2.12(a) or (c) for the account of any Lender Party and such Lender Party, in its sole discretion, determines that it has finally and irrevocably received or been granted a credit against or release or remission for, or repayment of, any tax paid or payable by it in respect of or calculated with reference to the deduction or withholding giving rise to such payment, such Lender Party shall, to the extent that it determines that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment, pay to the applicable Loan Party such amount as such Lender Party shall, in its sole discretion, have determined to be attributable to such deduction or withholding and which will leave such Lender Party (after such payment) in no worse position than it would have been in if the applicable Loan Party had not been required to make such deduction or withholding.  Nothing herein contained shall interfere with the right of a Lender Party to arrange its tax affairs in whatever manner it thinks fit nor oblige any Lender Party to claim any tax credit or to disclose any information relating to its affairs or any computations in respect thereof, and no Loan Party shall be entitled to review the tax records of any Lender Party or the Administrative Agent, or require any Lender Party to do anything that would prejudice its ability to benefit from any other credits, reliefs, remissions or repayments to which it may be entitled.

 

(l)                                     Without prejudice to the survival of any other agreement of any party hereunder or under any other Loan Document, the agreements and obligations under this Section 2.12 shall survive the resignation or replacement of any Agent, the assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the payment in full of principal, interest and all other amounts payable hereunder and under any of the other Loan Documents.

 

SECTION 2.13                                 Sharing of Payments, Etc.  Subject to the provisions of Section 2.11(f), if any Lender Party shall obtain at any time any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise, other than as a result of an assignment pursuant to Section 9.07) (a) on account of Obligations due and payable to such Lender Party hereunder and under the Notes at such time in excess of its ratable share (according to the proportion of (i) the amount of such Obligations due and payable to such Lender Party at such time to (ii) the aggregate amount of the Obligations due and payable to all Lender Parties hereunder and under the Notes at such time) of payments on account of the Obligations due and payable to all Lender Parties hereunder and under the Notes at such time obtained by all the Lender Parties at such time or (b) on account of Obligations owing (but not due and payable) to such Lender Party hereunder and under the Notes at such time in excess of its ratable share (according to the proportion of (i) the amount of such Obligations owing to such Lender Party at such time to (ii) the aggregate amount of the Obligations owing (but not due and payable) to all Lender Parties hereunder and under the Notes at such time) of payments on account of the Obligations owing (but not due and payable) to all Lender Parties hereunder and under the Notes at such time obtained by all of the Lender Parties at such time, such Lender Party shall forthwith purchase from the other Lender Parties such interests or participating interests in the Obligations due and payable or owing to them, as the case may be, as shall be necessary to cause such purchasing Lender Party to share the excess payment ratably with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Lender Party, such purchase from each other Lender Party shall be rescinded and such other Lender Party shall repay to the purchasing Lender Party the purchase price to the extent of such Lender Party’s ratable share (according to the proportion of (i) the purchase price paid to such Lender Party to (ii) the aggregate purchase price paid to all Lender Parties) of such recovery together with an amount equal to such Lender Party’s ratable share (according to the proportion of (i) the amount of such other Lender Party’s required repayment to (ii) the total amount so recovered from the

 

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purchasing Lender Party) of any interest or other amount paid or payable by the purchasing Lender Party in respect of the total amount so recovered.  The Borrower agrees that any Lender Party so purchasing an interest or participating interest from another Lender Party pursuant to this Section 2.13 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off) with respect to such interest or participating interest, as the case may be, as fully as if such Lender Party were the direct creditor of the Borrower in the amount of such interest or participating interest, as the case may be.

 

SECTION 2.14                                 Use of Proceeds.  The proceeds of the Advances and issuances of Letters of Credit shall be available (and the Borrower agrees that it shall use such proceeds and Letters of Credit) solely for (i) general corporate purposes of the Borrower and its Subsidiaries, (ii) the acquisition or development of new, and the renovation or expansion of existing, Healthcare Assets and the acquisition of such other assets and the making of such other Investments as are permitted by this Agreement, (iii) capital expenditures relating to Healthcare Assets, (iv) the repayment (or refinancing) of Debt, and (v) the payment of fees and expenses related to the Facilities and the other transactions contemplated by the Loan Documents.  The Borrower will not directly or indirectly use the Letters of Credit or the proceeds of the Advances, or lend, contribute or otherwise make available to any Subsidiary, joint venture partner or other Person such extensions of credit or proceeds, (A) to fund any activities or businesses of or with any Person, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions, or (B) in any other manner that would result in a violation of Sanctions by any Person (including any Person participating in the Facility, whether as underwriter, advisor, investor, or otherwise) or any Anti-Corruption Laws.

 

SECTION 2.15                                 Evidence of Debt.  (a)  Each Lender Party shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender Party resulting from each Advance owing to such Lender Party from time to time, including the amounts of principal and interest payable and paid to such Lender Party from time to time hereunder.  The Borrower agrees that upon notice by any Lender Party to the Borrower (with a copy of such notice to the Administrative Agent) to the effect that a promissory note or other evidence of indebtedness is required or appropriate in order for such Lender Party to evidence (whether for purposes of pledge, enforcement or otherwise) the Advances owing to, or to be made by, such Lender Party, the Borrower shall promptly execute and deliver to such Lender Party, with a copy to the Administrative Agent, a Note, in substantially the form of Exhibit A hereto, payable to the order of such Lender Party in a principal amount equal to the Revolving Credit Commitment of such Lender Party.  All references to Notes in the Loan Documents shall mean Notes, if any, to the extent issued hereunder.  To the extent no Note has been issued to a Lender Party, this Agreement shall be deemed to comprise conclusive evidence for all purposes of the indebtedness resulting from the Advances and extensions of credit hereunder.

 

(b)                                 The Register maintained by the Administrative Agent pursuant to Section 9.07(d) shall include a control account, and a subsidiary account for each Lender Party, in which accounts (taken together) shall be recorded (i) the date and amount of each Borrowing made hereunder, the Type of Advances comprising such Borrowing and, if appropriate, the Interest Period applicable thereto, (ii) the terms of each Assignment and Acceptance delivered to and accepted by it, (iii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender Party hereunder, and (iv) the amount of any sum received by the Administrative Agent from the Borrower hereunder and each Lender Party’s share thereof.

 

(c)                                  Entries made in good faith by the Administrative Agent in the Register pursuant to subsection (b) above, and by each Lender Party in its account or accounts pursuant to subsection (a) above, shall be prima facie evidence of the amount of principal and interest due and payable or to become due and payable from the Borrower to, in the case of the Register, each Lender Party and, in the case of such account or accounts, such Lender Party, under this Agreement, absent manifest error; provided, however, that the failure of the Administrative Agent or such Lender Party to make an entry, or any finding that an entry is incorrect, in the Register or such account or accounts shall not limit or otherwise affect the obligations of the Borrower under this Agreement.

 

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SECTION 2.16                                 Extensions of Termination Date.  (a)  At least 30 days but not more than 90 days prior to the Termination Date, the Borrower, by written notice to the Administrative Agent, may request, with respect to the Commitments then outstanding, a single one-year extension of the initial Termination Date.  The Administrative Agent shall promptly notify each Lender of such request and the Termination Date in effect at such time shall, effective as at the Termination Date (the “First Extension Date”), be extended for an additional one year period, provided that the Borrower shall have paid the Extension Fee as described in Section 2.08(d) and on the First Extension Date the following statements shall be true and the Administrative Agent shall have received for the account of each Lender Party a certificate signed by a Responsible Officer of the Borrower, dated the First Extension Date, stating that:  (i) the representations and warranties contained in Section 4.01 are true and correct on and as of the First Extension Date (except those that expressly relate to prior periods, which shall remain true as of the prior date), (ii) no Default or Event of Default has occurred and is continuing or would result from such extension, and (iii) the Loan Parties are in compliance with the covenants contained in Section 5.04 immediately before and, on a pro forma basis, immediately after the extension, together with supporting information demonstrating such compliance.  In the event that an extension is effected pursuant to this Section 2.16(a) (but subject to the provisions of Sections 2.05, 2.06 and 6.01), the aggregate principal amount of all Advances shall be repaid in full ratably to the Lenders on the Termination Date as so extended.  As of the First Extension Date, any and all references in this Agreement, the Notes, if any, or any of the other Loan Documents to the “Termination Date” shall refer to the Termination Date as so extended.

 

(b)                                 Provided that the initial Termination Date has been extended in accordance with Section 2.16(a), at least 30 days but not more than 90 days prior to the Termination Date as extended in accordance with Section 2.16(a), the Borrower, by written notice to the Administrative Agent, may request, with respect to the Commitments then outstanding, a single one-year extension of such Termination Date.  The Administrative Agent shall promptly notify each Lender of such request and the Termination Date in effect at such time shall, effective as at such Termination Date (the “Second Extension Date”), be extended for an additional one year period, provided that the Borrower shall have paid the Extension Fees as described in Section 2.08(d) and on the Second Extension Date the following statements shall be true and the Administrative Agent shall have received for the account of each Lender Party a certificate signed by a Responsible Officer of the Borrower, dated the Second Extension Date, stating that:  (i) the representations and warranties contained in Section 4.01 are true and correct on and as of the Second Extension Date (except those that expressly relate to prior periods, which shall remain true as of the prior date), (ii) no Default or Event of Default has occurred and is continuing or would result from such extension, and (iii) the Loan Parties are in compliance with the covenants contained in Section 5.04 immediately before and, on a pro forma basis, immediately after the extension, together with supporting information demonstrating such compliance.  In the event that an extension is effected pursuant to this Section 2.16(b) (but subject to the provisions of Sections 2.05, 2.06 and 6.01), the aggregate principal amount of all Advances shall be repaid in full ratably to the Lenders on the Termination Date as so extended.  As of the Second Extension Date, any and all references in this Agreement, the Notes, if any, or any of the other Loan Documents to the “Termination Date” shall refer to the Termination Date as so extended.

 

SECTION 2.17                                 Defaulting Lenders.  (a)  If a Lender becomes, and during the period it remains, a Defaulting Lender or a Potential Defaulting Lender, if any Letter of Credit or Swing Line Advance is at the time outstanding, the Issuing Bank and the Swing Line Bank, as the case may be, may (except, in the case of a Defaulting Lender, to the extent the Commitments have been fully reallocated pursuant to Section 2.17(b)), by notice to the Borrower and such Defaulting Lender or Potential Defaulting Lender through the Administrative Agent, require the Borrower to Cash Collateralize the obligations of the Borrower to the Issuing Bank and the Swing Line Bank in respect of such Letter of Credit or Swing Line Advance in amount at least equal to the aggregate amount of the unreallocated obligations (contingent or otherwise) of such Defaulting Lender or such Potential Defaulting Lender to be applied pro rata in respect thereof, or to make other arrangements satisfactory to the Administrative Agent, and to the Issuing Bank and the Swing Line Bank, as the case may be, in their sole discretion to protect them against the risk of non-payment by such Defaulting Lender or Potential Defaulting Lender.

 

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(b)                                 If a Lender becomes, and during the period it remains, a Defaulting Lender, the following provisions shall apply with respect to any outstanding Letter of Credit Exposure and any outstanding Swing Line Exposure of such Defaulting Lender:

 

(i)                                     the Letter of Credit Exposure and the Swing Line Exposure of such Defaulting Lender will, subject to the limitation in the first proviso below, automatically be reallocated (effective on the day such Lender becomes a Defaulting Lender) among the Non-Defaulting Lenders pro rata in accordance with their respective Commitments; provided that (a) the sum of each Non-Defaulting Lender’s total Revolving Credit Exposure, total Swing Line Exposure and total Letter of Credit Exposure may not in any event exceed the Commitment of such Non-Defaulting Lender as in effect at the time of such reallocation and (b) neither such reallocation nor any payment by a Non-Defaulting Lender pursuant thereto will constitute a waiver or release of any claim the Borrower, the Administrative Agent, the Issuing Bank, the Swing Line Bank or any other Lender may have against such Defaulting Lender or cause such Defaulting Lender to be a Non-Defaulting Lender;

 

(ii)                                  to the extent that any portion (the “unreallocated portion”) of the Defaulting Lender’s Letter of Credit Exposure and Swing Line Exposure cannot be so reallocated, whether by reason of the first proviso in clause (i) above or otherwise, the Borrower will, not later than three (3) Business Days after demand by the Administrative Agent (at the direction of the Issuing Bank and/or the Swing Line Bank, as the case may be), (a) Cash Collateralize the obligations of the Borrower to the Issuing Bank and the Swing Line Bank in respect of such Letter of Credit Exposure or Swing Line Exposure, as the case may be, in an amount at least equal to the aggregate amount of the unreallocated portion of such Letter of Credit Exposure or Swing Line Exposure, or (b) in the case of such Swing Line Exposure, prepay (subject to clause (c) below) and/or Cash Collateralize in full the unreallocated portion thereof, or (c) make other arrangements satisfactory to the Administrative Agent, and to the Issuing Bank and the Swing Line Bank, as the case may be, in their sole discretion to protect them against the risk of non-payment by such Defaulting Lender; and

 

(iii)                               any amount paid by the Borrower or otherwise received by the Administrative Agent for the account of a Defaulting Lender under this Agreement (whether on account of principal, interest, fees, indemnity payments or other amounts) will not be paid or distributed to such Defaulting Lender, but will instead be retained by the Administrative Agent in a segregated non-interest bearing account until (subject to Section 2.17(f)) the termination of the Commitments and payment in full of all obligations of the Borrower hereunder and will be applied by the Administrative Agent, to the fullest extent permitted by law, to the making of payments from time to time in the following order of priority:  first to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent under this Agreement, second to the payment of any amounts owing by such Defaulting Lender to the Issuing Bank or the Swing Line Bank (pro rata as to the respective amounts owing to each of them) under this Agreement, third to the payment of post-default interest and then current interest due and payable to the Lenders hereunder other than Defaulting Lenders, ratably among them in accordance with the amounts of such interest then due and payable to them, fourth to the payment of fees then due and payable to the Non-Defaulting Lenders hereunder, ratably among them in accordance with the amounts of such fees then due and payable to them, fifth to pay principal and unreimbursed Letter of Credit Advances then due and payable to the Non-Defaulting Lenders hereunder ratably in accordance with the amounts thereof then due and payable to them, sixth to the ratable payment of other amounts then due and payable to the Non-Defaulting Lenders, and seventh after the termination of the Commitments and payment in full of all obligations of the Borrower hereunder, to pay amounts owing under this Agreement to such Defaulting Lender or as a court of competent jurisdiction may otherwise direct.

 

(c)                                  In furtherance of the foregoing, if any Lender becomes, and during the period it remains, a Defaulting Lender or a Potential Defaulting Lender, each of the Issuing Bank and the Swing Line Bank is hereby authorized by the Borrower (which authorization is irrevocable and coupled with an interest) to

 

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give, in its discretion, through the Administrative Agent, Notices of Borrowing pursuant to Section 2.02 in such amounts and in such times as may be required to (i) reimburse an outstanding Letter of Credit Disbursement, (ii) repay an outstanding Swing Line Advance, and/or (iii) Cash Collateralize the obligations of the Borrower in respect of outstanding Letters of Credit or Swing Line Advances in an amount at least equal to the aggregate amount of the obligations (contingent or otherwise) of such Defaulting Lender or Potential Defaulting Lender in respect of such Letter of Credit or Swing Line Advance.

 

(d)                                 Anything herein to the contrary notwithstanding, if at any time the Required Lenders determine that a Person serving as an Agent is (without taking into account any provision in the definition of “Defaulting Lender” requiring notice from the Administrative Agent or any other party) a Defaulting Lender pursuant to clause (v) of the definition thereof, the Required Lenders (determined after giving effect to Section 9.01) may by notice to the Borrower and such Person remove such Person as Agent and, in consultation with the Borrower, appoint a replacement Agent hereunder.  Such removal will, to the fullest extent permitted by applicable law, be effective on the earlier of (i) the date a replacement Agent is appointed and (ii) the date thirty (30) days after the giving of such notice by the Required Lenders (regardless of whether a replacement Agent has been appointed).

 

(e)                                  The Borrower may terminate the unused amount of the Commitment of a Defaulting Lender upon not less than thirty (30) Business Days’ prior notice to the Administrative Agent (which will promptly notify the Lenders thereof), and in such event the provisions of Section 2.17(b)(iii) will apply to all amounts thereafter paid by the Borrower for the account of such Defaulting Lender under this Agreement (whether on account of principal, interest, fees, indemnity or other amounts), provided that such termination will not  be deemed to be a waiver or release of any claim the Borrower, the Administrative Agent, the Issuing Bank, the Swing Line Bank or any Lender may have against such Defaulting Lender.

 

(f)                                   If the Borrower, the Administrative Agent, the Issuing Bank and the Swing Line Bank agree in writing, in their reasonable discretion, that a Lender is no longer a Defaulting Lender or a Potential Defaulting Lender, as the case may be, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any amounts then held in the segregated account referred to in Section 2.17(b)), such Lender will, to the extent applicable, purchase at par such portion of outstanding Advances of the other Lenders and/or make such other adjustments as the Administrative Agent may determine to be necessary to cause the Revolving Credit Exposure, Letter of Credit Exposure and Swing Line Exposure of the Lenders to be on a pro rata basis in accordance with their respective Commitments, whereupon such Lender will cease to be a Defaulting Lender or Potential Defaulting Lender and will be a Non-Defaulting Lender (and such Exposure of each Lender will automatically be adjusted on a prospective basis to reflect the foregoing); provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while such Lender was a Defaulting Lender; and provided further that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender or Potential Defaulting Lender to Non-Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender’s having been a Defaulting Lender or Potential Defaulting Lender.

 

SECTION 2.18                                 Replacement of Lenders.  If any Lender requests compensation under Section 2.10, or if the Borrower is required to pay any additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.12 and, in each case, such Lender has declined or is unable to designate a different Applicable Lending Office, or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender (a “Departing Lender”) to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Sections 9.01(b) and 9.07, as applicable, in each case except to the extent provided in this Section 2.18)), all of its interests, rights (other than its existing rights to payments pursuant to Section 2.10 or Section 2.12) and obligations under this Agreement and the other Loan Documents to an Eligible Assignee designated by the Borrower and approved by the Administrative Agent (such approval not to be unreasonably withheld) that

 

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shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment) (a “Replacement Lender”); provided that:

 

(a)                                 the Borrower shall have paid to the Administrative Agent the assignment fee (if any) specified in Section 9.07;

 

(b)                                 such Departing Lender shall have received payment of an amount equal to the outstanding principal of its Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents from the applicable Replacement Lender (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);

 

(c)                                  in the case of any such assignment resulting from a claim for compensation under Section 2.10 or payments required to be made pursuant to Section 2.12, such assignment will result in a reduction in such compensation or payments thereafter;

 

(d)                                 such assignment does not conflict with applicable law; and

 

(e)                                  in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, the applicable Replacement Lender shall have consented to the applicable amendment, waiver or consent.

 

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.  Each Departing Lender required to make an assignment pursuant to this Section 2.18 shall promptly execute and deliver an Assignment and Acceptance with the applicable Replacement Lender.  If such Departing Lender does not execute and deliver to the Administrative Agent a duly completed Assignment and Acceptance and/or any other documentation necessary to reflect such replacement within a period of time deemed reasonable by the Administrative Agent after the later of (i) the date on which the Replacement Lender executes and delivers such Assignment and Acceptance and/or such other documentation and (ii) the date on which the Departing Lender receives all payments described in clause (b) of this Section 2.18, then such Departing Lender shall be deemed to have executed and delivered such Assignment and Acceptance and/or such other documentation as of such date and the Borrower shall be entitled (but not obligated) to execute and deliver such Assignment and Acceptance and/or such other documentation on behalf of such Departing Lender.

 

SECTION 2.19                                 Increase in the Aggregate Commitments.

 

(a)                                 The Borrower may, at any time (but no more than once in any consecutive 12-month period), by written notice to the Administrative Agent, request an increase in the aggregate amount of the Revolving Credit Commitments by not less than $5,000,000 (each such proposed increase, a “Commitment Increase”) to be effective as of a date that is at least 90 days prior to the scheduled Termination Date then in effect (the “Increase Date”) as specified in the related notice to the Administrative Agent; provided, however, that (i) in no event shall the aggregate amount of the Commitments at any time exceed $200,000,000, (ii) in no event shall the Borrower submit more than four separate requests for a Commitment Increase hereunder, and (iii) on the date of any request by the Borrower for a Commitment Increase and on the related Increase Date, the applicable conditions set forth in Article III shall be satisfied.

 

(b)                                 The Administrative Agent shall promptly notify the Lenders and such other Eligible Assignees as are designated by the Borrower and are reasonably acceptable to the Administrative Agent of each request by the Borrower for a Commitment Increase, which notice shall include (i) the proposed amount of such requested Commitment Increase, (ii) the proposed Increase Date and (iii) the date by which Lenders and such other Eligible Assignees wishing to participate in the Commitment Increase must commit to an increase in the amount of their respective Commitments or to establish their Commitments, as applicable (the

 

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“Commitment Date”).  Each Lender or other Eligible Assignee that is willing to participate in such requested Commitment Increase (each, an “Increasing Lender”) shall, in its sole discretion, give written notice to the Administrative Agent on or prior to the Commitment Date of the amount by which it is willing to increase or establish, as applicable, its Commitment (the “Proposed Increased Commitment”).  If the Lenders and such other Eligible Assignees notify the Administrative Agent that they are willing to increase (or establish, as applicable) the amount of their respective Commitments by an aggregate amount that exceeds the amount of the requested Commitment Increase, the requested Commitment Increase shall be allocated to each Lender and each such other Eligible Assignee willing to participate therein in amounts determined by the Administrative Agent and the Borrower.  In no event, however, shall any Lender be required to participate in a Commitment Increase.

 

(c)                                  Promptly following each Commitment Date, the Administrative Agent shall notify the Borrower as to the amount, if any, by which the Lenders and other Eligible Assignees are willing to participate in the requested Commitment Increase.  If the aggregate amount by which the Lenders and such Eligible Assignees are willing to participate in any requested Commitment Increase on any such Commitment Date is less than the requested Commitment Increase, then the Borrower may extend offers to one or more additional Eligible Assignees satisfactory to the Administrative Agent to participate in any portion of the requested Commitment Increase that has not been committed to by the Lenders as of the applicable Commitment Date; provided, however, that the Commitment of each such Eligible Assignee shall be in an amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof.

 

(d)                                 On each Increase Date, (x) each Eligible Assignee (other than a Lender) that accepts an offer to participate in a requested Commitment Increase in accordance with Section 2.19(c) (an “Acceding Lender”) shall become a Lender party to this Agreement as of such Increase Date and such Acceding Lender’s Commitment shall be governed by the terms and provisions of this Agreement and (y) the Commitment of each Increasing Lender for such requested Commitment Increase shall be so increased by such amount (or by the amount allocated to such Lender pursuant to the penultimate sentence of Section 2.19(b)) as of such Increase Date; provided, however, that the Administrative Agent shall have received at or before 12:00 Noon (New York City time) on such Increase Date the following, each dated such date:

 

(i)                                     an accession agreement from each Acceding Lender, if any, in form and substance satisfactory to the Borrower and the Administrative Agent (each, an “Accession Agreement”), duly executed by such Acceding Lender, the Administrative Agent and the Borrower;

 

(ii)                                  confirmation from each Increasing Lender of the increase in the amount of its Commitment in a writing satisfactory to the Borrower and the Administrative Agent, together with an amended Schedule I hereto as may be necessary for such Schedule I to be accurate and complete, certified as correct and complete by a Responsible Officer of the Borrower;

 

(iii)                               upon the request of the Administrative Agent, an “additional advance” or 108.8 endorsement to one or more of the Mortgage Policies in form and substance and in amount reasonably satisfactory to the Administrative Agent;

 

(iv)                              if reasonably requested by the Administrative Agent, endorsements or new title policies increasing the aggregate amount of the title insurance policies with respect to the Borrowing Base Assets; and

 

(v)                                 such certificates or other information as may be required pursuant to Section 3.02.

 

On each Increase Date, upon fulfillment of the conditions set forth in the immediately preceding sentence of this Section 2.19(d), the Administrative Agent shall notify the Lenders (including, without limitation, each Acceding Lender) and the Borrower, at or before 1:00 P.M. (New York City time), by posting such notice on an Approved Electronic Platform in accordance with Section 9.02(c), of the occurrence of the Commitment

 

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Increase to be effected on such Increase Date and shall record in the Register the relevant information with respect to each Increasing Lender and each Acceding Lender on such date.

 

(e)                                  On the Increase Date, to the extent the Advances then outstanding and owed to any Lender immediately prior to the effectiveness of the Commitment Increase shall be less than such Lender’s Pro Rata Share (calculated immediately following the effectiveness of the Commitment Increase) of all Advances then outstanding and owed to all Lenders (each such Lender, including any Acceding Lender, a “Purchasing Lender”), then such Purchasing Lender, without executing an Assignment and Acceptance, shall be deemed to have purchased an assignment of a pro rata portion of the Advances then outstanding and owed to each Lender that is not a Purchasing Lender (a “Selling Lender”) in an amount sufficient such that following the effectiveness of all such assignments the Advances outstanding and owed to each Lender shall equal such Lender’s Pro Rata Share (calculated immediately following the effectiveness of the Commitment Increase on the Increase Date) of all Advances then outstanding and owed to all Lenders.  The Administrative Agent shall calculate the net amount to be paid by each Purchasing Lender and received by each Selling Lender in connection with the assignments effected hereunder on the Increase Date.  Each Purchasing Lender shall make the amount of its required payment available to the Administrative Agent, in same day funds, at the office of the Administrative Agent not later than 12:00 P.M. (New York time) on the Increase Date.  The Administrative Agent shall distribute on the Increase Date the proceeds of such amount to each of the Selling Lenders entitled to receive such payments at its Applicable Lending Office.  If in connection with the transactions described in this Section 2.19 any Lender shall incur any losses, costs or expenses of the type described in Section 9.04(c), then the Borrower shall, upon demand by such Lender (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender any amounts required to compensate such Lender for such losses, costs or expenses reasonably incurred.

 

SECTION 2.20                                 Reallocation of Lender Pro Rata Shares; No Novation.  On the Closing Date, the Advances made under the Existing Agreement shall be deemed to have been made under this Agreement, without the execution by the Borrower or the Lender Parties of any other documentation, and all such Advances currently outstanding shall be deemed to have been simultaneously reallocated among the Lenders as follows:

 

(a)                                 On the Effective Date, each Lender that will have a greater Pro Rata Share of the Facility upon the Effective Date than its Pro Rata Share (under and as defined in the Existing Agreement) of the Facility (under and as defined in the Existing Agreement) immediately prior to the Effective Date (each, a “Facility Purchasing Bank”), without executing an Assignment and Acceptance, shall be deemed to have purchased assignments pro rata from each Lender that will have a smaller Pro Rata Share of the Facility upon the Effective Date than its Pro Rata Share (under and as defined in the Existing Agreement) of the Facility (under and as defined in the Existing Agreement) immediately prior to the Effective Date (each, a “Facility Selling Bank”) in all such Facility Selling Bank’s rights and obligations under this Agreement and the other Loan Documents as a Lender (collectively, the “Facility Assigned Rights and Obligations”) so that, after giving effect to such assignments, each Lender shall have its respective Commitment as set forth in Schedule I hereto and a corresponding Pro Rata Share of all Advances then outstanding under the Facility.  Each such purchase hereunder shall be at par for a purchase price equal to the principal amount of the loans and without recourse, representation or warranty, except that each Facility Selling Bank shall be deemed to represent and warrant to each Facility Purchasing Bank that the Facility Assigned Rights and Obligations of such Facility Selling Bank are not subject to any Liens created by that Facility Selling Bank.  For the avoidance of doubt, in no event shall the aggregate amount of each Lender’s Revolving Advances outstanding at any time exceed its Commitment as set forth in Schedule I hereto.

 

(b)                                 The Borrower shall, upon written demand by any Lender Party (with a copy of such demand to the Administrative Agent), promptly compensate such Lender Party for and hold such Lender Party harmless from any loss, cost or expense incurred by it as a result of the reallocations set forth in Section 2.20(a) above in respect of Eurodollar Rate Advances to the extent such reallocations take place on a day other than the last day of the Interest Period for such Eurodollar Rate Advances.

 

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The Borrower shall also, upon written demand by any Facility Selling Bank that is transferring all of its rights and obligations under this Agreement (with a copy of such demand to the Administrative Agent), promptly compensate such Facility Selling Bank for and hold such Facility Selling Bank harmless from any loss, cost or expense incurred by it as a result of such reallocations to the extent such reallocations take place on a day other than the last day of the Interest Period for such Eurodollar Rate Advances.  Each such Facility Selling Bank shall be a third party beneficiary of this Section 2.20(b).

 

(c)                                  The Administrative Agent shall calculate the net amount to be paid or received by each Lender in connection with the assignments effected hereunder on the Effective Date.  Each Lender required to make a payment pursuant to this Section shall make the net amount of its required payment available to the Administrative Agent, in same day funds, at the office of the Administrative Agent not later than 12:00 P.M. (New York time) on the Effective Date.  The Administrative Agent shall distribute on the Effective Date the proceeds of such amounts to the Lenders entitled to receive payments pursuant to this Section, pro rata in proportion to the amount each such Lender is entitled to receive at the primary address set forth in Schedule I hereto or at such other address as such Lender may request in writing to the Administrative Agent.

 

(d)                                 Nothing in this Agreement shall be construed as a discharge, extinguishment or novation of the Obligations of the Loan Parties outstanding under the Existing Agreement or any instruments securing the same, which Obligations shall remain outstanding under this Agreement after the date hereof as “Revolving Credit Advances” except as expressly modified hereby or by instruments executed concurrently with this Agreement.

 

ARTICLE III
 CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF CREDIT

 

SECTION 3.01                                 Conditions Precedent to Initial Extension of Credit.  The obligation of each Lender to make an Advance or of any Issuing Bank to issue or continue a Letter of Credit on the occasion of the Initial Extension of Credit hereunder is subject to the satisfaction of the following conditions precedent before or concurrently with the Initial Extension of Credit:

 

(a)                                 The Administrative Agent shall have received on or before the day of the Initial Extension of Credit the following, each dated such day (unless otherwise specified), in form and substance satisfactory to the Administrative Agent (unless otherwise specified) and (except for the Notes, as to which one original of each shall be sufficient) in sufficient copies for each Lender Party:

 

(i)                                     A Note duly executed by the Borrower and payable to the order of each Lender which has requested one.

 

(ii)                                  An amended and restated security agreement in substantially the form of Exhibit F hereto (together with each other security agreement and security agreement supplement delivered pursuant to Section 5.01 (j), in each case as amended, the “Security Agreement”), duly executed by each Loan Party that owns Borrowing Base Assets, together with:

 

(A)                               (I) with respect to each Guarantor that is not a Guarantor (as defined in the Existing Agreement), acknowledgment copies of proper UCC-1 financing statements and (II) with respect to each other Guarantor, acknowledgment copies of proper UCC-3 continuation financing statements, in each case, duly filed on or before the day of the Initial Extension of Credit under the Uniform Commercial Code of all jurisdictions that the Administrative Agent may deem necessary or desirable in order to perfect, protect and continue (if applicable) the first priority liens and security interests created under the Collateral Documents, covering the Collateral described therein,

 

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(B)                               completed requests for information dated a recent date, including UCC, judgment, tax, litigation and bankruptcy searches with respect to each applicable Loan Party, and, in the case of UCC searches, listing all effective financing statements filed in the jurisdictions referred to in clause (A) above and in such other jurisdictions specified by the Administrative Agent that name any Loan Party as debtor, together with copies of such financing statements,

 

(C)                               evidence of the completion of all other recordings and filings of or with respect to the Security Agreement that the Administrative Agent may deem necessary or desirable in order to perfect and protect the Liens created thereby,

 

(D)                               certified copies of the Management Agreements and all amendments thereto entered into on or before the Closing Date with respect to each Borrowing Base Asset;

 

(E)                                a subordination agreement executed and delivered by the property manager of each Borrowing Base Asset, and

 

(F)                                 evidence that all other action that the Collateral Agent may reasonably deem necessary or desirable in order to perfect and protect the first priority liens and security interests created under the Security Agreement has been taken (including, without limitation, receipt of duly executed payoff letters, UCC termination statements and landlords’ and bailees’ waiver and consent agreements).

 

(iii)                               (A) With respect to each New Borrowing Base Asset, deeds of trust, trust deeds and mortgages in substantially the form of Exhibit G hereto and (B) with respect to each Existing Borrowing Base Asset, an amendment and restatement of the applicable Mortgage (as defined in the Existing Agreement) previously delivered for such Existing Borrowing Base Asset (in each case, with such changes as may be required to account for local law matters and otherwise satisfactory in form and substance to the Administrative Agent) (together with each other deed of trust, trust deed and mortgage delivered pursuant to Section 5.01(j), in each case as amended, the “Mortgages”), in each case duly executed by the appropriate Loan Party, together with:

 

(A)                               evidence that counterparts of the Mortgages have been duly executed, acknowledged and delivered on or before the day of the Initial Extension of Credit and are in form suitable for filing or recording in all filing or recording offices that the Administrative Agent may deem necessary or desirable in order to create a valid first and subsisting Lien on the collateral described therein in favor of the Administrative Agent for the benefit of the Secured Parties and that all required affidavits, tax forms and filings pertaining to any applicable documentary stamp, intangible and mortgage recordation taxes have been executed and delivered by all appropriate parties and are in form suitable for filing with all applicable governmental authorities,

 

(B)                               (I) with respect to each New Borrowing Base Asset, fully paid American Land Title Association Lender’s Extended Coverage title insurance policies and (II) with respect to each Existing Borrowing Base Asset, either fully paid American Land Title Association Lender’s Extended Coverage title insurance policies or endorsements (including date down endorsements) to the Mortgage Policies (as defined in the Existing Agreement) (collectively, the “Mortgage Policies”), in each case in form and substance, with (if applicable) endorsements (including zoning endorsements where available) and in amount acceptable to the Administrative Agent, issued by a title insurer acceptable to the Administrative

 

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Agent, insuring the Mortgages to be valid first and subsisting Liens on the property described therein, free and clear of all defects (including, but not limited to, mechanics’ and materialmen’s Liens) and encumbrances, excepting only Permitted Encumbrances, and providing for such other affirmative insurance (including endorsements for future advances under the Loan Documents and for mechanics’ and materialmen’s Liens) as the Administrative Agent may deem necessary or desirable,

 

(C)                               American Land Title Association/American Congress on Surveying and Mapping form surveys for which all necessary fees have been paid, dated no more than 30 days before the date of their delivery to the Collateral Agent, certified to the Administrative Agent, the Collateral Agent and the issuer of the Mortgage Policies in a manner satisfactory to the Collateral Agent by a land surveyor duly registered and licensed in the States in which the property described in such surveys is located and acceptable to the Collateral Agent, showing, as to the Borrowing Base Assets, all buildings and other improvements, any off-site improvements, the location of any easements, parking spaces, rights of way, building set-back lines and other dimensional regulations and the absence of encroachments, either by such improvements or on to such property, and other defects, other than encroachments and other defects acceptable to the Collateral Agent, or existing surveys in lieu thereof so long as each such survey is accompanied by an affidavit of no-change, satisfactory to the Collateral Agent and sufficient for the applicable title insurer to eliminate all standard survey-related exceptions to the applicable Mortgage Policy,

 

(D)                               engineering, soils, seismic, environmental and other similar reports as to the Borrowing Base Assets, in form and substance and from professional firms acceptable to the Administrative Agent,

 

(E)                                estoppel and consent agreements, in form and substance satisfactory to the Administrative Agent, executed by each of the lessors of any Borrowing Base Assets subject to a Qualifying Ground Lease, along with (1) a memorandum of lease in recordable form with respect to such leasehold interest, executed and acknowledged by the owner of the affected Borrowing Base Asset, as lessor, or (2) evidence that the applicable lease with respect to such leasehold interest or memorandum thereof has been recorded in all places necessary or desirable, in the Administrative Agent’s reasonable judgment, to give constructive notice to third-party purchasers of such leasehold interest or (3) if such leasehold interest was acquired or subleased from the holder of a recorded leasehold interest, the applicable assignment or sublease document, executed and acknowledged by such holder, in each case in form sufficient to give such constructive notice upon recordation and otherwise in form satisfactory to the Administrative Agent,

 

(F)                                 an Appraisal of each Borrowing Base Asset described in the Mortgages,

 

(G)                               copies of all material licenses, permits and approvals, including, without limitation, all Healthcare Licenses relating to each Borrowing Base Asset and, if available, the certificate of occupancy for each Borrowing Base Asset,

 

(H)                              a zoning report for each Borrowing Base Asset issued by Planning and Zoning Resources Corp. or another professional firm acceptable to the Administrative Agent,

 

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(I)                                   copies of each Management Agreement, Qualifying Ground Lease, and all amendments thereto, entered into with respect to each of the Borrowing Base Assets,

 

(J)                                   copies of all leases (including, without limitation, all leases with Affiliates, but excluding all Tenancy Leases) and Material Contracts relating to each of the Borrowing Base Assets,

 

(K)                               copies of all Liens on each of the Borrowing Base Assets, including, without limitation, any reciprocal easement agreements, easements and other items of record, and

 

(L)                                such other consents, agreements and confirmations of lessors and third parties as the Administrative Agent may reasonably deem necessary or desirable and evidence that all other action that the Collateral Agent may reasonably deem necessary or desirable in order to create valid first and subsisting Liens on the property described in the Mortgages has been taken.

 

(iv)                              This Agreement duly executed by the Loan Parties and the other parties thereto.

 

(v)                                 Certified copies of the resolutions of the Board of Directors of the Borrower on its behalf and on behalf of each Loan Party for which it is the ultimate signatory approving the transactions contemplated by the Loan Documents and each Loan Document to which it or such Loan Party is or is to be a party, and of all documents evidencing other necessary corporate action and governmental and other third party approvals and consents, if any, with respect to the transactions under the Loan Documents and each Loan Document to which it or such Loan Party is or is to be a party.

 

(vi)                              A copy of a certificate of the Secretary of State (or equivalent authority) of the jurisdiction of incorporation, organization or formation of each Loan Party and of each general partner or managing member (if any) of each Loan Party, dated reasonably near the Closing Date, certifying, if and to the extent such certification is generally available for entities of the type of such Loan Party, (A) as to a true and correct copy of the charter, certificate of limited partnership, limited liability company agreement or other organizational document of such Loan Party, general partner or managing member, as the case may be, and each amendment thereto on file in such Secretary’s office, (B) that (1) such amendments are the only amendments to the charter, certificate of limited partnership, limited liability company agreement or other organizational document, as applicable, of such Loan Party, general partner or managing member, as the case may be, on file in such Secretary’s office, (2) such Loan Party, general partner or managing member, as the case may be, has paid all franchise taxes to the date of such certificate and (C) such Loan Party, general partner or managing member, as the case may be, is duly incorporated, organized or formed and in good standing or presently subsisting under the laws of the jurisdiction of its incorporation, organization or formation.

 

(vii)                           A copy of a certificate of the Secretary of State (or equivalent authority) of each jurisdiction in which any Loan Party or any general partner or managing member of a Loan Party owns or leases property or in which the conduct of its business requires it to qualify or be licensed as a foreign corporation except where the failure to so qualify or be licensed could not reasonably be expected to result in a Material Adverse Effect, dated reasonably near (but prior to) the Closing Date, stating, with respect to each such Loan Party, general partner or managing member, that such Loan Party, general partner or managing member, as the case may be, is duly qualified and in good standing as a foreign corporation,

 

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limited partnership or limited liability company in such State and has filed all annual reports required to be filed to the date of such certificate.

 

(viii)                        A certificate of each Loan Party and of each general partner or managing member (if any) of each Loan Party, signed on behalf of such Loan Party, general partner or managing member, as applicable, by its President or a Vice President (or other Responsible Officer) and its Secretary or any Assistant Secretary (or those of its general partner or managing member, if applicable), dated the Closing Date (the statements made in which certificate shall be true on and as of the date of the Initial Extension of Credit), certifying as to (A) the absence of any amendments to the constitutive documents of such Loan Party, general partner or managing member, as applicable, since the date of the certificate referred to in Section 3.01(a)(vi), (B) a true and correct copy of the bylaws, operating agreement, partnership agreement or other governing document of such Loan Party, general partner or managing member, as applicable, as in effect on the date on which the resolutions referred to in Section 3.01(a)(v) were adopted and on the date of the Initial Extension of Credit, (C) the due incorporation, organization or formation and good standing or valid existence of such Loan Party, general partner or managing member, as applicable, as a corporation, limited liability company or partnership organized under the laws of the jurisdiction of its incorporation, organization or formation and the absence of any proceeding for the dissolution or liquidation of such Loan Party, general partner or managing member, as applicable, (D) the truth of the representations and warranties contained in the Loan Documents as though made on and as of the date of the Initial Extension of Credit and (E) the absence of any event occurring and continuing, or resulting from the Initial Extension of Credit, that constitutes a Default.  Notwithstanding the foregoing, items (D) and (E) in the previous sentence may be certified in a separate officer’s certificate by the Treasurer and Chief Financial Officer of each Loan Party, or general partner or managing member (if any) of each Loan Party.

 

(ix)                              A certificate of the Secretary or an Assistant Secretary of each Loan Party (or Responsible Officer of the general partner or managing member of any Loan Party) and of each general partner or managing member (if any) of each Loan Party certifying the names and true signatures of the officers of such Loan Party, or of the general partner or managing member of such Loan Party, authorized to sign each Loan Document to which it is or is to be a party and the other documents to be delivered hereunder and thereunder.

 

(x)                                 Such financial, business and other information regarding each Loan Party and its Subsidiaries as the Lender Parties shall have reasonably requested.

 

(xi)                              Evidence of insurance (which may consist of binders or certificates of insurance) naming the Administrative Agent as loss payee and additional insured with such responsible and reputable insurance companies or associations, and in such amounts and covering such risks, as is satisfactory to the Lender Parties, including, without limitation, the insurance required by the terms of the Security Agreement and the Mortgages.

 

(xii)                           An opinion of Sullivan & Worcester LLP, New York counsel for the Loan Parties, with respect to the matters (and in substantially the form) set forth in Exhibit E-1 hereto and as to such other matters as any Lender Party through the Administrative Agent may reasonably request.

 

(xiii)                        An opinion of local counsel for the Loan Parties (A) in the states in which the Borrowing Base Assets are located, in substantially the form of Exhibit E-2 hereto, and (B) in the states in which the Loan Parties are organized or formed, in substantially the form of Exhibit E-3 hereto, in each case covering such other matters as any Lender Party through the Administrative Agent may reasonably request.

 

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(xiv)                       An opinion of Venable LLP, Maryland counsel for the Loan Parties, with respect to the matters (and in substantially the form) set forth in Exhibit E-3 hereto and as to such other matters as any Lender Party through the Administrative Agent may reasonably request.

 

(xv)                          An opinion of Shearman & Sterling LLP, counsel for the Administrative Agent, in form and substance satisfactory to the Administrative Agent.

 

(xvi)                       A Notice of Borrowing or Notice of Issuance, as applicable, relating to the Initial Extension of Credit and dated and delivered to the Administrative Agent at least three Business Days prior to the Closing Date.

 

(xvii)                    A certificate signed by a Responsible Officer of the Borrower, dated the Closing Date, stating that after giving effect to the Initial Extension of Credit, the Borrower shall be in compliance with the covenants contained in Section 5.04, together with supporting information in form satisfactory to the Administrative Agent showing the computations used in determining compliance with such covenants.

 

(xviii)                 The Flood Insurance Documents.

 

(b)                                 The Lender Parties shall be satisfied with the corporate and legal structure and capitalization of each Loan Party and its Subsidiaries, including the terms and conditions of the charter and bylaws, operating agreement, partnership agreement or other governing document of each of them.

 

(c)                                  The Lender Parties shall be satisfied that all Existing Debt, other than Surviving Debt, has been prepaid, redeemed or defeased in full or otherwise satisfied and extinguished and that all Surviving Debt shall be on terms and conditions satisfactory to the Lender Parties.

 

(d)                                 Before and after giving effect to the transactions contemplated by the Loan Documents, there shall have occurred no Material Adverse Change since December 31, 2015.

 

(e)                                  There shall exist no action, suit, investigation, litigation or proceeding affecting any Loan Party or any of its Subsidiaries pending or threatened before any court, governmental agency or arbitrator that (i) could reasonably be expected to result in a Material Adverse Effect other than the matters described on Schedule 4.01(f) hereto (the “Material Litigation”) or (ii) purports to affect the legality, validity or enforceability of any Loan Document or the consummation of the transactions contemplated thereby, and there shall have been no adverse change in the status, or financial effect on any Loan Party or any of its Subsidiaries, of the Material Litigation from that described on Schedule 4.01(f) hereto.

 

(f)                                   All governmental and third party consents and approvals necessary in connection with the transactions contemplated by the Loan Documents shall have been obtained (without the imposition of any conditions that are not acceptable to the Lender Parties) and shall remain in effect, and no law or regulation shall be applicable in the reasonable judgment of the Lender Parties that restrains, prevents or imposes materially adverse conditions upon the transactions contemplated by the Loan Documents.

 

(g)                                  The Borrower shall have paid all accrued fees of the Agents and the Lender Parties and all reasonable, out-of-pocket expenses of the Agents (including the reasonable fees and expenses of counsel to the Administrative Agent).

 

For avoidance of doubt, to the extent that with respect to the Pending Borrowing Base Assets the Borrower shall elect to satisfy any of the foregoing conditions precedent (in each case which are susceptible of being so satisfied) by delivering Collateral Deliverables with respect thereto to the

 

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Agents within 90 days after the Closing Date pursuant to the definition of Borrowing Base Assets, then notwithstanding anything to the contrary contained in this Section 3.01, the Borrower shall not be required to satisfy such conditions before or concurrently with the Initial Extension of Credit pursuant to this Section 3.01.

 

SECTION 3.02                                 Conditions Precedent to Each Borrowing, Issuance, Renewal, Increase and Extension.  (a)  The obligation of each Lender to make an Advance (other than a Letter of Credit Advance made by an Issuing Bank or a Lender pursuant to Section 2.03(c) and a Swing Line Advance made by a Lender pursuant to Section 2.02(b)) on the occasion of each Borrowing (including the initial Borrowing) and the obligation of each Issuing Bank to issue a Letter of Credit (including the initial issuance) or renew a Letter of Credit, the extension of Commitments pursuant to Section 2.16, a Commitment Increase pursuant to Section 2.19 and the right of the Borrower to request a Swing Line Borrowing shall be subject to the satisfaction of the conditions set forth in Section 3.01 (to the extent not previously satisfied pursuant to that Section) and such further conditions precedent that on the date of such Borrowing, issuance, renewal or extension or such Increase Date (a) the following statements shall be true and the Administrative Agent shall have received for the account of such Lender, the Swing Line Bank or such Issuing Bank (w) a Notice of Borrowing, Notice of Issuance or notice requesting a Commitment Increase, as applicable, and a Borrowing Base Certificate, in each case dated the date of such Borrowing, issuance, renewal or extension or such Increase Date and, in the case of the Borrowing Base Certificate, demonstrating that the Facility Available Amount as of such date (calculated on a pro forma basis after giving effect to such Borrowing, issuance or Commitment Increase) will be greater than or equal to the Facility Exposure, (x) all Collateral Deliverables and all items described in the definition of “BBA Proposal Package” herein (to the extent not previously delivered with respect to each Borrowing Base Asset pursuant to Section 3.01, Section 5.01(k) or this Section 3.02), (y) in the case of an addition of any Person as an Additional Guarantor, all Guarantor Deliverables (to the extent not previously delivered pursuant to Section 3.01, Section 5.01(k) or this Section 3.02), and (z) a certificate signed by a Responsible Officer of the Borrower, dated the date of such Borrowing, issuance, renewal or extension or such Increase Date, stating that:

 

(i)                                     the representations and warranties contained in each Loan Document are true and correct on and as of such date (except that those that expressly relate to a prior date shall be true as though made on and as of such prior date), before and after giving effect to (A) such Borrowing, issuance, renewal or extension or Commitment Increase and (B) in the case of any Borrowing or issuance or renewal, the application of the proceeds therefrom;

 

(ii)                                  no Default or Event of Default has occurred and is continuing, or would result from (A) such Borrowing, issuance, renewal or extension or Commitment Increase or (B) in the case of any Borrowing or issuance or renewal, from the application of the proceeds therefrom; and

 

(iii)                               for each Revolving Credit Advance, or Swing Line Advance made by the Swing Line Bank or issuance or renewal of any Letter of Credit or Commitment Increase, (A) the Facility Available Amount equals or exceeds the Facility Exposure that will be outstanding after giving effect to such Advance, issuance or renewal or Commitment Increase, respectively, and (B) before and after giving effect to such Advance, issuance or renewal or Commitment Increase, the Borrower shall be in compliance with the covenants contained in Section 5.04, together with supporting information in form satisfactory to the Administrative Agent showing the computations used in determining compliance with such covenants;

 

and (b) the Administrative Agent shall have received such other approvals, opinions or documents as any Lender Party through the Administrative Agent may reasonably request.

 

(b)                                 In addition to the other conditions precedent herein set forth, if any Lender becomes, and during the period it remains, a Defaulting Lender or a Potential Defaulting Lender, the Issuing Bank will not be required to issue any Letter of Credit or to amend any outstanding Letter of Credit and the Swing Line Bank will not be required to make any Swing Line Advance, unless the Issuing Bank or the Swing Line Bank,

 

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as the case may be, is satisfied that any exposure that would result therefrom is fully covered or eliminated by any combination satisfactory to the Issuing Bank or Swing Line Bank of the following:

 

(i)                                     in the case of a Defaulting Lender, the Letter of Credit Exposure and the Swing Line Exposure of such Defaulting Lender is reallocated, as to outstanding and future Letters of Credit and Swing Line Advances, to the Non-Defaulting Lenders as provided in clause (i) of Section 2.17(b);

 

(ii)                                  in the case of a Defaulting Lender or a Potential Defaulting Lender, without limiting the provisions of Section 2.17(a), the Borrower Cash Collateralizes the obligations of the Borrower in respect of such Letter of Credit or Swing Line Advance in an amount at least equal to the aggregate amount of the unreallocated obligations (contingent or otherwise) of such Defaulting Lender or Potential Defaulting Lender in respect of such Letter of Credit or Swing Line Advance, or makes other arrangements satisfactory to the Administrative Agent, the Issuing Bank and the Swing Line Bank in their sole discretion to protect them against the risk of non-payment by such Defaulting Lender or Potential Defaulting Lender; and

 

(iii)                               in the case of a Defaulting Lender or a Potential Defaulting Lender, then in the case of a proposed issuance of a Letter of Credit or making of a Swing Line Advance, by an instrument or instruments in form and substance satisfactory to the Administrative Agent, and to the Issuing Bank and the Swing Line Bank, as the case may be, the Borrower agrees that the face amount of such requested Letter of Credit or the principal amount of such requested Swing Line Advance will be reduced by an amount equal to the unreallocated, non-Cash Collateralized portion thereof as to which such Defaulting Lender or Potential Defaulting Lender would otherwise be liable, in which case the obligations of the Non-Defaulting Lenders in respect of such Letter of Credit or Swing Line Advance will, subject to the first proviso below, be on a pro rata basis in accordance with the Commitments of the Non-Defaulting Lenders, and the pro rata payment provisions of Section 2.11(f) will be deemed adjusted to reflect this provision;

 

provided that (a) the sum of each Non-Defaulting Lender’s total Revolving Credit Exposure, total Swing Line Exposure and total Letter of Credit Exposure may not in any event exceed the Commitment of such Non-Defaulting Lender, and (b) neither any such reallocation nor any payment by a Non-Defaulting Lender pursuant thereto nor any such Cash Collateralization or reduction will constitute a waiver or release of any claim the Borrower, the Administrative Agent, the Issuing Bank, the Swing Line Bank or any other Lender may have against such Defaulting Lender, or cause such Defaulting Lender or Potential Defaulting Lender to be a Non-Defaulting Lender.

 

SECTION 3.03                                 Determinations Under Section 3.01 and 3.02.  For purposes of determining compliance with the conditions specified in Sections 3.01 and 3.02, each Lender Party shall be deemed to have consented to, approved or accepted or to be satisfied with each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to the Lender Parties unless an officer of the Administrative Agent responsible for the transactions contemplated by the Loan Documents shall have received notice from such Lender Party prior to the Initial Extension of Credit (in the case of Section 3.01) or the applicable Borrowing, issuance, renewal, extension or increase (in the case of Section 3.02) specifying its objection thereto and, in the case of a Borrowing, such Lender Party shall not have made available to the Administrative Agent such Lender Party’s ratable portion of such Borrowing.

 

ARTICLE IV
 REPRESENTATIONS AND WARRANTIES

 

SECTION 4.01                                 Representations and Warranties of the Loan Parties.  Each Loan Party represents and warrants as follows:

 

(a)                                 Organization and Powers; Qualifications and Good Standing.  Each Loan Party and each of its Subsidiaries and each general partner or managing member, if any, of each Loan Party (i) is

 

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a corporation, limited liability company or partnership duly incorporated, organized or formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation, organization or formation, (ii) is duly qualified and in good standing as a foreign corporation, limited liability company or partnership in each other jurisdiction in which it owns or leases property or in which the conduct of its business requires it to so qualify or be licensed except where the failure to so qualify or be licensed could not reasonably be expected to result in a Material Adverse Effect and (iii) has all requisite corporate, limited liability company or partnership power and authority to own or lease and operate its properties and to carry on its business as now conducted and as proposed to be conducted.  All of the outstanding Equity Interests in the Borrower have been validly issued, are fully paid and non-assessable.

 

(b)                                 Subsidiaries.  Set forth on Schedule 4.01(b) to the Disclosure Letter is a complete and accurate list of all Subsidiaries of each Loan Party, showing as of the date hereof (as to each such Subsidiary) the jurisdiction of its incorporation, organization or formation, the number of shares (or the equivalent thereof) of each class of its Equity Interests authorized on the date hereof and the percentage of each such class of its Equity Interests owned (directly or indirectly) by such Loan Party.  As of the date hereof, there are no outstanding options, warrants, rights of conversion or purchase and similar rights with respect to the shares of any Subsidiary of any Loan Party.  All of the outstanding Equity Interests in each Loan Party’s Subsidiaries has been validly issued, are fully paid and non-assessable and to the extent owned by such Loan Party or one or more of its Subsidiaries, are owned by such Loan Party or Subsidiaries free and clear of all Liens.

 

(c)                                  Due Authorization; No Conflict.  The execution and delivery by each Loan Party and of each general partner or managing member (if any) of each Loan Party of each Loan Document to which it is or is to be a party, and the performance of its obligations thereunder, and the consummation of the transactions contemplated by the Loan Documents, are within the corporate, limited liability company or partnership powers of such Loan Party, general partner or managing member, have been duly authorized by all necessary corporate, limited liability company or partnership action, and do not (i) contravene the charter or bylaws, operating agreement, partnership agreement or other governing document of such Loan Party, general partner or managing member, (ii) violate any law, rule, regulation (including, without limitation, Regulation X of the Board of Governors of the Federal Reserve System), order, writ, judgment, injunction, decree, determination or award, (iii) conflict with or result in the breach of, or constitute a default or require any payment to be made under, any Material Contract, loan agreement, indenture, mortgage, deed of trust, lease or other instrument binding on or affecting any Loan Party, any of its Subsidiaries or any of their properties, or any general partner or managing member of any Loan Party or (iv) except for the Liens created under the Loan Documents, result in or require the creation or imposition of any Lien upon or with respect to any of the properties of any Loan Party or any of its Subsidiaries.  No Loan Party or any of its Subsidiaries is in violation of any such law, rule, regulation, order, writ, judgment, injunction, decree, determination or award or in breach of any such contract, loan agreement, indenture, mortgage, deed of trust, lease or other instrument, the violation or breach of which could reasonably be expected to result in a Material Adverse Effect.

 

(d)                                 Authorizations and Consents.  Except for those filings and/or other actions listed on Schedule 4.01(d) to the Disclosure Letter, and the approval of any federal or state licensing agencies or permitting boards that may be required in connection with any change of ownership or other state or federal review process triggered by an exercise of certain remedies available to the Administrative Agent or the Secured Parties under this Agreement, the Guaranty or the other Loan Documents, no authorization or approval or other action by, and no notice to or filing with, any Governmental Authority or regulatory body or any other third party is required for (i) the due execution, delivery, recordation, filing or performance by any Loan Party or any general partner or managing member of any Loan Party of any Loan Document to which it is or is to be a party or for the consummation of the transactions contemplated by the Loan Documents, (ii) the grant by any Loan Party (or the general partner or managing member of such Loan Party) of the Liens granted by it pursuant to the Collateral

 

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Documents, (iii) the perfection or maintenance of the Liens created under the Collateral Documents (including the first priority nature thereof) or (iv) the exercise by any Agent, the Collateral Agent or any Lender Party of its rights under the Loan Documents or the remedies in respect of the Collateral pursuant to the Collateral Documents, except for (A) authorizations, approvals, actions, notices and filings which have been duly obtained, taken, given or made and are in full force and effect and (B) prior to the date on which all Collateral Deliverables in respect of a Pending Borrowing Base Asset are delivered as contemplated in the definition of Borrowing Base Assets, any authorizations, approvals, actions, notices and filings in respect of such Pending Borrowing Base Asset.

 

(e)                                  Binding Obligation.  This Agreement has been, and each other Loan Document when delivered hereunder will have been, duly executed and delivered by each Loan Party party thereto.  This Agreement is, and each other Loan Document when delivered hereunder will be, the legal, valid and binding obligation of each Loan Party party thereto, enforceable against such Loan Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditor’s rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

 

(f)                                   Litigation.  There is no action, suit, investigation, litigation or proceeding affecting any Loan Party or any of its Subsidiaries or any general partner or managing member (if any) of any Loan Party, including any Environmental Action, pending or threatened before any court, governmental agency or arbitrator that (i) could reasonably be expected to result in a Material Adverse Effect (other than the Material Litigation) or (ii) purports to affect the legality, validity or enforceability of any Loan Document or the consummation of the transactions contemplated by the Loan Documents, and there has been no adverse change in the status, or financial effect on any Loan Party or any of its Subsidiaries or any general partner or managing member (if any) of any Loan Party, of the Material Litigation from that described on Schedule 4.01(f) hereto.

 

(g)                                  Financial Condition.  The Consolidated balance sheets of the Borrower as at December 31, 2015 and the related Consolidated statements of income and Consolidated statements of cash flows of the Borrower for the fiscal year then ended, accompanied by unqualified opinions of RSM US LLP, and the Consolidated balance sheets of the Borrower as at December 31, 2015, and the related Consolidated statements of income and Consolidated statements of cash flows of the Borrower for the 12 months then ended, copies of which have been furnished to each Lender Party, fairly present the Consolidated financial condition of the Borrower as at such dates and the Consolidated results of operations of the Borrower for the periods ended on such dates, all in accordance with generally accepted accounting principles applied on a consistent basis.  Since December 31, 2015, there has been no Material Adverse Change.

 

(h)                                 Forecasts.  The Consolidated forecasted balance sheets, statements of income and statements of cash flows of the Borrower and its Subsidiaries delivered to the Lender Parties pursuant to Section 3.01(a)(x) or 5.03 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 forecasts.

 

(i)                                     Full Disclosure.  Neither the Information Memorandum nor any other information, exhibit or report furnished by or on behalf of any Loan Party to any Agent or any Lender Party in connection with the negotiation and syndication of the Loan Documents or pursuant to the terms of the Loan Documents (in each case, as modified or supplemented by other information so furnished or publicly available in periodic and other reports, proxy statements and other materials filed by the Borrower or any Subsidiary with the Securities and Exchange Commission), taken as a whole, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements made therein not misleading; provided that, with respect to projected financial information, pro forma financial information, estimated financial information and other projected or estimated information, each Loan Party only represents that such information was prepared in good

 

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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 information.  The Loan Parties have disclosed to the Administrative Agent, in writing furnished by or on behalf of any Loan Party or in information publicly available in periodic and other reports, proxy statements and other materials filed by the Borrower or any Subsidiary with the Securities and Exchange Commission, any and all existing facts that the Loan Parties believe have or are reasonably likely to have (to the extent any of the Loan Parties can now reasonably foresee) a Material Adverse Effect (including the likelihood of material reductions in the rates of reimbursement currently payable to the Borrower and its Subsidiaries by the Medicare and/or Medicaid programs).

 

(j)                                    Margin Regulations.  No Loan Party is engaged in the business of extending credit for the purpose of purchasing or carrying Margin Stock, and no proceeds of any Advance or drawings under any Letter of Credit will be used to purchase or carry any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock.

 

(k)                                 Certain Governmental Regulations.  Neither any Loan Party nor any of its Subsidiaries nor any general partner or managing member of any Loan Party, as applicable, is an “investment company”, or “promoter” or “principal underwriter” for, an “investment company”, as such terms are defined in the Investment Company Act of 1940, as amended.  Without limiting the generality of the foregoing, each Loan Party and each of its Subsidiaries and each general partner or managing member of any Loan Party, as applicable:  (i) is primarily engaged, directly or through a wholly-owned subsidiary or subsidiaries, in a business or businesses other than that of (A) investing, reinvesting, owning, holding or trading in securities or (B) issuing face-amount certificates of the installment type; (ii) is not engaged in, does not propose to engage in and does not hold itself out as being engaged in the business of (A) investing, reinvesting, owning, holding or trading in securities or (B) issuing face-amount certificates of the installment type; (iii) does not own or propose to acquire investment securities (as defined in the Investment Company Act of 1940, as amended) having a value exceeding forty percent (40%) of the value of such company’s total assets (exclusive of government securities and cash items) on an unconsolidated basis; (iv) has not in the past been engaged in the business of issuing face-amount certificates of the installment type; and (v) does not have any outstanding face-amount certificates of the installment type.  Neither the making of any Advances, nor the issuance of any Letters of Credit, nor the application of the proceeds or repayment thereof by the Borrower, nor the consummation of the other transactions contemplated by the Loan Documents, will violate any provision of any such Act or any rule, regulation or order of the Securities and Exchange Commission thereunder.

 

(l)                                     Materially Adverse Agreements.  Neither any Loan Party nor any of its Subsidiaries is a party to any indenture, loan or credit agreement or any lease or other agreement or instrument or subject to any charter, corporate, partnership, membership or other governing restriction that could reasonably be expected to result in a Material Adverse Effect (absent a material default under a Material Contract).

 

(m)                             Perfection and Priority of Security Interests.  Upon the completion of all filings and other actions contemplated by this Agreement, all filings, recordings and other actions necessary to perfect and protect the security interest in the Collateral created under the Collateral Documents will have been duly made or taken and will be in full force and effect, and the Collateral Documents will create in favor of the Collateral Agent for the benefit of the Secured Parties a valid and, together with such filings, recordings and other actions, perfected first priority security interest in the Collateral, securing the payment of the Secured Obligations, and all filings, recordings and other actions necessary to perfect and protect such security interest will have been duly taken.  The Guarantors are the legal and beneficial owners of the Collateral free and clear of any Lien, except for Permitted Liens and the liens and security interests created under the Loan Documents.

 

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(n)                                 Existing Debt.  Set forth on Schedule 4.01(n) to the Disclosure Letter is a complete and accurate list of all Existing Debt (other than Surviving Debt), showing as of the date hereof the obligor and the principal amount outstanding thereunder immediately prior to the Closing Date.

 

(o)                                 Surviving Debt.  Set forth on Schedule 4.01(o) to the Disclosure Letter is a complete and accurate list of all Surviving Debt, showing as of the date hereof the obligor, the principal amount outstanding thereunder (as of January 31, 2017), the maturity date thereof and the amortization schedule therefor.

 

(p)                                 Liens.  Set forth on Part I of Schedule 4.01(p) to the Disclosure Letter is a complete and accurate list of all Liens on the property or assets of any Loan Party that directly or indirectly owns any Borrowing Base Asset.  Set forth on Part II of Schedule 4.01(p) to the Disclosure Letter is a complete and accurate list of all Liens on the property or assets of any Loan Party or any of its Subsidiaries in excess of $1,000,000.00 securing Debt for Borrowed Money, in each case showing as of the date hereof the lienholder thereof, the principal amount of the obligations secured thereby (as of January 31, 2017) and the property or assets of such Loan Party or such Subsidiary subject thereto.  Easements and other real property restrictions, covenants and conditions of record (exclusive of Liens securing Debt) shall not be listed on Schedule 4.01(p) to the Disclosure Letter.

 

(q)                                 Real Property.  (i)  Set forth on Part I of Schedule 4.01(q) to the Disclosure Letter is a complete and accurate list of all real property having a fair market value reasonably estimated by the applicable Loan Party to be in excess of $1,000,000, owned in fee by any Loan Party or any of its Subsidiaries as of the date hereof showing the street address, state, record owner and gross book value thereof (as of December 31, 2016).  Each such Loan Party or Subsidiary has good, marketable and insurable fee simple title to such Real Property, free and clear of all Liens except for Liens permitted by Section 5.02(a).

 

(ii)                                  Set forth on Part II of Schedule 4.01(q) to the Disclosure Letter is a complete and accurate list of all leases of Real Property under which any Loan Party or any of its Subsidiaries is the lessee as of the date hereof showing the street address, state, lessor, lessee, expiration date and annual rental cost thereof.  Each such lease is the legal, valid and binding obligation of the lessor thereof, enforceable in accordance with its terms.

 

(iii)                               Each Borrowing Base Asset is operated and managed by an Approved Manager pursuant to a Management Agreement listed on Part III of Schedule 4.01(q) to the Disclosure Letter.

 

(iv)                              Each Borrowing Base Asset satisfies all Borrowing Base Conditions, other than the Pending Borrowing Base Assets for which the Borrower shall have up to 90 days after the Closing Date to satisfy the Borrowing Base Conditions, provided, that failure to satisfy the Borrowing Base Conditions with respect to any Pending Borrowing Base Asset within such 90 day period shall not constitute a violation of this Section 4.01(q) so long as the Collateral Deliverables for such Pending Borrowing Base Asset have not been received by the Administrative Agent and the Borrowing Base Value for such Pending Borrowing Base Asset remains $0.00 in accordance with the proviso in the definition of “Total Borrowing Base Value”; in the event the Collateral Deliverables for a Pending Borrowing Base Asset are not received within such 90 day period, each such Pending Borrowing Base Asset shall cease to be a Borrowing Base Asset under this Agreement upon the expiration of such 90 day period.

 

(r)                                    Environmental Matters.  (i)  Except as otherwise set forth on Part I of Schedule 4.01(r) to the Disclosure Letter, or as could not reasonably be expected to have a Material Adverse Effect, the operations and properties of each Loan Party and each of its Subsidiaries comply in all material respects with all applicable Environmental Laws and Environmental Permits, all past material non-compliance with such Environmental Laws and Environmental Permits has been

 

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resolved without ongoing material obligations or costs.  To the knowledge of each Loan Party and its Subsidiaries, no circumstances exist that could be reasonably likely to (A) form the basis of an Environmental Action against any Loan Party or any of its Subsidiaries or any of their properties that could have a Material Adverse Effect or (B) cause any such property that is a Borrowing Base Asset to be subject to any material restrictions on ownership, occupancy, use or transferability under any Environmental Law.

 

(ii)                                  Except as otherwise set forth on Part II of Schedule 4.01(r) to the Disclosure Letter or as could not reasonably be expected to have a Material Adverse Effect; to the knowledge of the Loan Parties none of the properties currently or formerly owned or operated by any Loan Party or any of its Subsidiaries is listed or  proposed for listing on the NPL or on the CERCLIS or any analogous foreign, state or local list or is adjacent to any such listed property; to the knowledge of the Loan Parties, there are no underground or above ground storage tanks or any surface impoundments, septic tanks, pits, sumps or lagoons in which Hazardous Materials are being or have been treated, stored or disposed on any property currently owned or operated by any Loan Party or any of its Subsidiaries other than in compliance with applicable law; to the knowledge of the Loan Parties, there is no asbestos or asbestos-containing material on any property currently owned or operated by any Loan Party or any of its Subsidiaries except for any asbestos-containing material that is being managed pursuant to, and in compliance with, an operations and maintenance plan (if required by Environmental Law) and that does not currently require removal, remediation, abatement or encapsulation under Environmental Law; and, to the knowledge of each Loan Party and its Subsidiaries, Hazardous Materials have not been released, discharged or disposed of in violation of any Environmental Law or Environmental Permit on any property currently owned or operated by any Loan Party or any of its Subsidiaries or, to the knowledge of each Loan Party and its Subsidiaries, during the period of their ownership or operation thereof, on any property formerly owned or operated by any Loan Party or any of its Subsidiaries.

 

(iii)                               Except as otherwise set forth on Part III of Schedule 4.01(r) to the Disclosure Letter, neither any Loan Party nor any of its Subsidiaries is undertaking, and has not completed, either individually or together with other potentially responsible parties, any investigation or assessment or remedial or response action relating to any actual or threatened release, discharge or disposal of Hazardous Materials at any site, location or operation, either voluntarily or pursuant to the order of any governmental or regulatory authority or the requirements of any Environmental Law, which in any such case could reasonably be expected to have a Material Adverse Effect; all Hazardous Materials generated, used, treated, handled or stored at, or transported to or from, any property currently or formerly owned or operated by any Loan Party or any of its Subsidiaries have been disposed of in a manner not reasonably expected to result in a Material Adverse Effect; and, with respect to any property formerly owned or operated by any Loan Party or any of its Subsidiaries, all Hazardous Materials generated, used, treated, handled, stored or transported by or, to the knowledge of each Loan Party and its Subsidiaries, on behalf of any Loan Party or any of its Subsidiaries have been disposed of in a manner that could not reasonably be expected to result in a Material Adverse Effect.

 

(s)                                   Compliance with Laws.  Each Loan Party and each Subsidiary is in compliance with the requirements of all laws, rules and regulations (including, without limitation, the Securities Act and the Securities Exchange Act, and the applicable rules and regulations thereunder, state securities law and “Blue Sky” laws) applicable to it and its business, where the failure to so comply could reasonably be expected to result in a Material Adverse Effect.

 

(t)                                    Force Majeure.  Neither the business nor the properties of any Loan Party or any of its Subsidiaries are affected by any fire, explosion, accident, strike, lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act of God or of the public enemy or other casualty

 

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(whether or not covered by insurance) that could reasonably be expected to result in a Material Adverse Effect.

 

(u)                                 Loan Parties’ Credit Decisions.  Each Loan Party has, independently and without reliance upon the Administrative Agent or any other Lender Party and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement (and in the case of the Guarantors, to give the guaranty under this Agreement) and each other Loan Document to which it is or is to be a party, and each Loan Party has established adequate means of obtaining from each other Loan Party on a continuing basis information pertaining to, and is now and on a continuing basis will be completely familiar with, the business, condition (financial or otherwise), operations, performance, properties and prospects of such other Loan Party.

 

(v)                                 Solvency.  Each Loan Party is, individually and together with its Subsidiaries, Solvent.

 

(w)                               Sarbanes-Oxley.  No Loan Party has made any extension of credit to any of its directors or executive officers in contravention of any applicable restrictions set forth in Section 402(a) of Sarbanes-Oxley.

 

(x)                                 ERISA Matters.  (i)  Set forth on Schedule 4.01(x) to the Disclosure Letter is a complete and accurate list of all Plans and Welfare Plans.

 

(ii)                                  No ERISA Event has occurred within the preceding five plan years or is reasonably expected to occur with respect to any Plan that has resulted in or is reasonably expected to result in a material liability of any Loan Party or any ERISA Affiliate.

 

(iii)                               Schedule B (Actuarial Information) to the most recent annual report (Form 5500 Series) for each Plan, copies of which have been filed with the Department of Labor and furnished to the Lender Parties, is complete and accurate and fairly presents the funding status of such Plan as of the date of such Schedule B, and since the date of such Schedule B there has been no material adverse change in such funding status.

 

(iv)                              Neither any Loan Party nor any ERISA Affiliate has incurred or is reasonably expected to incur any Withdrawal Liability to any Multiemployer Plan.

 

(v)                                 Neither any Loan Party nor any ERISA Affiliate has been notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in reorganization or has been terminated, within the meaning of Title IV of ERISA, and no such Multiemployer Plan is reasonably expected to be in reorganization or to be terminated, within the meaning of Title IV of ERISA.

 

(y)                                 Healthcare Matters.  (i)  Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, the Borrower, each Subsidiary thereof, each Healthcare Asset and each Healthcare Service has obtained and maintains in full force and effect all Healthcare Licenses, that it or they, as the case may be, are required to obtain by any Healthcare Requirement.

 

(ii)                                  Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, each Healthcare Asset and Healthcare Service is duly licensed as a skilled-nursing facility, assisted living facility, independent living facility, hospice, or home health agency, as applicable, as and if required by any Healthcare Requirements.

 

(iii)                               Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, none of the Borrower or

 

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any of its Subsidiaries has applied to reduce the number of licensed or certified beds of any Borrowing Base Asset, including beds authorized for use in Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third-party payor arrangement, plan or program, or to move or transfer the right to any and all of the licensed or certified beds of any Borrowing Base Asset to any other location or to amend or otherwise change any Borrowing Base Asset and/or the number of beds approved by the applicable Governmental Authority or if beds are not required to be licensed or certified, to reduce the number of available beds, and, to the knowledge of the Borrower and the other Loan Parties, there are no proceedings or actions pending or contemplated to reduce the number of licensed or certified beds or, if not required to be licensed or certified, to reduce the number of available beds of any Borrowing Base Asset.  The existing number of licensed, certified and/or available bed capacity of each Borrowing Base Asset as of the Closing Date is listed on Schedule II hereto.

 

(iv)                              Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, each Healthcare License with respect to a Borrowing Base Asset (A) has not been and will not be transferred to any new location, (B) is held free from restrictions or known conflicts that would materially impair the use or operation of the applicable Borrowing Base Asset as intended, and (C) is not provisional, probationary, or restricted in any way.

 

(v)                                 Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, neither the Borrower nor any Subsidiary thereof has taken any action to rescind, withdraw, revoke, materially amend, modify, supplement or otherwise materially alter the nature, tenor or scope of any Healthcare License with respect to any Borrowing Base Asset.  No Loan Party has, other than in the normal course of business, changed the terms of its participation in any third party payor arrangements, plans or programs, including, without limitation, Medicare or Medicaid, or its normal billing payment or reimbursement policies and related procedures, including the amount and timing of finance charges, fees and write-offs with respect to any Borrowing Base Asset.

 

(vi)                              Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, the Borrower and its Subsidiaries (and the operation of each Healthcare Asset, each Healthcare Service, Healthcare Staffing Company and Group Purchasing Organization) are and have been within all applicable statutes of limitation in material compliance with all applicable Healthcare Requirements, including, without limitation (A) those relating to staffing requirements, (B) those relating to staff licensure and training, (C) health and fire safety codes, including quality and safety standards, accepted professional standards and principles that apply to professionals providing services at each Healthcare Asset and each Healthcare Service, (D) to the knowledge of any Responsible Officer of Borrower or its Subsidiaries, or any administrator, manager or director of any Healthcare Asset, Healthcare Service, Healthcare Staffing Company or Group Purchasing Organization, 31 U.S.C. §3729 et seq. (the “False Claims Act”), 42 U.S.C. §1320a-7b(b) (the “Anti-Kickback Statute”), and 42 U.S.C. §1395nn and the regulations promulgated thereunder (the “Stark Law”) and all other Federal, state and local laws, rules, regulations or published interpretations or policies relating to the prevention of fraud and abuse and has not committed any act for which it would be prosecuted under 42 U.S.C. §1320a-7a (the “Civil Monetary Penalty Law”), (E) those relating to insurance, reimbursement and cost reporting, (F) government payment program requirements and disclosure of ownership and related information requirements, (G) requirements of applicable Governmental Authorities, including without limitation, those relating to physical structure and environment, licensing, quality and adequacy of care, distributions of pharmaceuticals, rate setting, equipment, personnel, operating policies and services, and fee splitting, and

 

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(H) any other applicable laws, regulations or agreements for reimbursement for the type of care or services provided by the Borrower or its Subsidiaries with respect to any Healthcare Asset, Healthcare Service, Healthcare Staffing Company or Group Purchasing Organization.

 

(vii)                           Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, the Borrower and each Subsidiary of the Borrower, with respect to each Healthcare Asset and each Healthcare Service (A) as applicable, is and has been within all applicable statutes of limitation in material compliance with the requirements for participation in the Medicare, Medicaid, Tricare, Veteran’s Administration, or any other Federal or state healthcare reimbursement program with respect to each Healthcare Asset and each Healthcare Service that currently participates in such programs, (B) as applicable, if it participates in such programs, has a current provider agreement under Medicare, Medicaid or any other Federal or state healthcare reimbursement program, which is in full force and effect, and (C) has no knowledge of any fact which would prevent any third party from assuming or accepting assignment of any Loan Party’s or Borrowing Base Asset’s participation in Medicare, Medicaid or any other Federal or state healthcare reimbursement program, in each case as permitted by and in accordance with applicable law.

 

(viii)                        Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, neither the Borrower nor any Subsidiary thereof is or has been within all applicable statutes of limitation, a named target of, or named participant in, any action, proceeding, suit, audit (other than an audit in the ordinary course of business), subpoena, survey, investigation, sanction or arbitration, at law or equity, or before, by or on behalf of any Governmental Authority or any other administrative, accreditation or investigative body or entity or any other third-party payor or any patient, resident or qui tam relator (including, without limitation, any suit brought pursuant to False Claims Act, the Anti-Kickback Statute, the Stark Law, Civil Monetary Penalty Law, any similar law or any other Federal or state fraud and abuse law), which has resulted or may result, directly or indirectly or with the passage of time, in the imposition of a fine, remedy, penalty, alternative, interim or final sanction, a lower rate certification, a denial of payment, ban on admissions, termination, delicensure, decertification, debarment, recoupment, recovery, suspension or discontinuance of all or part of reimbursement or exclusion from any Governmental Authority, third-party payor, insurance carrier or private payor, a lower reimbursement rate for services rendered to eligible patients or residents, or any other civil or criminal remedy, or which could result in the appointment of a receiver or manager, or in the modification, limitation, annulment, revocation, transfer, surrender, suspension or other impairment of a Healthcare License or affect the Borrower’s, any Subsidiary’s, any Healthcare Asset’s or and Healthcare Service’s  participation in Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third-party payor arrangement, plan or program, as applicable, or any successor program thereto, at current rate certification, nor to its knowledge has any such action, proceeding, suit, investigation, sanction, arbitration or audit been threatened.  An audit, investigation, or written inquiry by a State Medicaid Fraud Control Unit or State Attorney General, by the United States Department of Justice, or by the Office of Inspector General (“OIG”) of the United States Department of Health and Human Services (“HHS”) shall not be considered “in the ordinary course of business”.

 

(ix)                              To the knowledge of the Borrower and the other Loan Parties, except as would not reasonably be expected to have a Material Adverse Effect, there are no agreements with patients or residents of any Healthcare Asset or Healthcare Service or with any other Persons that deviate in any adverse respect from, or which conflict with, any Healthcare Requirements.

 

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(x)                                 To the knowledge of the Borrower and the other Loan Parties, except as would not reasonably be expected to have a Material Adverse Effect, all patient and/or resident records at each Healthcare Asset and the records of individuals that receive services at a Healthcare Asset or from a Healthcare Service, including, without limitation, patient and/or resident accounts records, are true, complete, and correct in all material respects and are and have been within all applicable statutes of limitation maintained in all material respects in accordance with applicable law and Healthcare Requirements.

 

(xi)                              Except as would not cause any Loan Party or any Subsidiary thereof to fail to be in material compliance with any applicable Healthcare Requirements, or as would not reasonably be expected to have a Material Adverse Effect, all claims submitted to Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor arrangement, plan or program by each Healthcare Asset and each Healthcare Service are for items and services actually rendered and in material compliance with Healthcare Requirements, and, all items and services are properly coded and all claims were submitted in material compliance with all Healthcare Requirements regarding billing and claims submission and are supported by adequate and appropriate documentation.

 

(xii)                           None of the execution and delivery of this Agreement or any other Loan Document, the performance hereunder or thereunder by any Loan Party or, to the knowledge of the Borrower, any other party thereto, will, on the Closing Date, (A) adversely affect, in any material respect, the right of the Borrower or any Subsidiary to receive Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor arrangement, plan or program payments or reimbursements, (B) delay or materially reduce the Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor arrangement, plan or program payments or reimbursements that the Borrower or any Subsidiary is receiving as of the date hereof, (C) materially adversely affect any of the Healthcare Licenses; or (D) violate any of the Healthcare Requirements in any material respect.

 

(xiii)                        Except as could not reasonably be expected to have a Material Adverse Effect, no Loan Party or any Subsidiary thereof has received written notice, or is aware, of any violation of applicable antitrust laws.

 

(xiv)                       To the knowledge of the Loan Parties, the Healthcare Licenses and Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor arrangement, plan or program accounts receivable with respect to each Borrowing Base Asset are free of any Liens (other than the Liens created under the Loan Documents and Liens permitted by Section 5.02(a)), and neither the Borrower nor any Subsidiary has pledged any of its receivables as collateral security for any Debt (other than the Obligations of the Loan Parties under the Loan Documents and pledges permitted by Section 5.02(a)).

 

(xv)                          Schedule 4.01(y) to the Disclosure Letter sets forth the collective bargaining agreements and other labor contracts applicable to all persons employed by it at any Borrowing Base Asset as of the Closing Date.

 

(xvi)                       Except as could not reasonably be expected to have a Material Adverse Effect, the Borrower and its Subsidiaries have instituted, and each Healthcare Asset and Healthcare Service is operated in compliance with a compliance plan addressing fraud and

 

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abuse laws, and the compliance plan for each Healthcare Asset or Healthcare Service complies in all material respects with the compliance guidance issued by the OIG.

 

(xvii)                    Except as could not reasonably be expected to have a Material Adverse Effect, the Borrower and its Subsidiaries, the Healthcare Assets and Healthcare Services are and have been within all applicable statutes of limitation in compliance with HIPAA and each Healthcare Asset and each Healthcare Service has in place a HIPAA compliance program and is in material compliance with its HIPAA compliance program.

 

(xviii)                 Except as would not reasonably be expected to have a Material Adverse Effect, there is no threatened or pending revocation, suspension, termination, probation, restriction, limitation, reimbursement recoupment, sanction, penalty or nonrenewal affecting the Borrower, any Subsidiary thereof or any Healthcare Asset, Healthcare Service, or provider agreement with Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor arrangement, plan or program.

 

(xix)                       Except as would not cause any Loan Party to fail to be in compliance with any Healthcare Requirement in such a manner as would reasonably be expected to have a Material Adverse Effect, or as set forth on Schedule 4.01(y) to the Disclosure Letter, all Medicare, Medicaid and any other  applicable third party payor arrangement, plan or program cost reports and other financial reports required to be submitted by or on behalf of each Healthcare Asset and Healthcare Service has been timely filed, and each cost report and other financial report is accurate and complete in all material respects and not misleading in any material respect.

 

(xx)                          Except as set forth on Schedule 4.01(y) to the Disclosure Letter or except as would not reasonably be expected to have a Material Adverse Effect, (A) there are no cost report years that are subject to audits and no cost reports that remain “open” or unsettled, and (B) there are no current or pending Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third-party payor arrangement, plan or program recoupment efforts against any Healthcare Asset or Healthcare Service.

 

(xxi)                       Except as would not reasonably be expected to have a Material Adverse Effect, each Healthcare Asset and the use thereof complies with all applicable material local, state, and Federal building codes, fire codes, healthcare, nursing facility, and other similar regulatory requirements and no material waivers of such physical plant standards exist at any of the Healthcare Assets.

 

(xxii)                    Except as would not reasonably be expected to have a Material Adverse Effect, none of the Borrower, any Subsidiary thereof, any Healthcare Asset or any Healthcare Service is excluded from participation in any Federal or state healthcare program nor as a result of a judicial or administrative proceeding is any of them subject to mandatory or permissive exclusion by the OIG.  Except as would not reasonably be expected to have a Material Adverse Effect, no officers, directors, managers, employees or contractors of the Borrower, any Subsidiary thereof, any Healthcare Asset or any Healthcare Service are excluded from participation in any Federal or state healthcare program, or as a result of a judicial or administrative proceeding subject to mandatory or permissive exclusion by the OIG, or have failed to obtain or maintain any licenses or permits required for the provision of healthcare or related services by such officers, directors, managers, employees or contractors; provided, however, that this Section 4.01(y)(xxii) shall only apply to contractors to the extent any Responsible Officer of Borrower or its Subsidiaries, or any administrator, manager,

 

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director, or employee involved in the hiring of such contractor has knowledge of such condition.

 

(xxiii)                 Except as would not reasonably be expected to result in a Material Adverse Effect (A) each Group Purchasing Organization and each Healthcare Staffing Company is operated and has been within all applicable statutes of limitation in material compliance with the Anti-Kickback Statute, the False Claims Act and all other Healthcare Requirements, (B) each GPO meets the GPO safe harbor under the Anti-Kickback Statute and (C) all personnel placed by each Healthcare Staffing Company are appropriately licensed.

 

(z)                                  OFAC.  None of the Loan Parties or any of their respective Subsidiaries or, to their knowledge, any director, officer, employee, agent or Affiliate thereof, is a Person that is, or is owned or controlled by Persons that are:  (i) the subject of any sanctions administered or enforced by the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), or (ii) located, organized or resident in a country or territory that is, or whose government is, the subject of Sanctions.

 

(aa)                          Anti-Corruption Laws.  None of the Borrower, any Guarantor, or any of their respective Subsidiaries or, to the knowledge the Borrower and the Guarantors, any director, officer, employee, agent or Affiliate thereof, is in violation of any Anti-Corruption Laws.

 

(bb)                          Special Flood Properties.  Either (i) no Borrowing Base Asset is a Flood Hazard Property or (ii) if a Borrowing Base Asset is a Flood Hazard Property, the Borrower or the applicable Loan Party has delivered to the Administrative Agent the Flood Insurance Documents with respect to such Borrowing Base Asset.

 

(cc)                            EEA Financial Institution.  Neither any Loan Party nor any of its Subsidiaries nor any general partner or managing member of any Loan Party, as applicable, is an EEA Financial Institution.

 

ARTICLE V
 COVENANTS OF THE LOAN PARTIES

 

SECTION 5.01                                 Affirmative Covenants.  So long as any Advance or any other Obligation of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have any Commitment hereunder, each Loan Party will:

 

(a)                                 Compliance with Laws, Etc.  Comply, and cause each of its Subsidiaries to comply, in all material respects, with all applicable laws, rules, regulations and orders, such compliance to include, without limitation, compliance with ERISA and the Racketeer Influenced and Corrupt Organizations Chapter of the Organized Crime Control Act of 1970; provided, however, that the failure to comply with the provisions of this Section 5.01(a) shall not constitute a default hereunder so long as such non-compliance is the subject of a Good Faith Contest.

 

(b)                                 Payment of Taxes, Etc.  Pay and discharge, and cause each of its Subsidiaries to pay and discharge, before the same shall become delinquent, (i) all Taxes imposed upon it or upon its property and (ii) all lawful claims that, if unpaid, might by law become a Lien upon its property; provided, however, that neither the Loan Parties nor any of their Subsidiaries shall be required to pay or discharge any such Tax that is the subject of a Good Faith Contest, unless and until any Lien resulting therefrom attaches to its property and becomes enforceable against its other creditors.

 

(c)                                  Compliance with Environmental Laws.  Comply, and cause each of its Subsidiaries and all lessees and other Persons operating or occupying its properties to comply, in all material respects, with all applicable Environmental Laws and Environmental Permits; obtain and renew and

 

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cause each of its Subsidiaries to obtain and renew all Environmental Permits necessary for its operations and properties; and conduct, and cause each of its Subsidiaries to conduct, any investigation, study, sampling and testing, and undertake any cleanup, removal, remedial or other action necessary to remove and clean up all Hazardous Materials from any of its properties in material compliance with the requirements of all Environmental Laws; provided, however, that neither the Loan Parties nor any of their Subsidiaries shall be required to undertake any such cleanup, removal, remedial or other action to the extent that its obligation to do so is the subject of a Good Faith Contest or where the failure to undertake any such cleanup, removal, remedial or other action could not reasonably be expected to result in a Material Adverse Effect.

 

(d)                                 Maintenance of Insurance.

 

(i)                                     Maintain, and cause each of its Subsidiaries to maintain, insurance (including, with respect to the Borrowing Base Assets, the insurance required by the terms of the Mortgages) with responsible and reputable insurance companies or associations in such amounts and covering such risks as is usually carried by companies engaged in similar businesses and owning similar properties in the same general areas in which such Loan Party or such Subsidiaries operate, but in no event shall such amounts with respect to the Borrowing Base Assets be lower or coverages be less comprehensive than the respective insurance amounts and coverages set forth on Schedule 5.01 (d) to the Disclosure Letter; provided, however, that professional liability insurance coverage shall be required only to the extent that such coverage is available at commercially reasonable rates.

 

(ii)                                  If any Borrowing Base Asset is at any time a Flood Hazard Property, then the Borrower shall, or shall cause each applicable Loan Party, to provide to the Administrative Agent the Flood Insurance Documents with respect to such Borrowing Base Asset.  The Administrative Agent shall provide to the Secured Parties copies of the Flood Insurance Documents (including any Flood Insurance Documents delivered in connection with a Flood Compliance Event), to the extent received from the Borrower.  The Administrative Agent agrees to request such Flood Insurance Documents at the request of any Secured Party.  Unless the Borrower provides the Administrative Agent with the Flood Insurance Documents, the Administrative Agent may purchase Flood Insurance meeting the requirements of clause (iii) of the definition of “Flood Insurance Documents” at the Borrower’s expense to protect the interests of the Administrative Agent and the Secured Parties.  The Borrower and each Loan Party shall cooperate with the Administrative Agent in connection with compliance with the Flood Laws, including by providing any information reasonably required by the Administrative Agent (or by any Secured Party through the Administrative Agent) in order to confirm compliance with the Flood Laws.

 

(iii)                               If a Flood Redesignation shall occur with respect to any Borrowing Base Asset, the Administrative Agent shall obtain a completed Flood Hazard Determination with respect to the applicable Borrowing Base Asset, and the Borrower shall provide to the Administrative Agent the Flood Insurance Documents with respect to such Borrowing Base Asset by not later 45 days after the date of the Flood Redesignation or any earlier date required by the Flood Laws.

 

(iv)                              The Borrower shall give to the Administrative Agent written notice of any Flood Compliance Event (other than a Flood Redesignation) not less than 30 days prior to such Flood Compliance Event.  The Administrative Agent shall provide a copy of such notice to the Secured Parties and shall obtain a completed Flood Hazard Determination.  For avoidance of doubt, the Borrower shall provide, or re-provide, as the case may be, to the Administrative Agent the Flood Insurance Documents by not later than the date of the Flood Compliance Event and as a condition precedent to the occurrence of such Flood Compliance Event.

 

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(e)                                  Preservation of Partnership or Corporate Existence, Etc.  Preserve and maintain, and cause each of its Subsidiaries to preserve and maintain, its existence (corporate or otherwise), legal structure, legal name, rights (charter and statutory), permits, licenses, approvals, privileges and franchises, except, in the case of Subsidiaries of the Borrower only, if in the reasonable business judgment of such Subsidiary it is in its best economic interest not to preserve and maintain such rights or franchises and such failure to preserve such rights or franchises could not reasonably be expected to result in a Material Adverse Effect (it being understood that the foregoing shall not prohibit, or be violated as a result of, any transactions by or involving any Loan Party or Subsidiary thereof otherwise permitted under Section 5.02(c) or (d) below).

 

(f)                                   Visitation Rights.  At any reasonable time and from time to time, permit any of the Agents or Lender Parties, or any agent or representatives thereof, upon reasonable prior notice and during regular business hours, to examine and make copies of and abstracts from the records and books of account of, and visit the Borrowing Base Assets, and to discuss the affairs, finances and accounts of any Loan Party with any of their general partners, managing members, officers or directors and with their independent certified public accountants.

 

(g)                                  Keeping of Books.  Keep, and cause each of its Subsidiaries to keep, proper books of record and account, in which full and correct entries shall be made of all financial transactions and the assets and business of such Loan Party and each such Subsidiary in accordance with GAAP.

 

(h)                                 Maintenance of Properties, Etc.  Maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, all of its properties that are used or useful in the conduct of its business in good working order and condition, ordinary wear and tear excepted and will from time to time make or cause to be made all appropriate repairs, renewals and replacement thereof, except in each case where failure to do so could not reasonably be expected to result in a Material Adverse Effect.

 

(i)                                     Transactions with Affiliates.  Conduct, and cause each of its Subsidiaries to conduct, all transactions otherwise permitted under the Loan Documents with any of their Affiliates (other than transactions exclusively among or between the Borrower and/or one or more of the Guarantors or other direct or indirect wholly-owned Subsidiaries) on terms that are fair and reasonable and no less favorable to such Loan Party or such Subsidiary than it would obtain in a comparable arm’s-length transaction with a Person not an Affiliate.

 

(j)                                    Covenant to Guarantee Obligations and Give Additional Security.  (i) Concurrently with the delivery of Collateral Deliverables pursuant to Section 5.01(k) with respect to a Proposed Borrowing Base Asset owned or leased by a Subsidiary of a Loan Party or (ii) within 10 days after the formation or acquisition of any new direct or indirect Subsidiary of a Loan Party that directly owns or leases a Borrowing Base Asset, cause each such Subsidiary (if it has not already done so), to duly execute and deliver to the Administrative Agent (x) a Guaranty Supplement in substantially the form of Exhibit C hereto, or such other guaranty supplement in form and substance reasonably satisfactory to the Administrative Agent, guaranteeing the other Loan Parties’ Obligations under the Loan Documents and (y) a security agreement supplement in form and substance reasonably satisfactory to the Administrative Agent.

 

(k)                                 Borrowing Base Additions.  With the Borrower’s written request to the Administrative Agent that any Asset (a “Proposed Borrowing Base Asset”) be added as a Borrowing Base Asset, deliver (or cause to be delivered) to the Administrative Agent, at the Borrower’s expense, a BBA Proposal Package with respect to such Proposed Borrowing Base Asset.  Within ten (10) Business Days after receipt of a complete BBA Proposal Package, the Administrative Agent shall give notice to the Borrower of whether the Administrative Agent and the Required Lenders have approved such Proposed Borrowing Base Asset as a Borrowing Base Asset subject to the delivery of all applicable Collateral Deliverables and Guarantor Deliverables pursuant to the following sentence (any

 

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such notice comprising an approval, a “Conditional Approval Notice”).  Within 45 days after receipt by the Borrower of a Conditional Approval Notice (which period may be extended in the discretion of the Administrative Agent, at the Borrower’s request, for an additional 30 days without the approval of the Required Lenders), the Borrower shall, at its expense, deliver (or cause to be delivered) to the Administrative Agent all applicable Collateral Deliverables and Guarantor Deliverables, and the Administrative Agent will promptly make copies of the applicable Collateral Deliverables and Guarantor Deliverables available for inspection by the Lenders, which may be via the Approved Electronic Platform.  Notwithstanding the foregoing, the failure of any Proposed Borrowing Base Asset to comply with one or more of the Borrowing Base Conditions shall not preclude the addition of such Proposed Borrowing Base Asset as a Borrowing Base Asset so long as the Administrative Agent and the Required Lenders shall have expressly consented to the addition of such Proposed Borrowing Base Asset as a Borrowing Base Asset notwithstanding the failure to satisfy such conditions.

 

(l)                                     Further Assurances.  (i)  Promptly upon request by any Agent, or any Lender Party through the Administrative Agent, correct, and cause each Loan Party to promptly correct, any material defect or error that may be discovered in any Loan Document or in the execution, acknowledgment, filing or recordation thereof.

 

(ii)                                  Promptly upon request by any Agent, or any Lender Party through the Administrative Agent, do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such further acts, deeds, conveyances, pledge agreements, account control agreements, mortgages, deeds of trust, trust deeds, assignments of leases and rents, assignments, financing statements and continuations thereof, termination statements, notices of assignment, transfers, certificates, assurances and other instruments as any Agent, or any Lender Party through the Administrative Agent, may reasonably require from time to time in order (A) to carry out more effectively the purposes of the Loan Documents, (B) to the fullest extent permitted by applicable law, to subject any Loan Party’s or any of its Subsidiaries’ properties, assets, rights or interests to the Liens now or hereafter intended to be covered by any of the Collateral Documents, (C) to perfect and maintain the validity, effectiveness and priority of any of the Collateral Documents and any of the Liens intended to be created thereunder and (D) to assure, convey, grant, assign, transfer, preserve, protect and confirm more effectively unto the Secured Parties the rights granted or now or hereafter intended to be granted to the Secured Parties under any Loan Document or under any other instrument executed in connection with any Loan Document to which any Loan Party or any of its Subsidiaries is or is to be a party, and cause each of its Subsidiaries to do so.  Without limitation of the foregoing provisions of this Section 5.01(l), in the event that the Borrower changes its name following the Closing Date, the Borrower will, promptly upon request by the Administrative Agent, deliver a ratification of the Loan Documents and replacement Notes reflecting the Borrower’s new name.

 

(m)                             Performance of Material Contracts.  Except where the failure to do so could not reasonably be expected to have a Material Adverse Effect, perform and observe, and cause each of its Subsidiaries to perform and observe, all the terms and provisions of each Material Contract to be performed or observed by it, maintain each such Material Contract in full force and effect, enforce each such Material Contract in accordance with its terms, take all such action to such end as may be from time to time reasonably requested by the Administrative Agent, in each case with respect to any Borrowing Base Asset, and, upon the reasonable request of the Administrative Agent, make to each other party to each such Material Contract with respect to a Borrowing Base Asset, such demands and requests for information and reports or for action as any Loan Party or any of its Subsidiaries is entitled to make under such Material Contract, and cause each of its Subsidiaries to do so.

 

(n)                                 Compliance with Leases.  Except where, in each case, the failure to do so could not reasonably be expected to have a Material Adverse Effect, (a) make all payments and otherwise perform all obligations in respect of all leases of real property to which the Borrower or any of its

 

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Subsidiaries is a party, keep such leases in full force and effect and not allow such leases to lapse or be terminated or any rights to renew such leases to be forfeited or cancelled (except, in the case of Subsidiaries of the Borrower only, if in the reasonable business judgment of such Subsidiary it is in its best economic interest not to maintain such lease or prevent such lapse, termination, forfeiture or cancellation and such failure to maintain such lease or prevent such lapse, termination, forfeiture or cancellation is not in respect of a Qualifying Ground Lease of a Borrowing Base Asset and could not otherwise reasonably be expected to result in a Material Adverse Effect), (b) notify the Administrative Agent of any material default by any party with respect to such leases and (c) cooperate with the Administrative Agent in all respects to cure any such default, and cause each of its Subsidiaries to do so.

 

(o)                                 Qualifying Ground Leases.  With respect to any Qualifying Ground Lease related to any Borrowing Base Asset:

 

(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 Qualifying Ground Lease and its rights thereunder;

 

(iv)                              diligently and continuously enforce the material obligations of the lessor or other obligor thereunder;

 

(v)                                 deliver to the Administrative Agent all default and other material notices received by it or sent by it under the applicable Qualifying Ground Lease;

 

(vi)                              upon the Administrative Agent’s reasonable written request and at reasonable intervals, unless an Event of Default shall have occurred and be continuing, in which case, upon written request at any time, provide to the Administrative Agent any information or materials relating to such Qualifying Ground Lease and evidencing the applicable Guarantor’s due observance and performance of its material obligations thereunder;

 

(vii)                           execute and deliver (to the extent permitted to do so under such Qualifying Ground Lease), upon the request of the Administrative Agent, any documents, instruments or agreements as may be required to permit the Administrative Agent to cure any default of the Loan Party under such Qualifying Ground Lease;

 

(viii)                        provide to the Collateral Agent written notice of its intention to exercise any option or renewal or extension rights with respect to such Qualifying Ground Lease at least thirty (30) days prior to the expiration of the time to exercise such right or option and, upon the direction of the Administrative Agent, duly exercise any renewal or extension option with respect to such Qualifying Ground Lease (provided that each Loan Party hereby appoints the Collateral Agent its attorney-in-fact, coupled with an interest, to execute and deliver, for and in the name of such Person, all instruments, documents or agreements necessary to extend or renew such Qualifying Ground Lease);

 

(ix)                              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 Qualifying Ground Lease within the applicable time period therefore in such

 

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proceedings, notwithstanding any rejection by such ground lessor or obligor or trustee, custodian or receiver related thereto;

 

(x)                                 provide to the Administrative Agent not less than thirty (30) days prior written notice of the date on which the applicable Guarantor shall apply to any court or other Governmental Authority for authority or permission to reject the applicable Qualifying Ground Lease in the event that there shall be filed by or against any Guarantor any petition, action or proceeding under Bankruptcy Law or any similar federal or state law; provided, however, that the Administrative Agent shall have the right, but not the obligation, to serve upon the applicable Guarantor within such thirty (30) day period a notice stating that (1) the Administrative Agent demands that such Guarantor assume and then assign the relevant Qualifying Ground Lease to the Administrative Agent subject to and in accordance with Bankruptcy Law and (2) the Administrative Agent covenants to cure or provide reasonably adequate assurance thereof with respect to all defaults susceptible of being cured by the Administrative Agent and of future performance under the applicable Qualifying Ground Lease; provided further that if the Administrative Agent serves such notice upon the applicable Guarantor, such Guarantor shall not seek to reject the applicable Qualifying Ground Lease and shall promptly comply with such demand;

 

(xi)                              permit the Collateral Agent (at its option), during the continuance of any Event of Default, to (1) perform and comply with all obligations under the applicable Qualifying Ground Lease; (2) do and take such action as the Collateral Agent reasonably deems necessary or desirable to prevent or cure any default by such Guarantor under such Qualifying Ground Lease and (3) enter in and upon the applicable premises related to such Qualifying Ground Lease to the extent and as often as the Administrative Agent reasonably deems necessary or desirable in order to prevent or cure any default under the applicable Qualifying Ground Lease;

 

(xii)                           if such event could reasonably be expected to result in a Material Adverse Effect, in the event of any arbitration, court or other adjudicative proceedings under or with respect to any such Qualifying Ground Lease, permit the Administrative Agent (at its option) to exercise all right, title and interest of the applicable Guarantor in connection with such proceedings, provided that (i) each Loan Party hereby irrevocably appoints the Administrative Agent as its attorney-in-fact (which appointment shall be deemed coupled with an interest) to exercise such right, interest and title and (ii) the Loan Parties shall bear all costs, fees and expenses related to such proceedings; provided further that each Loan Party hereby further agrees that the Administrative Agent shall have the right, but not the obligation, to proceed in respect of any claim, suit, action or proceeding relating to the rejection of any of the Qualifying Ground Lease referenced above by the relevant ground lessor as a result of bankruptcy or similar proceedings (including, without limitation, the right to file and prosecute all proofs of claims, complaints, notices and other documents in any such bankruptcy case or similar proceeding); and

 

(xiii)                        at reasonable times and at reasonable intervals, deliver to the Collateral Agent (or, subject to the requirements of the subject Qualifying Ground Lease, cause the applicable lessor or other obligor to deliver to the Administrative Agent), an estoppel certificate and consent agreement in relation to such Qualifying Ground Lease in form and substance reasonably acceptable to the Collateral Agent, in its discretion, and, in the case of the estoppel certificate, setting forth (i) the name of lessee and lessor under the Qualifying Ground Lease (if applicable); (ii) that such Qualifying Ground Lease is in full force and effect and has not been modified except to the extent the Collateral Agent has received notice of such modification; (iii) that no rental and other payments due thereunder are delinquent as of the date of such estoppel; and (iv) whether such Person knows of any actual or alleged defaults or events of default under the applicable Qualifying Ground Lease,

 

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provided that each Loan Party hereby agrees to execute and deliver to the Administrative Agent, within ten (10) days of any request therefor, such documents, instruments, agreements, assignments or other conveyances reasonably requested by the Administrative Agent in connection with or in furtherance of any of the provisions set forth above or the rights granted to the Administrative Agent in connection therewith.

 

(p)                                 Management Agreements.  At all times cause each Borrowing Base Asset to be managed and operated by an Approved Manager that has (i) entered into a management agreement with respect to such Asset in form and substance reasonably satisfactory to the Administrative Agent, and (ii) executed and delivered a management agreement subordination agreement in form and substance reasonably satisfactory to the Administrative Agent.  Lender Parties acknowledge that the Management Agreements in effect as of the date hereof are satisfactory.

 

(q)                                 Exchange Listing.  In the case of the Borrower, at all times cause its common shares to be, and remain, duly listed on The NASDAQ Stock Market LLC, the New York Stock Exchange or any other national securities exchange.

 

(r)                                    Sarbanes-Oxley.  Comply at all times in all material respects with all applicable provisions of Section 402 (a) of Sarbanes-Oxley, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect.

 

(s)                                   Insurance Proceeds and Condemnation Awards.  (i)  In the event of any loss or damage to any portion of any Borrowing Base Asset due to fire or other casualty, or any taking of any portion of any Borrowing Base Asset by condemnation or under power of eminent domain and provided that the Borrower does not designate the Borrowing Base Asset suffering such loss as a non-Borrowing Base Asset in accordance with Section 5.02(e), the Collateral Agent shall have the right, but not the obligation, after the occurrence and during the continuation of an Event of Default, to settle insurance claims and condemnation claims or awards, unless the loss or damage is less than $5,000,000.  If (A) the loss or damage is less than $5,000,000 or (B) if the Collateral Agent elects not to settle such claim or award, then the applicable Loan Party shall have the right to settle such claim or award without the consent of the Collateral Agent, provided that (1) such Loan Party shall use the proceeds of any claim or award to rebuild or restore the applicable Borrowing Base Asset substantially to its condition prior to the casualty or condemnation to the extent permitted by applicable law and (2) such Loan Party shall provide the Collateral Agent with notice of the casualty or condemnation.  In all other cases, the applicable Loan Party shall not settle such claim or award without the prior or concurrent written consent of the Collateral Agent.  So long as such Borrowing Base Asset remains a Borrowing Base Asset, failure to use the insurance proceeds received directly from the insurance company to rebuild and restore the Borrowing Base Asset shall constitute an Event of Default.  The Collateral Agent shall have the right (but not the obligation) to collect, retain and apply to the Obligations all insurance and condemnation proceeds (after deduction of all expense of collection and settlement, including reasonable attorney and adjusters’ fees and expenses) in the event that an Event of Default exists under this Agreement or the other Loan Documents or the Borrowing Base Asset no longer meets the Borrowing Base Conditions (other than as a result of such loss or damage).  Otherwise, all proceeds shall be delivered to the Borrower.  Any proceeds remaining after application to the Obligations shall be paid by the Collateral Agent to the Borrower or the party then entitled thereto.

 

(ii)                                  Provided that the Borrower has not designated the affected asset as a non-Borrowing Base Asset in accordance with Section 5.02(e), if the Collateral Agent does not elect to or is not entitled to apply casualty proceeds or condemnation awards to the Obligations and if the Loan Parties are not entitled to settle such claims, all as provided under the foregoing subsection (i), the Collateral Agent shall have the right (but not the obligation) to settle, collect and retain such proceeds, and after deduction of all reasonable expenses of collection and settlement, including reasonable attorney and adjusters’ fees and expenses, to

 

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release the same to the applicable Loan Party periodically, provided that such Loan Party shall:

 

(A)                               expeditiously repair and restore all damage to the portion of the Borrowing Base Asset in question resulting from such casualty or condemnation, including completion of the construction if such fire or other casualty shall have occurred prior to completion, so that the Borrowing Base Asset continues to qualify as a Borrowing Base Asset following such construction; and

 

(B)                               if the casualty proceeds or condemnation awards are, in the Collateral Agent’s reasonable judgment, insufficient to complete the repair and restoration of the buildings, structures and other improvements constituting the Borrowing Base Asset as aforesaid, then the Loan Parties shall promptly deposit with the Collateral Agent the amount of such deficiency.

 

Any request by a Loan Party for a disbursement by the Collateral Agent of casualty proceeds or condemnation awards by the Borrower pursuant to this Section 5.01(s) and the disbursement thereof shall be conditioned upon the Loan Parties’ compliance with and satisfaction of the same conditions precedent as would be applicable in connection with construction loans made by institutional lenders for projects similar to the affected Borrowing Base Asset, including approval of plans and specifications, submittal of evidence of completion, updated title insurance, lien waivers, and other customary safeguards.

 

(t)                                    Healthcare Requirements.  Except where the failure to do so would not reasonably be expected to have a Material Adverse Effect, cause the operations conducted or to be conducted at each Healthcare Asset and each Healthcare Service, at a minimum, to be conducted in a manner consistent in all material respects with all applicable Healthcare Requirements and, in connection therewith, the Borrower and the Loan Parties further covenant that (in each case, except to the extent that the same would not reasonably be expected to have a Material Adverse Effect):

 

(i)                                     the storage, use, transportation and disposal of all medical equipment, medical supplies, medical products or gases, and medical waste, of any kind and in any form, will be maintained in material compliance with all Healthcare Requirements;

 

(ii)                                  each Healthcare Asset and each Healthcare Service will be operated in material compliance with applicable Healthcare Requirements relating thereto, reimbursement or care contracts, and any other agreements necessary for the certification, licensure or operation of such Healthcare Asset or Healthcare Service as may be necessary for participation in Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor arrangement, plan or program, to the extent applicable;

 

(iii)                               each Healthcare Asset that is a Borrowing Base Asset will remain in effect without material reduction in the number of licensed beds or certified beds;

 

(iv)                              all deposits relating to Healthcare Requirements, including deposits relating to residents or residency agreements will be maintained in material compliance with all applicable regulatory requirements.  If such deposits are in cash, the Borrower and its Subsidiaries shall deposit and hold such deposits in accordance with applicable law;

 

(v)                                 the Borrower and its Subsidiaries shall file all required Medicare or Medicaid cost reports on or prior to the date such reports are due and make available to the Administrative Agent, if requested (within 90 days of the date of such request), a complete and accurate copy of the annual Medicare or Medicaid cost report for the Borrower and its Subsidiaries with respect to the Borrowing Base Assets and subject to privacy limitations

 

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under applicable law, which will be prepared by the Borrower or applicable Subsidiary and accompanied by a certificate from a Responsible Officer of the Borrower certifying as of the date thereof that such report is accurate, complete and not misleading, and promptly furnish the Administrative Agent any amendments filed with respect to such reports and all notices, responses, audit reports or inquiries with respect to such reports; and

 

(vi)                              the Borrower shall cause all residency and other agreements with residents of the Healthcare Assets to comply with all legal requirements and Healthcare Requirements.

 

SECTION 5.02                                 Negative Covenants.  So long as any Advance or any other Obligation of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have any Commitment hereunder, no Loan Party will, at any time:

 

(a)                                 Liens, Etc.  Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Lien on or with respect to any Borrowing Base Asset of any character (including, without limitation, accounts), except:

 

(i)                                     Liens created under the Loan Documents;

 

(ii)                                  Permitted Liens;

 

(iii)                               Liens described on Schedule 4.01(p) to the Disclosure Letter;

 

(iv)                              purchase money Liens upon or in equipment acquired or held by any Guarantor in the ordinary course of business to secure the purchase price of such equipment or to secure Debt incurred solely for the purpose of financing the acquisition of any such equipment to be subject to such Liens, or Liens existing on any such equipment at the time of acquisition (other than any such Liens created in contemplation of such acquisition that do not secure the purchase price), or extensions, renewals or replacements of any of the foregoing for the same or a lesser amount; provided, however, that no such Lien shall extend to or cover any property other than the equipment being acquired, and no such extension, renewal or replacement shall extend to or cover any property not theretofore subject to the Lien being extended, renewed or replaced; provided further that the aggregate principal amount of the Debt secured by Liens permitted by this clause (iv) shall not exceed the amount permitted under Section 5.02(b)(iii);

 

(v)                                 Liens arising in connection with Capitalized Leases permitted under Section 5.02(b)(iv), provided that no such Lien shall extend to or cover any Collateral or assets other than the assets subject to such Capitalized Leases; and

 

(vi)                              any other Liens, provided, that the Loan Parties shall be in compliance with the covenants contained in Section 5.04 both immediately prior to and on a pro forma basis immediately after giving effect to the incurrence of such Liens.

 

(b)                                 Debt.  With respect to the Guarantors only, create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt, except:

 

(i)                                     Debt under the Loan Documents;

 

(ii)                                  Debt owed to any other Loan Party or any wholly-owned Subsidiary of any Loan Party, provided that, in each case, such Debt (y) shall be on terms reasonably acceptable to the Administrative Agent and (z) shall be evidenced by promissory notes in form and substance satisfactory to the Administrative Agent, which promissory notes shall (unless payable to the Borrower) by their terms be subordinated to the Obligations of the Loan Parties under the Loan Documents;

 

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(iii)                               Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $5,000,000 at any time outstanding,

 

(iv)                              Capitalized Leases not to exceed in the aggregate $5,000,000 at any time outstanding,

 

(v)                                 the Surviving Debt described on Schedule 4.01(o) to the Disclosure Letter and any Refinancing Debt extending, refunding or refinancing such Surviving Debt,

 

(vi)                              Debt represented by cash management obligations and other obligations in respect of netting services, automatic clearinghouse arrangements, overdraft protections and similar arrangements in each case in connection with deposit accounts,

 

(vii)                           endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and

 

(viii)                        any other Debt, provided, that the Loan Parties shall be in compliance with the covenants contained in Section 5.04 both immediately prior to and on a pro forma basis immediately after giving effect to the incurrence of such Debt.

 

(c)                                  Change in Nature of Business.  Make, or permit any of its Subsidiaries to make, any material change in the nature of its business as carried at the Closing Date (after giving effect to the transactions contemplated by the Loan Documents).

 

(d)                                 Mergers, Etc.  Merge or consolidate with or into, or convey, transfer (except as permitted by Section 5.02 (e)), lease or otherwise dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to, any Person, or permit any of its Subsidiaries to do so; provided, however, that (i) any Subsidiary of a Loan Party may merge or consolidate with or into, or dispose of assets to, any other Subsidiary of such Loan Party (provided that if one or more of such Subsidiaries is also a Loan Party, a Loan Party shall be the surviving entity) or any other Loan Party other than the Borrower (provided that such Loan Party or, in the case of any Loan Party other than the Borrower, another Loan Party shall be the surviving entity), and (ii) any Loan Party may merge with any Person that is not a Loan Party so long as such Loan Party is the surviving entity or (except in the case of a merger with the Borrower, which shall always be the surviving entity) such other Person is the surviving party and shall promptly become a Loan Party, provided, in each case, that (A) no Default shall have occurred and be continuing at the time of such proposed transaction or would result therefrom and (B) the Borrower shall have delivered to the Administrative Agent a Borrowing Base Certificate demonstrating that the Facility Available Amount (calculated on a pro forma basis after giving effect to such merger) will be greater than or equal to the Facility Exposure.  Notwithstanding any other provision of this Agreement, (x) any Subsidiary of a Loan Party that is not itself a Loan Party may merge or consolidate with or into, or convey all or substantially all of its assets (whether now owned or hereafter acquired) to, any Person, so long as such transaction, to the extent resulting in a direct or indirect Transfer of assets, complies with Section 5.02(e), mutatis mutandis, the Borrower determines in good faith that such proposed transaction is in the best interests of the Borrower, and no Default or Event of Default shall have occurred and be continuing at the time of such proposed transaction or would result therefrom, (y) any Subsidiary of a Loan Party that is not itself a Loan Party may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and the assets or proceeds from the liquidation or dissolution of such Subsidiary are transferred to the Borrower or a wholly-owned Subsidiary of Borrower, provided that no Default or Event of Default shall have occurred and be continuing at the time of such proposed transaction or would result therefrom, and (z) any Loan Party or Subsidiary of a Loan Party shall be permitted to effect any Transfer of Assets through the sale or transfer of direct or indirect Equity Interests in the Person (other than the Borrower) that owns such Assets so long as Section 5.02(e)

 

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would otherwise permit the Transfer of all Assets owned by such Person at the time of such sale or transfer of such Equity Interests.  Upon the sale or transfer of Equity Interests in any Person that is a Guarantor permitted under clause (z) above, provided that no Default or Event of Default shall have occurred and be continuing or would result therefrom, the Administrative Agent shall, upon the request of the Borrower, release such Guarantor from the Guaranty and the Collateral Documents.

 

(e)                                  Sales, Etc. of Assets.  Sell, lease (other than by entering into Tenancy Leases), transfer or otherwise dispose of, or grant any option or other right to purchase, lease (other than any option or other right to enter into Tenancy Leases) or otherwise acquire, or permit any of its Subsidiaries to sell, lease (other than by entering into Tenancy Leases), transfer or otherwise dispose of, or grant any option or other right to purchase, lease (other than any option or other right to enter into Tenancy Leases) or otherwise acquire (each such action described in this subsection (e), including, without limitation, any Sale and Leaseback Transaction, being a “Transfer”), any Asset or Assets (or any direct or indirect Equity Interests in the owner thereof), in each case other than (x) the Transfer of any asset with a gross book value equal to $1,000,000 or less in the ordinary course of business on arm’s length terms, and (y) the following Transfers, which shall be permitted hereunder only so long as no Default or Event of Default shall exist or would result therefrom:

 

(i)                                     the Transfer of any assets that are not Borrowing Base Assets or direct or indirect Equity Interests in Borrowing Base Assets to any Person (including, without limitation, the Transfer of any Transfer Healthcare Asset), provided, that the Loan Parties shall be in compliance with the covenants contained in Section 5.04 both immediately prior to and on a pro forma basis immediately after giving effect to such Transfer;

 

(ii)                                  the lease or sublease of assets, as lessor or sublessor (as the case may be), in the ordinary course of business,

 

(iii)                               the Transfer of any Borrowing Base Asset or Borrowing Base Assets to any Person, or the designation of a Borrowing Base Asset or Borrowing Base Assets as a non-Borrowing Base Asset or non-Borrowing Base Assets, in each case with the intention that such Borrowing Base Asset or Borrowing Base Assets, upon consummation of such Transfer or designation, shall no longer constitute a Borrowing Base Asset or Borrowing Base Assets, provided that:

 

(A)                               immediately after giving effect to such Transfer or designation, as the case may be, the remaining Borrowing Base Assets shall continue to satisfy the requirements set forth in clauses (a) through (h) of the definition of Borrowing Base Conditions,

 

(B)                               immediately after giving effect to such Transfer or designation, as the case may be, the Borrowing Base Debt Service Coverage Ratio of all remaining Borrowing Base Assets (measured on a pro forma basis as of the date immediately following such Transfer) shall not be less than 1.50:1.00,

 

(C)                               the Loan Parties shall be in compliance with the covenants contained in Section 5.04 both immediately prior to and on a pro forma basis immediately after giving effect to such Transfer or designation,

 

(D)                               on or prior to the date of such Transfer or designation, as the case may be, the Borrower shall have delivered to the Administrative Agent (A) a Borrowing Base Certificate demonstrating that the Facility Available Amount (calculated on a pro forma basis after giving effect to such Transfer and to any repayment of Advances made at the time thereof) will be greater than or equal to the Facility Exposure, and (B) a certificate of the Chief Financial Officer (or other Responsible Officer performing similar functions) of the Borrower demonstrating

 

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compliance with the foregoing clauses (A) through (D) and confirming that no Default or Event of Default shall exist on the date of such Transfer or will result therefrom, together with supporting information in detail reasonably satisfactory to the Administrative Agent, and

 

(E)                                the Administrative Agent and the Required Lenders shall have consented in writing to such Transfer or designation prior to the consummation thereof (except in the case of the Transfer or designation of up to five Borrowing Base Assets in the aggregate during the term of the Facility that the Borrower or any other Loan Party may elect to Transfer or designate without the consent of the Administrative Agent and the Required Lenders), it being agreed that the Administrative Agent shall give notice to the Borrower of whether the Administrative Agent and the Required Lenders have consented to such Transfer or designation within ten (10) Business Days after receipt of request therefor from the Borrower together with such supporting information in reasonable detail consistent with the requirements of clauses (A) through (D) above as the Administrative Agent shall reasonably request,

 

(iv)                              the Transfer of inventory in the ordinary course of business, and

 

(v)                                 the sale, transfer or disposal of assets in transactions solely among one or more of the Borrower and its Subsidiaries (other than the Transfer of any Borrowing Base Asset or Borrowing Base Assets or any direct or indirect Equity Interests therein, except to the extent permitted by Section 5.02(e)(iii)).

 

Following (I) a Transfer of a portion or all Borrowing Base Assets owned and leased by a Guarantor in accordance with Section 5.02(e)(iii) or (II) the designation by a Guarantor of a portion or all Borrowing Base Assets owned or leased by it as non-Borrowing Base Assets pursuant to Section 5.02(e)(iii), the Administrative Agent shall, upon the request of the Borrower and at the Borrower’s expense, promptly release any mortgages, deeds of trust, security agreement, and UCC financing statements from such transferred Borrower Base Assets or assets designated as non-Borrowing Base Assets.  Further, following (x) a Transfer of all Borrowing Base Assets owned or leased by a Guarantor in accordance with Section 5.02(e)(iii) or (y) the designation by a Guarantor of all Borrowing Base Assets owned or leased by it as non-Borrowing Base Assets pursuant to Section 5.02(e)(iii), the Administrative Agent shall, upon the request of the Borrower and at the Borrower’s expense, promptly release such Guarantor from the Guaranty and the Security Agreement.

 

(f)                                   Investments.  Make or hold, or permit any of its Subsidiaries to make or hold, any Investment, or otherwise own the following items such that the aggregate value of such Investments of such Persons exceeds at any time the specified percentages of Total Asset Value set forth below:

 

(i)                                     Investments in Healthcare Assets (including by asset or Equity Interest acquisitions or investments in Joint Ventures, in each case subject, where applicable, to the limitations set forth below in this Section 5.02(f));

 

(ii)                                  Investments in Joint Ventures such that the aggregate value of such Investments (determined in a manner consistent with the definition of Total Asset Value or, if not contemplated under the definition of Total Asset Value, as determined in accordance with GAAP) exceeds 20% of Total Asset Value at any time;

 

(iii)                               Investments in Development Assets such that the aggregate Construction Budget for all such Development Assets exceeds 15% of Total Asset Value at any time.  For purposes of this clause:  (x) “Construction Budget” means the fully budgeted costs for the acquisition and construction of a given piece of real property (including, without limitation, the cost of acquiring such piece of real property (except to the extent any portion thereof is

 

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unimproved land included in clause (iv) below), reserves for construction interest and operating deficits, tenant improvements, leasing commissions, and infrastructure costs), as reasonably determined by the Borrower in good faith and (y) real property under construction to be (but not yet) acquired by the Borrower or a Subsidiary thereof upon completion of construction pursuant to a contract in which the seller of such real property is required to complete construction prior to, and as a condition precedent to, such acquisition, shall be subject to this clause (ii);

 

(iv)                              Investments in Mortgage Receivables such that the aggregate book value of such Mortgage Receivables exceeds 10% of Total Asset Value at any time;

 

(v)                                 Investments in unimproved land such that the aggregate book value of all such unimproved land exceeds 5% of Total Asset Value at any time;

 

(vi)                              Investments in Cash Equivalents;

 

(vii)                           Investments consisting of intercompany Debt permitted under Section 5.02(b)(ii);

 

(viii)                        Investments outstanding on the date hereof in Subsidiaries that are not wholly-owned by any Loan Party;

 

(ix)                              Investments in Subsidiaries that are wholly-owned by any Loan Party;

 

(x)                                 Investments by the Borrower in Hedge Agreements permitted under Section 5.02(j);

 

(xi)                              To the extent permitted by applicable law, loans or other extensions of credit to officers, directors and employees of any Loan Party or any Subsidiary of any Loan Party in the ordinary course of business, for travel, entertainment, relocation and analogous ordinary business purposes, which Investments shall not exceed at any time $1,000,000 in the aggregate for all Loan Parties; and

 

(xii)                           Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss.

 

(g)                                  Restricted Payments.  In the case of the Borrower, without the prior consent of the Required Lenders, declare or pay any dividends, purchase, redeem, retire, defease or otherwise acquire for value any of its Equity Interests now or hereafter outstanding, return any capital to its stockholders, partners or members (or the equivalent Persons thereof) as such, make any distribution of assets, Equity Interests, obligations or securities to its stockholders, partners or members (or the equivalent Persons thereof) as such; provided, however, that (i) the Borrower may take such actions only so long as no Default or Event of Default shall have occurred and be continuing, and (ii) payments described in this Section 5.02(g) shall only be permitted so long as after giving effect to each such payment, the sum of (A) the Facility Available Amount less the Facility Exposure plus (B) the aggregate amount of Unrestricted Cash held by the Borrower is not less than $10,000,000.

 

(h)                                 Amendments of Constitutive Documents.  Amend, or permit any of its Subsidiaries to amend, in each case in a manner that could reasonably be expected to have a Material Adverse Effect, its limited liability company agreement, partnership agreement, certificate of incorporation or bylaws or other constitutive documents, provided that any amendment to any such constitutive document that would be adverse to any of the Secured Parties shall be deemed “material” for purposes of this Section; and provided further that any amendment to any such constitutive document that

 

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would designate such Subsidiary as a “special purpose entity” or otherwise confirm such Subsidiary’s status as a “special purpose entity” shall be deemed “not material” for purposes of this Section.

 

(i)                                     Accounting Changes.  Make or permit, or permit any of its Subsidiaries to make or permit, any change in (i) accounting policies or reporting practices, except as required or permitted by generally accepted accounting principles, or (ii) Fiscal Year.

 

(j)                                    Speculative Transactions.  Engage, or permit any of its Subsidiaries to engage, in any transaction involving commodity options or futures contracts or any similar speculative transactions, provided, however, that the Borrower shall be permitted to enter into Hedge Agreements designed to hedge against fluctuations in interest rates or foreign exchange rates incurred in the ordinary course of business and consistent with prudent business practices.

 

(k)                                 OFAC.  Knowingly engage in any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is, or whose government is, the subject of Sanctions.

 

(l)                                     Amendment, Etc. of Material Contracts.  Cancel or terminate any Material Contract or consent to or accept any cancellation or termination thereof, amend or otherwise modify any Material Contract or give any consent, waiver or approval thereunder, waive any default under or breach of any Material Contract, agree in any manner to any other amendment, modification or change of any term or condition of any Material Contract or take any other action in connection with any Material Contract that would impair in any material respect the value of the interest or rights of any Loan Party thereunder or that would impair or otherwise adversely affect in any material respect the interest or rights, if any, of any Agent or any Lender Party, or permit any of its Subsidiaries to do any of the foregoing in each case taking into account the effect of any agreements that supplement or serve to substitute for, in whole or in part, such Material Contract, and in the case of a Material Contract not affecting any Borrowing Base Asset, in a manner that could reasonably be expected to have a Material Adverse Effect.

 

(m)                             [Intentionally Omitted].

 

(n)                                 [Intentionally Omitted].

 

(o)                                 Multiemployer Plans.  Contribute to or be required to contribute to, nor will any ERISA Affiliate contribute to or be required to contribute to, any Multiemployer Plan.

 

(p)                                 Ground Leases.  With respect to any Qualifying Ground Lease with respect to any Borrowing Base Asset:

 

(i)                                     waive, excuse or discharge any of the material obligations of the lessor or other obligor thereunder;

 

(ii)                                  do, permit or suffer (1) any act, event or omission which would be likely to result in a default or permit the applicable lessor or other obligor to terminate or exercise any other remedy with respect to the applicable Qualifying Ground Lease or (2) any act, event or omission which, with the giving of notice or the passage of time, or both, would constitute a default or permit the lessor or such other obligor to exercise any other remedy under the applicable Qualifying Ground Lease;

 

(iii)                               cancel, terminate, surrender, modify or amend any of the provisions of any such Qualifying Ground Lease or agree to any termination, amendment, modification or surrender thereof without the prior written consent of the Administrative Agent;

 

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(iv)                              permit or consent to the subordination of such Qualifying Ground Lease to any mortgage or other leasehold interest of the premises related thereto; or

 

(v)                                 treat, in connection with the bankruptcy or other insolvency proceedings of any ground lessor or other obligor, any Qualifying Ground Lease as terminated, cancelled or surrendered pursuant to Bankruptcy Law without the Administrative Agent’s prior written consent.

 

(q)                                 Healthcare.  Without the prior written consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) and authorization and/or approval under all applicable law and Healthcare Requirements, assign or transfer (or permit any Subsidiary thereof to assign or transfer), except to the Borrower or another Subsidiary thereof as authorized under all applicable law and Healthcare Requirements, any of its interest in any Healthcare License or reimbursement or care contracts (including rights to payment thereunder), including any Medicare, Medicaid, Tricare, Veteran’s Administration, any other Federal or state healthcare reimbursement program, or a managed care company, insurance company, and/or any other third party payor agreements, pertaining to the Borrower, any Subsidiary thereof or any Healthcare Asset or Healthcare Service, provided that the foregoing shall not be prohibited by this Agreement to the extent it is in connection with a sale or other transfer of a Healthcare Asset permitted under Section 5.02(e); and provided further that this Section 5.02(q) shall only apply to Assets other than Borrowing Base Assets where such assignment or transfer could reasonably be expected to have a Material Adverse Effect.

 

(r)                                    Healthcare Licenses.  (i)  Fail to maintain in effect all Healthcare Licenses necessary to the operation of its business or necessary for each Healthcare Asset or each Healthcare Service, or (ii) engage in any activity that (a) constitutes or, with the giving of notice, the passage of time, or both, would result in a material violation of any Healthcare License necessary for the lawful conduct of its business or operations or necessary for each Healthcare Asset or each Healthcare Service or (b) constitutes or, with the giving of notice, the passage of time, or both, would result in the loss by any Healthcare Asset or any Healthcare Service that is owned, leased, managed or operated by any Loan Party or any Subsidiary thereof of the right to participate in, and/or receive payment or reimbursement under, the appropriate Medicare, Medicaid, Tricare, Veteran’s Administration and related reimbursement programs, and any other Federal or state healthcare reimbursement programs, to the extent that any Loan Party or any Subsidiary thereof participates in and/or receives payment or reimbursement under any such program, and to receive payment or reimbursement from private and commercial payors, managed care companies, insurance companies and/or any other third-party payor arrangements, plans or programs to the extent applicable thereto, in each case under (i) and (ii), except, in each case, where the loss of such Healthcare License or rights to participate in or receive payments or reimbursement under or from such programs or payors could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.03                                 Reporting Requirements.  So long as any Advance or any other Obligation of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have any Commitment hereunder, the Borrower will furnish to the Agents and the Lender Parties in accordance with Section 9.02(b):

 

(a)                                 Default Notice.  As soon as possible and in any event within two Business Days after a Responsible Officer becomes aware of the occurrence of each Default or any event, development or occurrence reasonably expected to result in a Material Adverse Effect continuing on the date of such statement, a statement of the Chief Financial Officer (or other Responsible Officer) of the Borrower setting forth details of such Default or such event, development or occurrence and the action that the Borrower has taken and proposes to take with respect thereto.

 

(b)                                 Annual Financials.  As soon as available and in any event within 90 days after the end of each Fiscal Year, a copy of the annual audit report for such year for the Borrower and its

 

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Subsidiaries, including therein Consolidated balance sheets of the Borrower and its Subsidiaries as of the end of such Fiscal Year and Consolidated statements of income and a Consolidated statement of cash flows of the Borrower and its Subsidiaries for such Fiscal Year (it being acknowledged that a copy of the annual audit report filed by the Borrower with the Securities and Exchange Commission shall satisfy the foregoing requirements), all of which shall be (a) certified by the Chief Financial Officer or Chief Accounting Officer (or other Responsible Officer) of the Borrower, in his or her opinion, to present fairly, in accordance with GAAP and in all material respects, the financial position of the Borrower and its Subsidiaries as at the date thereof and the result of operations for such period and (b) accompanied by the report thereon of RSM US LLP or any other independent certified public accountants of recognized national standing, whose report shall be unqualified.  Together with such financial statements, the Borrower shall deliver a Compliance Certificate duly executed by the Chief Financial Officer or Chief Accounting Officer (or other Responsible Officer) of the Borrower, which Compliance Certificate shall (A) have attached a schedule in form satisfactory to the Administrative Agent of the computations used by the Borrower in determining, as of the end of such Fiscal Year, compliance with the covenants contained in Section 5.04, provided that in the event of any change in GAAP used in the preparation of such financial statements, the Borrower shall also provide, if necessary for the determination of compliance with Section 5.04, a statement of reconciliation conforming such financial statements to GAAP and (B) state that no Default has occurred and is continuing or, if a Default has occurred and is continuing, a statement as to the nature thereof and the action that the Borrower has taken and proposes to take with respect thereto.

 

(c)                                  Quarterly Financials.  As soon as available and in any event within 45 days after the end of each of the first three quarters of each Fiscal Year, Consolidated balance sheets of the Borrower and its Subsidiaries as of the end of such quarter and Consolidated statements of income and a Consolidated statement of cash flows of the Borrower and its Subsidiaries for the period commencing at the end of the previous fiscal quarter and ending with the end of such fiscal quarter and Consolidated statements of income and a Consolidated statement of cash flows of the Borrower and its Subsidiaries for the period commencing at the end of the previous Fiscal Year and ending with the end of such quarter, setting forth in each case in comparative form the corresponding figures for the corresponding date or period of the preceding Fiscal Year, all in reasonable detail and duly certified (subject to normal year-end audit adjustments) by the Chief Executive Officer, Chief Financial Officer or Treasurer (or other Responsible Officer performing similar functions) of the Borrower as having been prepared in accordance with GAAP (it being acknowledged that a copy of the quarterly financials filed by the Borrower with the Securities and Exchange Commission shall satisfy the foregoing requirements), together with a Compliance Certificate duly executed by the Chief Financial Officer (or other Responsible Officer) of the Borrower, which Compliance Certificate shall  (i) state that no Default has occurred and is continuing or, if a Default has occurred and is continuing, a statement as to the nature thereof and the action that the Borrower has taken and proposes to take with respect thereto and (ii) attach a schedule in form satisfactory to the Administrative Agent of the computations used by the Borrower in determining compliance with the covenants contained in Section 5.04, provided that in the event of any change in GAAP used in the preparation of such financial statements, the Borrower shall also provide, if necessary for the determination of compliance with Section 5.04, a statement of reconciliation conforming such financial statements to GAAP.

 

(d)                                 Borrowing Base Certificate.  As soon as available and in any event within 30 days after the end of each calendar month, a Borrowing Base Certificate, as at the end of such month, certified by the Chief Financial Officer (or other Responsible Officer performing similar functions) of the Borrower, in each case showing calculations which reflect the asset concentration limits set forth in the definition of Total Borrowing Base Value.

 

(e)                                  Borrowing Base Financials.  As soon as available and in any event within 30 days after the end of each calendar month, financial information in respect of all Borrowing Base Assets, in form and detail reasonably satisfactory to the Administrative Agent.

 

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(f)                                   Annual Budgets.  As soon as available and in any event not later than 90 days after the end of each Fiscal Year, forecasts prepared by management of the Borrower, in form reasonably satisfactory to the Administrative Agent, of balance sheets, income statements and cash flow statements on a quarterly basis for the then current Fiscal Year and on an annual basis for each Fiscal Year thereafter until the Termination Date.

 

(g)                                  Material Litigation.  Promptly after the commencement thereof, notice of all actions, suits, investigations, litigation and proceedings before any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, affecting any Loan Party or any of its Subsidiaries of the type described in Section 4.01 (f), and promptly after the occurrence thereof, notice of any adverse change in the status or the financial effect on any Loan Party or any of its Subsidiaries of the Material Litigation from that described on Schedule 4.01(f) hereto.

 

(h)                                 Securities Reports.  Promptly after the sending or filing thereof, copies of all proxy statements, financial statements and reports that any Loan Party or any of its Subsidiaries sends to the holders of its Equity Interests, and copies of all regular, periodic and special reports, and all registration statements, that any Loan Party or any of its Subsidiaries files with the Securities and Exchange Commission or any Governmental Authority that may be substituted therefor, or with any national securities exchange.

 

(i)                                     OFAC.  Promptly upon the written request of the Administrative Agent, any information that any Agent or Lender Party deems reasonably necessary from time to time in order to ensure compliance with all applicable Sanctions and Anti-Corruption Laws.

 

(j)                                    Assets Reports.  As soon as available and in any event within 45 days after the end of each quarter of each Fiscal Year, a report listing and describing (in detail reasonably satisfactory to the Administrative Agent) all Assets of the Guarantors as of the end of such quarter in form and substance reasonably satisfactory to the Administrative Agent.

 

(k)                                 Environmental Conditions.  Notice to the Administrative Agent (i) promptly upon obtaining knowledge of any material violation of any Environmental Law affecting any Asset or the operations thereof, (ii) promptly upon obtaining knowledge of any known release, discharge or disposal of any Hazardous Materials at, from, or into any Asset which it reports in writing or is legally required to report in writing to any Governmental Authority and which is material in amount or nature or which could reasonably be expected to materially adversely affect the value of such Asset, (iii) promptly upon its receipt of any written notice of material violation of any Environmental Laws or of any material release, discharge or disposal of Hazardous Materials in violation of any Environmental Laws or any matter that could reasonably be expected to result in an Environmental Action, including a notice or claim of liability or potential responsibility from any third party (including without limitation any federal, state or local governmental officials) and including notice of any formal inquiry, proceeding, demand, investigation or other action with regard to (A) such Loan Party’s or any other Person’s operation of any Asset in compliance with Environmental Laws, (B) Hazardous Materials contamination on, from or into any Asset, or (C) investigation or remediation of off-site locations at which such Loan Party or any of its predecessors are alleged to have directly or indirectly disposed of Hazardous Materials from such Asset, or (iv) upon such Loan Party’s obtaining knowledge that any expense or loss has been incurred by such Governmental Authority in connection with the assessment, containment, removal or remediation of any Hazardous Materials with respect to which such Loan Party or any Joint Venture could reasonably be expected to incur material liability or for which a Lien may be imposed on any Asset, provided that notice is required only for any of the events described in clauses (i) through (iv) above that could reasonably be expected to result in a Material Adverse Effect, could reasonably be expected to result in a material Environmental Action with respect to any Borrowing Base Asset or could reasonably be expected to result in a Lien against any Borrowing Base Asset.

 

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(l)                                     Borrowing Base Asset Value.  Promptly after obtaining actual knowledge of any setoff, claim, withholding or defense asserted or effected against any Loan Party, or to which any Borrowing Base Asset is subject, which could reasonably be expected to (i) have a material adverse effect on the value of a Borrowing Base Asset, (ii) have a Material Adverse Effect or (iii) result in the imposition or assertion of a Lien against any Borrowing Base Asset which is not a Permitted Lien, notice to the Administrative Agent thereof.

 

(m)                             Compliance with Borrowing Base Conditions.  Promptly after obtaining actual knowledge of any condition or event which causes any Borrowing Base Asset to fail to satisfy any of the Borrowing Base Conditions (other than those Borrowing Base Conditions, if any, that have theretofore been waived by the Administrative Agent and the Required Lenders with respect to any particular Borrowing Base Asset, to the extent of such waiver), notice to the Administrative Agent thereof.

 

(n)                                 Appraisals.  Promptly upon the written request of the Administrative Agent,  Appraisals of the Borrowing Base Assets that are the subject of such request; provided that so long as no Event of Default then exists, the Administrative Agent shall be entitled to request an updated Appraisal (which, for the avoidance of doubt, shall not alter the Appraised Value of such Borrowing Base Asset for purposes of the calculation of Asset Value or the financial covenants contained in Section 5.04 of this Agreement and related definitions) to the extent such Appraisal is required by any (x) regulatory authority or quasi regulatory authority or (y) applicable law or regulation.

 

(o)                                 Reconciliation Statements.  If, as a result of any change in accounting principles and policies from those used in the preparation of the audited financial statements referred to in Section 4.01(g) and forecasts referred to in Section 4.01(h), the Consolidated and consolidating financial statements and forecasts of the Borrower and its Subsidiaries delivered pursuant to Section 5.03(b), (c) or (f) will differ in any material respect from the Consolidated and consolidating financial statements that would have been delivered pursuant to such Section had no such change in accounting principles and polices been made, then (i) together with the first delivery of financial statements or forecasts pursuant to Section 5.03 (b), (c) or (f) following such change, Consolidated and consolidating financial statements and forecasts of the Borrower and its Subsidiaries for the fiscal quarter immediately preceding the fiscal quarter in which such change is made, prepared on a pro forma basis as if such change had been in effect during such fiscal quarter, and (ii) if requested by Administrative Agent, a written statement of the Chief Executive Officer, Chief Financial Officer or Treasurer (or other Responsible Officer  performing similar functions) of the Borrower setting forth the differences (including any differences that would affect any calculations relating to the financial covenants set forth in Section 5.04) which would have resulted if such financial statements and forecasts had been prepared without giving effect to such change.

 

(p)                                 Material Contract.  As soon as available, a copy of any Material Contract entered into with respect to any Borrowing Base Asset after the date hereof.

 

(q)                                 Healthcare Matters.  (i) Promptly after receipt thereof by the Borrower or any Subsidiary thereof, notice of any notices or charges relating to the non-compliance by the Borrower or any Subsidiary with any Governmental Authority, Healthcare Requirements, laws, regulations, requirements, licenses, permits, certificates, authorizations or approvals that would reasonably be expected to have a Material Adverse Effect; and (ii) promptly after receipt thereof by the Borrower or any Subsidiary thereof, copies of any and all notices (regardless of form) that any Healthcare License or Medicare or Medicaid certification or other applicable payment program participation is being, or could be, downgraded, terminated, revoked, or suspended, or that action is pending, being considered or being, or could be, taken to downgrade, terminate, revoke, or suspend any Healthcare License, or to fine, penalize or impose remedies or sanctions upon, discontinue, suspend, deny, decrease or recoup any payments due, made or coming due, or that action is pending, being considered, or being, or could be, taken, to fine, penalize or impose remedies or sanctions upon, discontinue, suspend, deny, decrease

 

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or recoup any payments due, made or coming due any of which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect; provided, however, that the Administrative Agent shall be promptly notified by the Borrower of an inquiry or an investigation, in each case of a non-routine nature, or audit by a State Medicaid Fraud Control Unit, a State Attorney General, the United States Department of Justice or the OIG, affecting any Borrowing Base Asset.  The Borrower shall promptly provide supporting documentation or additional information regarding any of the foregoing reasonably requested by the Administrative Agent, other than documents subject to attorney-client privilege.

 

(r)                                    Other Information.  Promptly, such other information respecting the business, condition (financial or otherwise), operations, performance, properties or prospects of any Loan Party or any of its Subsidiaries as the Administrative Agent, or any Lender Party through the Administrative Agent, may from time to time reasonably request.

 

Information required to be delivered pursuant to Section 5.03(b) or Section 5.03(c) shall be deemed to have been delivered on the date on which the Borrower provides notice to the Administrative Agent that such information has been posted on the Borrower’s website on the Internet at http://www.fivestarseniorliving.com or at another website identified in such notice and accessible by the Lender Parties without charge; provided that the Borrower shall deliver paper copies of the information referred to in such Sections to the Administrative Agent for distribution to (x) any Lender Party to which the above referenced websites are for any reason not available if such Lender Party or the Administrative Agent has so notified the Borrower and (y) any Lender Party that has notified the Borrower that it desires paper copies of all such information; and provided further that the Administrative Agent shall notify the Lender Parties in accordance with Section 9.02 of any materials delivered pursuant to this Section 5.03.

 

SECTION 5.04                                 Financial Covenants.  So long as any Advance or any other Obligation of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be outstanding or any Lender Party shall have, at any time after the Initial Extension of Credit, any Commitment hereunder, the Borrower will:

 

(a)                                 Borrower Financial Covenants.

 

(i)                                     Maximum Leverage Ratio.  Maintain at all times a Leverage Ratio of not greater than 5.00:1.00.

 

(ii)                                  Minimum Tangible Net Worth.  Maintain at all times tangible net worth of the Borrower and its Subsidiaries, as determined in accordance with GAAP (but exclusive of depreciation and amortization), of not less than the sum of $248,595,750.00 plus an amount equal to 75% times the net cash proceeds of all issuances and primary sales of Equity Interests of the Borrower or any of its Subsidiaries consummated after December 31, 2016.

 

(iii)                               Minimum Fixed Charge Coverage Ratio.  Maintain at all times a Fixed Charge Coverage Ratio of not less than 1.50:1.00.

 

(b)                                 Borrowing Base Financial Covenants.

 

(i)                                     Maximum Facility Exposure.  Not permit at any time the Facility Exposure at such time to exceed the Facility Available Amount at such time.

 

(ii)                                  Minimum Borrowing Base Debt Service Coverage Ratio.  Maintain at all times a Borrowing Base Debt Service Coverage Ratio of not less than 1.50:1.00.

 

To the extent any calculations described in Sections 5.04(a) or 5.04(b) are required to be made on any date of determination other than the last day of a fiscal quarter of the Borrower, such calculations shall be made on a pro forma basis to account for any acquisitions or dispositions of Assets, and the incurrence

 

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or repayment of any Debt for Borrowed Money relating to such Assets, that have occurred since the last day of the fiscal quarter of the Borrower most recently ended.  To the extent any calculations described in Sections 5.04(a) or 5.04(b) are required to be made on a Test Date relating to an Advance, a merger permitted under Section 5.02(d), a Transfer permitted under Section 5.02(e)(iii) or new Material Debt, such calculations shall be made both before and on a pro forma basis after giving effect to such Advance, merger, Transfer or such other event, as applicable.  All calculations under this Section 5.04 shall be made on a pro forma basis to account for any applicable monthly or 30-day financial statements or reports required to be delivered pursuant to Section 5.03 since the date of the most recently delivered quarterly statements or reports.  All such calculations shall be reasonably acceptable to the Administrative Agent.

 

ARTICLE VI
 EVENTS OF DEFAULT

 

SECTION 6.01                                 Events of Default.  If any of the following events (“Events of Default”) shall occur and be continuing:

 

(a)                                 Failure to Make Payments When Due.  (i) The Borrower shall fail to pay any principal of any Advance when the same shall become due and payable or (ii) the Borrower shall fail to pay any interest on any Advance, or any Loan Party shall fail to make any other payment under any Loan Document, in each case under this clause (ii) within three Business Days after the same becomes due and payable; or

 

(b)                                 Breach of Representations and Warranties.  Any representation or warranty made by any Loan Party (or any of its officers or the officers of its general partner or managing member, as applicable) under or in connection with any Loan Document shall prove to have been incorrect in any material respect when made; or

 

(c)                                  Breach of Certain Covenants.  The Borrower shall fail to perform or observe any term, covenant or agreement contained in Section 2.14, 5.01(d), (e), (f), (i), (j), (n), (o), (p) or (t), 5.02, 5.03(a), (d), (e), (f), (g), (h), (j), (k), (l), (m), (n), (o), (p), (q) and  (r) (provided that in the case of Section 5.03(g), (h), (k), (l), (m), (o), (p) and (q) only, if such failure shall remain unremedied for three Business Days after the earlier of the date on which (i) a Responsible Officer becomes aware of such failure or (ii) written notice thereof shall have been given to the Borrower by any Agent or any Lender Party) or 5.04; or

 

(d)                                 Other Defaults under Loan Documents.  Any Loan Party shall fail to perform or observe any other term, covenant or agreement contained in any Loan Document on its part to be performed or observed if such failure shall remain unremedied for 30 days after the earlier of the date on which (i) a Responsible Officer becomes aware of such failure or (ii) written notice thereof shall have been given to the Borrower by any Agent or any Lender Party; or

 

(e)                                  Cross Defaults.  (i) Any Loan Party or any Subsidiary thereof shall fail to pay any principal of, premium or interest on or any other amount payable in respect of any Material Debt when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise); or (ii) any other event shall occur or condition shall exist under any agreement or instrument relating to any Material Debt, if (A) the effect of such event or condition is to permit the acceleration of the maturity of such Material Debt or otherwise permit the holders thereof to cause such Material Debt to mature, and (B) such event or condition shall remain unremedied or otherwise uncured for a period of 30 days; or (iii) the maturity of any such Material Debt shall be accelerated or any such Material Debt shall be declared to be due and payable or required to be prepaid or redeemed (other than by a regularly scheduled required prepayment or redemption), purchased or defeased, or an offer to prepay, redeem, purchase or defease such Material Debt shall be required to be made, in each case prior to the stated maturity thereof; or

 

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(f)                                   Insolvency Events.  Any Loan Party shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against any Loan Party seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver, trustee, or other similar official for it or for any substantial part of its property and, in the case of any such proceeding instituted against it (but not instituted by it) that is being diligently contested by it in good faith, either such proceeding shall remain undismissed or unstayed for a period of 60 days or any of the actions sought in such proceeding (including, without limitation, the entry of an order for relief against, or the appointment of a receiver, trustee, custodian or other similar official for, it or any substantial part of its property) shall occur; or any Loan Party shall take any corporate action to authorize any of the actions set forth above in this subsection (f); or

 

(g)                                  Monetary Judgments.  Any judgments or orders, either individually or in the aggregate, for the payment of money in excess of $10,000,000 shall be rendered against any Loan Party or any Subsidiary thereof and either (i) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (ii) there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; provided, however, that any such judgment or order shall not give rise to an Event of Default under this Section 6.01(g) if and so long as (A) the amount of such judgment or order which remains unsatisfied is covered by a valid and binding policy of insurance between the respective Loan Party or Subsidiary and the insurer covering full payment of such unsatisfied amount and (B) such insurer, which shall be rated at least “A” by A.M. Best Company, has been notified, and has not disputed the claim made for payment, of the amount of such judgment or order; or

 

(h)                                 Non-Monetary Judgments.  Any non-monetary judgment or order shall be rendered against any Loan Party or Subsidiary thereof that could reasonably be expected to result in a Material Adverse Effect, and there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or

 

(i)                                     Unenforceability of Loan Documents.  Any material provision of any Loan Document after delivery thereof pursuant to Section 3.01 or 5.01(j) shall for any reason (other than pursuant to the terms thereof) cease to be valid and binding on or enforceable against any Loan Party which is party to it, or any such Loan Party shall so state in writing; or

 

(j)                                    Security Failure.  Any Collateral Document or financing statement after delivery thereof pursuant to Section 3.01 or 5.01(j) shall for any reason (other than pursuant to the terms thereof) cease to create a valid and perfected first priority lien on and security interest in the Collateral purported to be covered thereby; or

 

(k)                                 Change of Control.  A Change of Control shall occur; or

 

(l)                                     ERISA Events.  Any ERISA Event shall have occurred with respect to a Plan and the sum (determined as of the date of occurrence of such ERISA Event) of the Insufficiency of such Plan and the Insufficiency of any and all other Plans with respect to which an ERISA Event shall have occurred and then exist (or the liability of the Loan Parties and the ERISA Affiliates related to such ERISA Event) exceeds $5,000,000,

 

then, and in any such event, the Administrative Agent (i) shall at the request, or may with the consent, of the Required Lenders, by notice to the Borrower, declare the Commitments of each Lender Party and the obligation of each Lender Party to make Advances (other than Letter of Credit Advances by an Issuing Bank

 

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or a Lender pursuant to Section 2.03(c) and Swing Line Advances by a Lender pursuant to Section 2.02(b)) and of each Issuing Bank to issue Letters of Credit to be terminated, whereupon the same shall forthwith terminate, and (ii) shall at the request, or may with the consent, of the Required Lenders, (A) by notice to the Borrower, declare the Advances, all interest thereon and all other amounts payable under this Agreement and the other Loan Documents to be forthwith due and payable, whereupon the Advances, all such interest and all such amounts shall become and be forthwith due and payable, without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by the Borrower, and (B) by notice to each party required under the terms of any agreement in support of which a Letter of Credit is issued, request that all Obligations under such agreement be declared to be due and payable; provided, however, that in the event of an actual or deemed entry of an order for relief with respect to the Borrower under any Bankruptcy Law, (y) the Commitments of each Lender Party and the obligation of each Lender Party to make Advances (other than Letter of Credit Advances by an Issuing Bank or a Lender pursuant to Section 2.03(c) and Swing Line Advances by a Lender pursuant to Section 2.02(b)) and of each Issuing Bank to issue Letters of Credit shall automatically be terminated and (z) the Advances, all such interest and all such amounts shall automatically become and be due and payable, without presentment, demand, protest or any notice of any kind, all of which are hereby expressly waived by the Borrower.

 

SECTION 6.02                                 Actions in Respect of the Letters of Credit upon Default.  If any Event of Default shall have occurred and be continuing, the Administrative Agent may, or shall at the request of the Required Lenders, irrespective of whether it is taking any of the actions described in Section 6.01 or 2.17(e) or otherwise, make demand upon the Borrower to, and forthwith upon such demand the Borrower will, pay to the Administrative Agent on behalf of the Lender Parties in same day funds at the Administrative Agent’s office designated in such demand, for deposit in the L/C Cash Collateral Account, an amount equal to the aggregate Available Amount of all Letters of Credit then outstanding.  If at any time the Administrative Agent or the Issuing Bank determines that any funds held in the L/C Cash Collateral Account are subject to any right or claim of any Person other than the Agents and the Lender Parties with respect to the Obligations of the Loan Parties under the Loan Documents, or that the total amount of such funds is less than the aggregate Available Amount of all Letters of Credit, the Borrower will, forthwith upon demand by the Administrative Agent, pay to the Administrative Agent, as additional funds to be deposited and held in the L/C Cash Collateral Account, an amount equal to the excess of (a) such aggregate Available Amount over (b) the total amount of funds, if any, then held in the L/C Cash Collateral Account that the Administrative Agent, as the case may be, determines to be free and clear of any such right and claim.  Upon the drawing of any Letter of Credit for which funds are on deposit in the L/C Cash Collateral Account, such funds shall be applied to reimburse the relevant Issuing Bank or Lenders, as applicable, to the extent permitted by applicable law.

 

ARTICLE VII
 GUARANTY

 

SECTION 7.01                                 Guaranty; Limitation of Liability.  (a)  Each Guarantor hereby absolutely, unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all Obligations of each other Loan Party now or hereafter existing under or in respect of the Loan Documents (including, without limitation, any extensions, modifications, substitutions, amendments or renewals of any or all of the foregoing Obligations, but in each case excluding all Excluded Swap Obligations), whether direct or indirect, absolute or contingent, and whether for principal, interest, premiums, fees, indemnities, contract causes of action, costs, expenses or otherwise (such Obligations being the “Guaranteed Obligations”), and agrees to pay any and all expenses (including, without limitation, fees and expenses of counsel) incurred by the Administrative Agent or any other Secured Party in enforcing any rights under this Agreement or any other Loan Document.  Without limiting the generality of the foregoing, each Guarantor’s liability shall extend to all amounts that constitute part of the Guaranteed Obligations and would be owed by any other Loan Party to any Secured Party under or in respect of the Loan Documents but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving such other Loan Party.  This Guaranty is and constitutes a guaranty of payment and not merely of collection.  Each Guarantor that was a “Guarantor” (as defined in the Existing Credit Agreement) confirms that it has not been released from the

 

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“Guaranteed Obligations” (as defined in the Existing Credit Agreement) and that nothing in this Article VII shall be construed as a discharge, extinguishment or novation of the Guaranteed Obligations of such Guarantor outstanding under the Existing Agreement.

 

(b)                                 Each Guarantor, the Administrative Agent and each other Lender Party and, by its acceptance of the benefits of this Guaranty, each other Secured Party, hereby confirms that it is the intention of all such Persons that this Guaranty and the Obligations of each Guarantor hereunder not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to the extent applicable to this Guaranty and the Obligations of each Guarantor hereunder.  To effectuate the foregoing intention, the Guarantors, the Administrative Agent, the other Lender Parties and, by their acceptance of the benefits of this Guaranty, the other Secured Parties hereby irrevocably agree that the Obligations of each Guarantor under this Guaranty at any time shall be limited to the maximum amount as will result in the Obligations of such Guarantor under this Guaranty not constituting a fraudulent transfer or conveyance.

 

(c)                                  Each Guarantor hereby unconditionally and irrevocably agrees that in the event any payment shall be required to be made to any Secured Party under this Guaranty or any other guaranty, such Guarantor will contribute, to the maximum extent permitted by law, such amounts to each other Guarantor and each other guarantor so as to maximize the aggregate amount paid to the Secured Parties under or in respect of the Loan Documents.

 

SECTION 7.02                                 Guaranty Absolute.  Each Guarantor guarantees that the Guaranteed Obligations will be paid strictly in accordance with the terms of this Agreement and the other Loan Documents, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Administrative Agent or any other Secured Party with respect thereto.  The Obligations of each Guarantor under or in respect of this Guaranty are independent of the Guaranteed Obligations or any other Obligations of any other Loan Party under or in respect of this Agreement or the other Loan Documents, and a separate action or actions may be brought and prosecuted against each Guarantor to enforce this Guaranty, irrespective of whether any action is brought against the Borrower or any other Loan Party or whether the Borrower or any other Loan Party is joined in any such action or actions.  The liability of each Guarantor under this Guaranty shall be irrevocable, absolute and unconditional irrespective of, and each Guarantor hereby irrevocably waives any defenses it may now have or hereafter acquire in any way relating to, any or all of the following:

 

(a)                                 any lack of validity or enforceability of any Loan Document or any agreement or instrument relating thereto;

 

(b)                                 any change in the time, manner or place of payment of, or in any other term of, all or any of the Guaranteed Obligations or any other Obligations of any other Loan Party under or in respect of the Loan Documents, or any other amendment or waiver of or any consent to departure from any Loan Document, including, without limitation, any increase in the Guaranteed Obligations resulting from the extension of additional credit to the Borrower, any other Loan Party or any of their Subsidiaries or otherwise;

 

(c)                                  any taking, exchange, release or non-perfection of any collateral, or any taking, release or amendment or waiver of, or consent to departure from, any other guaranty, for all or any of the Guaranteed Obligations;

 

(d)                                 any manner of application of collateral, or proceeds thereof, to all or any of the Guaranteed Obligations, or any manner of sale or other disposition of any collateral for all or any of the Guaranteed Obligations or any other Obligations of any Loan Party under the Loan Documents or any other assets of any Loan Party or any of its Subsidiaries;

 

(e)                                  any change, restructuring or termination of the corporate structure or existence of any Loan Party or any of its Subsidiaries;

 

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(f)                                   any failure of the Administrative Agent or any other Secured Party to disclose to any Loan Party any information relating to the business, condition (financial or otherwise), operations, performance, properties or prospects of any other Loan Party now or hereafter known to the Administrative Agent or such other Secured Party (each Guarantor waiving any duty on the part of the Administrative Agent and each other Secured Party to disclose such information);

 

(g)                                  the failure of any other Person to execute or deliver this Agreement, any other Loan Document, any Guaranty Supplement or any other guaranty or agreement or the release or reduction of liability of any Guarantor or other guarantor or surety with respect to the Guaranteed Obligations; or

 

(h)                                 any other circumstance (including, without limitation, any statute of limitations) or any existence of or reliance on any representation by the Administrative Agent or any other Secured Party that might otherwise constitute a defense available to, or a discharge of, any Loan Party or any other guarantor or surety.

 

This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Guaranteed Obligations is rescinded or must otherwise be returned by any Secured Party or any other Person upon the insolvency, bankruptcy or reorganization of the Borrower or any other Loan Party or otherwise, all as though such payment had not been made.

 

SECTION 7.03                                 Waivers and Acknowledgments.  (a)  Each Guarantor hereby unconditionally and irrevocably waives promptness, diligence, notice of acceptance, presentment, demand for performance, notice of nonperformance, default, acceleration, protest or dishonor and any other notice with respect to any of the Guaranteed Obligations and this Guaranty and any requirement that the Administrative Agent or any other Secured Party protect, secure, perfect or insure any Lien or any property subject thereto or exhaust any right or take any action against any Loan Party or any other Person or any collateral.

 

(b)                                 Each Guarantor hereby unconditionally and irrevocably waives any right to revoke this Guaranty and acknowledges that this Guaranty is continuing in nature and applies to all Guaranteed Obligations, whether existing now or in the future.

 

(c)                                  Each Guarantor hereby unconditionally and irrevocably waives (i) any defense arising by reason of any claim or defense based upon an election of remedies by the Administrative Agent or any other Secured Party that in any manner impairs, reduces, releases or otherwise adversely affects the subrogation, reimbursement, exoneration, contribution or indemnification rights of such Guarantor or other rights of such Guarantor to proceed against any of the other Loan Parties, any other guarantor or any other Person or any collateral and (ii) any defense based on any right of set-off or counterclaim against or in respect of the Obligations of such Guarantor hereunder.

 

(d)                                 Each Guarantor acknowledges that the Administrative Agent may, without notice to or demand upon such Guarantor and without affecting the liability of such Guarantor under this Guaranty, foreclose under any mortgage by nonjudicial sale, and each Guarantor hereby waives any defense to the recovery by the Administrative Agent and the other Secured Parties against such Guarantor of any deficiency after such nonjudicial sale and any defense or benefits that may be afforded by applicable law.

 

(e)                                  Each Guarantor hereby unconditionally and irrevocably waives any duty on the part of the Administrative Agent or any other Secured Party to disclose to such Guarantor any matter, fact or thing relating to the business, condition (financial or otherwise), operations, performance, properties or prospects of the Borrower, any other Loan Party or any of their Subsidiaries now or hereafter known by the Administrative Agent or such other Secured Party.

 

(f)                                   Each Guarantor acknowledges that it will receive substantial direct and indirect benefits from the financing arrangements contemplated by this Agreement and the other Loan Documents and

 

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that the waivers set forth in Section 7.02 and this Section 7.03 are knowingly made in contemplation of such benefits.

 

SECTION 7.04                                 Subrogation.  Each Guarantor hereby unconditionally and irrevocably agrees not to exercise any rights that it may now have or hereafter acquire against the Borrower, any other Loan Party or any other insider guarantor that arise from the existence, payment, performance or enforcement of such Guarantor’s Obligations under or in respect of this Guaranty, this Agreement or any other Loan Document, including, without limitation, any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of any Secured Party against the Borrower, any other Loan Party or any other insider guarantor or any collateral, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including, without limitation, the right to take or receive from the Borrower, any other Loan Party or any other insider guarantor, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right, unless and until all of the Guaranteed Obligations and all other amounts payable under this Guaranty shall have been indefeasibly paid in full in cash, all Letters of Credit shall have expired or been terminated and the Commitments shall have expired or been terminated.  If any amount shall be paid to any Guarantor in violation of the immediately preceding sentence at any time prior to the latest of (a) the indefeasible payment in full in cash of the Guaranteed Obligations and all other amounts payable under this Guaranty, (b) the termination in whole of the Commitments and (c) the latest date of expiration or termination of all Letters of Credit, such amount shall be received and held in trust for the benefit of the Secured Parties, shall be segregated from other property and funds of such Guarantor and shall forthwith be paid or delivered to the Administrative Agent in the same form as so received (with any necessary endorsement or assignment) to be credited and applied to the Guaranteed Obligations and all other amounts payable under this Guaranty, whether matured or unmatured, in accordance with the terms of the Loan Documents.  If (i) any Guarantor shall make payment to any Secured Party of all or any part of the Guaranteed Obligations, (ii) all of the Guaranteed Obligations and all other amounts payable under this Guaranty shall have been indefeasibly paid in full in cash, (iii) the termination in whole of the Commitments shall have occurred and (iv) all Letters of Credit shall have expired or been terminated, the Administrative Agent and the other Secured Parties will, at such Guarantor’s request and expense, execute and deliver to such Guarantor appropriate documents, without recourse and without representation or warranty, necessary to evidence the transfer by subrogation to such Guarantor of an interest in the Guaranteed Obligations resulting from such payment made by such Guarantor pursuant to this Guaranty.

 

SECTION 7.05                                 Guaranty Supplements.  Upon the execution and delivery by any Person of a Guaranty Supplement, (i) such Person shall be referred to as an “Additional Guarantor” and shall become and be a Guarantor hereunder, and each reference in this Agreement to a “Guarantor” or a “Loan Party” shall also mean and be a reference to such Additional Guarantor, and each reference in any other Loan Document to a “Guarantor” shall also mean and be a reference to such Additional Guarantor, and (ii) each reference herein to “this Agreement”, “this Guaranty”, “hereunder”, “hereof” or words of like import referring to this Agreement and this Guaranty, and each reference in any other Loan Document to the “Loan Agreement”, “Guaranty”, “thereunder”, “thereof” or words of like import referring to this Agreement and this Guaranty, shall mean and be a reference to this Agreement and this Guaranty as supplemented by such Guaranty Supplement.

 

SECTION 7.06                                 Indemnification by Guarantors.  (a)  Without limitation on any other Obligations of any Guarantor or remedies of the Administrative Agent or the Secured Parties under this Agreement, this Guaranty or the other Loan Documents, each Guarantor shall, to the fullest extent permitted by law, indemnify, defend and save and hold harmless the Administrative Agent, the Arrangers, each other Secured Party and each of their Affiliates and their respective officers, directors, employees, agents and advisors (each, an “Indemnified Party”) from and against, and shall pay on demand, any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and expenses of counsel) that may be incurred by or asserted or awarded against any Indemnified Party in connection with or as a result of any failure of any Guaranteed Obligations to be the legal, valid and binding obligations of any Loan Party enforceable against such Loan Party in accordance with their terms.

 

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(b)                                 Each Guarantor hereby also agrees that no Indemnified Party shall have any liability (whether direct or indirect, in contract, tort or otherwise) to any of the Guarantors or any of their respective Affiliates or any of their respective officers, directors, employees, agents and advisors, and each Guarantor hereby agrees not to assert any claim against any Indemnified Party on any theory of liability, for special, incidental, indirect, consequential or punitive damages arising out of or otherwise relating to the Facilities, the actual or proposed use of the proceeds of the Advances or the Letters of Credit, the Loan Documents or any of the transactions contemplated by the Loan Documents.

 

SECTION 7.07                                 Subordination.  Each Guarantor hereby subordinates any and all debts, liabilities and other Obligations owed to such Guarantor by each other Loan Party (the “Subordinated Obligations”) to the Guaranteed Obligations to the extent and in the manner hereinafter set forth in this Section 7.07.

 

(a)                                 Prohibited Payments, Etc.  Except during the continuance of an Event of Default (including the commencement and continuation of any proceeding under any Bankruptcy Law relating to any other Loan Party), each Guarantor may receive regularly scheduled payments or payments made in the ordinary course of business from any other Loan Party on account of the Subordinated Obligations.  After the occurrence and during the continuance of any Event of Default (including the commencement and continuation of any proceeding under any Bankruptcy Law relating to any other Loan Party), however, unless the Administrative Agent otherwise agrees, no Guarantor shall demand, accept or take any action to collect any payment on account of the Subordinated Obligations.

 

(b)                                 Prior Payment of Guaranteed Obligations.  In any proceeding under any Bankruptcy Law relating to any other Loan Party, each Guarantor agrees that the Secured Parties shall be entitled to receive payment in full in cash of all Guaranteed Obligations (including all interest and expenses accruing after the commencement of a proceeding under any Bankruptcy Law, whether or not constituting an allowed claim in such proceeding (“Post Petition Interest”)) before such Guarantor receives payment of any Subordinated Obligations.

 

(c)                                  Turn-Over.  After the occurrence and during the continuance of any Event of Default (including the commencement and continuation of any proceeding under any Bankruptcy Law relating to any other Loan Party), each Guarantor shall, if the Administrative Agent so requests, collect, enforce and receive payments on account of the Subordinated Obligations as trustee for the Secured Parties and deliver such payments to the Administrative Agent on account of the Guaranteed Obligations (including all Post Petition Interest), together with any necessary endorsements or other instruments of transfer, but without reducing or affecting in any manner the liability of such Guarantor under the other provisions of this Guaranty.

 

(d)                                 Administrative Agent Authorization.  After the occurrence and during the continuance of any Event of Default (including the commencement and continuation of any proceeding under any Bankruptcy Law relating to any other Loan Party), the Administrative Agent is authorized and empowered (but without any obligation to so do), in its discretion, (i) in the name of each Guarantor, to collect and enforce, and to submit claims in respect of, Subordinated Obligations and to apply any amounts received thereon to the Guaranteed Obligations (including any and all Post Petition Interest), and (ii) to require each Guarantor (A) to collect and enforce, and to submit claims in respect of, Subordinated Obligations and (B) to pay any amounts received on such obligations to the Administrative Agent for application to the Guaranteed Obligations (including any and all Post Petition Interest).

 

SECTION 7.08                                 Continuing Guaranty.  This Guaranty is a continuing guaranty and shall (a) remain in full force and effect until the latest of (i) the indefeasible payment in full in cash of the Guaranteed Obligations and all other amounts payable under this Guaranty, (ii) the termination in whole of the Commitments and (iii) the latest date of expiration or termination of all Letters of Credit, (b) be binding upon the Guarantors, their successors and assigns and (c) inure to the benefit of and be enforceable by the Administrative Agent and the other Secured Parties and their successors, transferees and assigns.

 

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SECTION 7.09                                 Keepwell.  Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of its Guaranteed Obligations in respect of Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 7.09 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 7.09, or otherwise in respect of the Guaranteed Obligations, as it relates to such other Loan Party, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount).  The obligations of each Qualified ECP Guarantor under this Section shall remain in full force and effect until a discharge of the Guaranteed Obligations.  Each Qualified ECP Guarantor intends that this Section 7.09 constitute, and this Section 7.09 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a (18)(A)(v)(II) of the Commodity Exchange Act.

 

ARTICLE VIII
 THE AGENTS

 

SECTION 8.01                                 Authorization and Action; Appointment of Supplemental Collateral Agents.  (a)  Each Lender Party (in its capacities as a Lender, the Swing Line Bank (if applicable) and as an Issuing Bank (if applicable)) hereby appoints and authorizes each Agent to take such action as agent on its behalf and to exercise such powers and discretion under this Agreement and the other Loan Documents as are delegated to such Agent by the terms hereof and thereof, together with such powers and discretion as are reasonably incidental thereto.  As to any matters not expressly provided for by the Loan Documents (including, without limitation, enforcement or collection of the Notes), no Agent shall be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Required Lenders, and such instructions shall be binding upon all Lender Parties and all holders of Notes; provided, however, that no Agent shall be required to take any action that exposes such Agent to personal liability or that is contrary to this Agreement or applicable law.  Each Agent agrees to give to each Lender Party prompt notice of each notice given to it by the Borrower pursuant to the terms of this Agreement.  Notwithstanding anything to the contrary in any Loan Document, no Person identified as a syndication agent, joint lead arranger or joint book running manager, in such Person’s capacity as such, shall have any obligations or duties to any Loan Party, the Administrative Agent or any other Secured Party under any of such Loan Documents.  In its capacity as the Lender Parties’ contractual representative, Agents are each a “representative” of the Lender Parties as used within the meaning of “Secured Party” under Section 9-102 of the Uniform Commercial Code.

 

(b)                                 Anything contained herein or in the Collateral Documents to the contrary notwithstanding, the Collateral Agent may from time to time, when the Collateral Agent deems it to be necessary, appoint one or more trustees, co-trustees, collateral co-agents or collateral subagents (each, a “Supplemental Collateral Agent”) with respect to all or any part of the Collateral.  In the event that the Collateral Agent so appoints any Supplemental Collateral Agent with respect to any Collateral, (i) such Supplemental Collateral Agent shall automatically be vested, in addition to the Collateral Agent, with all rights, powers, privileges, interests and remedies of the Collateral Agent under the Collateral Documents with respect to such Collateral; (ii) such Supplemental Collateral Agent shall be deemed to be an “Agent” for purposes of this Agreement and the other Loan Documents, and the provisions of the Security Agreement, this Article and Section 9.04 hereof that refer to the Agents (or either of them) shall inure to the benefit of such Supplemental Collateral Agent, and all references therein and in the other Loan Documents to the Collateral Agent shall be deemed to be references to the Collateral Agent and/or such Supplemental Collateral Agent, as the context may require; and (iii) the term “Collateral Agent”, when used herein or in any applicable Collateral Document in relation to the Liens on or security interests in such Collateral granted in favor of the Collateral Agent, and any rights, powers, privileges, interests and remedies of the Collateral Agent with respect to such Collateral, shall be deemed to include such Supplemental Collateral Agent; provided, however, that no such Supplemental Collateral Agent shall be authorized to take any action with respect to any such Collateral unless and except to the extent expressly authorized in writing by the Collateral Agent.  Should any instrument in writing from the Borrower or any other Loan Party be required by any Supplemental Collateral Agent so

 

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appointed by the Collateral Agent to more fully or certainly vest in and confirming to such Supplemental Collateral Agent such rights, powers, privileges and duties, the Borrower shall, or shall cause such Loan Party to, execute, acknowledge and deliver any and all such instruments promptly upon request by the Collateral Agent.  If any Supplemental Collateral Agent, or successor thereto, shall die, become incapable of acting, resign or be removed, all the rights, powers, privileges and duties of such Supplemental Collateral Agent, to the extent permitted by law, shall automatically vest in and be exercised by the Collateral Agent until the appointment of a new Supplemental Collateral Agent.

 

SECTION 8.02                                 Agents’ Reliance, Etc.  Neither any Agent nor any of its directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it or them under or in connection with the Loan Documents, except for its or their own gross negligence or willful misconduct.  Without limitation of the generality of the foregoing, each Agent:  (a) in the case of the Administrative Agent, may treat the payee of any Note as the holder thereof until the Administrative Agent receives and accepts an Accession Agreement entered into by an Acceding Lender as provided in Section 2.19 or an Assignment and Acceptance entered into by the Lender that is the payee of such Note, as assignor, and an Eligible Assignee, as assignee, or, in the case of any other Agent, such Agent has received notice from the Administrative Agent that it has received and accepted such Assignment and Acceptance as provided in Section 9.07; (b) may consult with legal counsel (including counsel for any Loan Party), independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (c) makes no warranty or representation to any Lender Party and shall not be responsible to any Lender Party for any statements, warranties or representations (whether written or oral) made in or in connection with the Loan Documents; (d) shall not have any duty to ascertain or to inquire as to the performance, observance or satisfaction of any of the terms, covenants or conditions of any Loan Document on the part of any Loan Party or the existence at any time of any Default under the Loan Documents or to inspect the property (including the books and records) of any Loan Party; (e) shall not be responsible to any Lender Party for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of, or the perfection or priority of any lien or security interest created or purported to be created under or in connection with, any Loan Document or any other instrument or document furnished pursuant thereto; (f) shall incur no liability under or in respect of any Loan Document by acting upon any notice, consent, certificate or other instrument or writing (which may be by telegram, telecopy or telex or other electronic communication) believed by it to be genuine and signed or sent by the proper party or parties; and (g) shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or Applicable Law, including for the avoidance of doubt, any action that may be in violation of the automatic stay under any Bankruptcy Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Bankruptcy Law.

 

SECTION 8.03                                 Citibank and Affiliates.  With respect to its Commitments, the Advances made by it and the Notes issued to it, Citibank shall have the same rights and powers under the Loan Documents as any other Lender Party and may exercise the same as though it were not an Agent; and the term “Lender Party” or “Lender Parties” shall, unless otherwise expressly indicated, include Citibank in its individual capacity.  Citibank and its Affiliates may accept deposits from, lend money to, act as trustee under indentures of, accept investment banking engagements from and generally engage in any kind of business with, any Loan Party, any Subsidiary of any Loan Party and any Person that may do business with or own securities of any Loan Party or any such Subsidiary, all as if Citibank were not the Administrative Agent or the Collateral Agent and without any duty to account therefor to the Lender Parties.

 

SECTION 8.04                                 Lender Party Credit Decision.  Each Lender Party acknowledges that it has, independently and without reliance upon any Agent or any other Lender Party and based on the financial statements referred to in Section 4.01 and such other documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Lender Party also acknowledges that it will, independently and without reliance upon any Agent or any other Lender Party and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement.  Nothing in this Agreement or any other Loan Document

 

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shall require any Agent or any of its respective directors, officers, agents or employees to carry out any “know your customer” or other checks in relation to any Person on behalf of any Lender Party and each Lender Party confirms to the Agents that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by any Agent or any of its respective directors, officers, agents or employees.

 

SECTION 8.05                                 Indemnification by Lender Parties.  (a)  Each Lender Party severally agrees to indemnify each Agent (to the extent not promptly reimbursed by the Borrower) from and against such Lender Party’s ratable share (determined as provided below) of any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever that may be imposed on, incurred by, or asserted against such Agent in any way relating to or arising out of the Loan Documents or any action taken or omitted by such Agent under the Loan Documents (collectively, the “Indemnified Costs”); provided, however, that no Lender Party shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from any Agent’s gross negligence or willful misconduct as found in a final, non-appealable judgment by a court of competent jurisdiction.  Without limitation of the foregoing, each Lender Party severally agrees to reimburse each Agent promptly upon demand for its ratable share of any costs and expenses (including, without limitation, fees and expenses of counsel) payable by the Borrower under Section 9.04, to the extent that such Agent is not promptly reimbursed for such costs and expenses by the Borrower.  In the case of any investigation, litigation or proceeding giving rise to any Indemnified Costs, this Section 8.05 applies whether any such investigation, litigation or proceeding is brought by any Lender Party or any other Person.

 

(b)                                 Each Lender Party severally agrees to indemnify each Issuing Bank (to the extent not promptly reimbursed by the Borrower) from and against such Lender Party’s ratable share (determined as provided below) of any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever that may be imposed on, incurred by, or asserted against such Issuing Bank in any way relating to or arising out of the Loan Documents or any action taken or omitted by such Issuing Bank under the Loan Documents; provided, however, that no Lender Party shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from such Issuing Bank’s gross negligence or willful misconduct as found in a final, non-appealable judgment by a court of competent jurisdiction.  Without limitation of the foregoing, each Lender Party severally agrees to reimburse such Issuing Bank promptly upon demand for its ratable share of any costs and expenses (including, without limitation, fees and expenses of counsel) payable by the Borrower under Section 9.04, to the extent that such Issuing Bank is not promptly reimbursed for such costs and expenses by the Borrower.

 

(c)                                  For purposes of this Section 8.05, the Lender Parties’ respective ratable shares of any amount shall be determined, at any time, according to their respective Revolving Credit Commitments at such time.  The failure of any Lender Party to reimburse any Agent or any Issuing Bank, as the case may be, promptly upon demand for its ratable share of any amount required to be paid by the Lender Parties to such Agent or such Issuing Bank, as the case may be, as provided herein shall not relieve any other Lender Party of its obligation hereunder to reimburse such Agent or such Issuing Bank, as the case may be, for its ratable share of such amount, but no Lender Party shall be responsible for the failure of any other Lender Party to reimburse such Agent or  such Issuing Bank, as the case may be, for such other Lender Party’s ratable share of such amount.  Without prejudice to the survival of any other agreement of any Lender Party hereunder, the agreement and obligations of each Lender Party contained in this Section 8.05 shall survive the payment in full of principal, interest and all other amounts payable hereunder and under the other Loan Documents.

 

SECTION 8.06                                 Successor Agents.  (a)  Any Agent may resign at any time by giving 30 days’ prior written notice thereof to the Lender Parties and the Borrower and may be removed at any time with or without cause by the Required Lenders; provided, however, that any removal of the Administrative Agent will not be effective until it has been replaced as Collateral Agent and it (or its Affiliate) has been replaced as an Issuing Bank and released from all obligations in respect thereof.  Upon any such resignation or

 

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removal, the Required Lenders shall have the right to appoint a successor Agent.  If no successor Agent shall have been so appointed by the Required Lenders, and shall have accepted such appointment, within 30 days after the retiring Agent’s giving of notice of resignation or the Required Lenders’ removal of the retiring Agent, then the retiring Agent may, on behalf of the Lender Parties, appoint a successor Agent, which shall be a commercial bank organized under the laws of the United States or of any State thereof and having a combined capital and surplus of at least $250,000,000.  Upon the acceptance of any appointment as an Agent hereunder by a successor Agent, and, in the case of a successor Collateral Agent, upon the execution and filing or recording of such financing statements, or amendments thereto, and such amendments or supplements to the Mortgages and such other instruments or notices, as may be necessary or desirable, or as the Required Lenders may request, in order to continue the perfection of the Liens granted or purported to be granted by the Collateral Documents, such successor Agent shall succeed to and become vested with all the rights, powers, discretion, privileges and duties of the retiring Agent, and the retiring Agent shall be discharged from its duties and obligations under the Loan Documents.  If within 45 days after written notice is given of the retiring Agent’s resignation or removal under this Section 8.06 no successor Agent shall have been appointed and shall have accepted such appointment, then on such 45th day (i) the retiring Agent’s resignation or removal shall become effective, (ii) the retiring Agent shall thereupon be discharged from its duties and obligations under the Loan Documents and (iii) the Required Lenders shall thereafter perform all duties of the retiring Agent under the Loan Documents until such time, if any, as the Required Lenders appoint a successor Agent as provided above.  After any retiring Agent’s resignation or removal hereunder as an Agent shall have become effective, the provisions of this Article VIII shall inure to its benefit as to any actions taken or omitted to be taken by it while it was an Agent under this Agreement.

 

(b)           In addition to the foregoing, if a Lender becomes, and during the period it remains, a Defaulting Lender or a Potential Defaulting Lender, the Issuing Bank and/or the Swing Line Bank may, upon prior written notice to the Borrower and the Administrative Agent, resign as Issuing Bank or Swing Line Bank, respectively, effective at the close of business New York time on a date specified in such notice (which date may not be less than thirty (30) days after the date of such notice), provided that such resignation by the Issuing Bank will have no effect on the validity or enforceability of any Letter of Credit then outstanding or on the obligations of the Borrower or any Lender under this Agreement with respect to any such outstanding Letter of Credit or otherwise to the Issuing Bank; and provided, further, that such resignation by the Swing Line Bank will have no effect on its rights in respect of any outstanding Swing Line Advances or on the obligations of the Borrower or any Lender under this Agreement with respect to any such outstanding Swing Line Advance.

 

SECTION 8.07                                 Relationship of Agents and Lenders.  The relationship between Agents (or either of them) and the Lenders, and the relationship among the Lenders, is not intended by the parties to create, and shall not create, any trust, joint venture or partnership relation between them.

 

ARTICLE IX
 MISCELLANEOUS

 

SECTION 9.01                                 Amendments, Etc.  (a)  No amendment or waiver of any provision of this Agreement or the Notes or any other Loan Document, nor consent to any departure by any Loan Party therefrom, shall in any event be effective unless the same shall be in writing and signed (or, in the case of the Collateral Documents, consented to) by the Required Lenders, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that no amendment, waiver or consent shall, unless in writing and signed by all of the Lenders (except as otherwise provided in this Section 9.01(a)), do any of the following at any time:  (i) modify the definition of Required Lenders or otherwise change the percentage vote of the Lenders required to take any action under this Agreement or any other Loan Document, (ii) release the Borrower with respect to the Obligations or, except to the extent expressly permitted under this Agreement,  reduce or limit the obligations of any Guarantor or the Borrower under Article VII or release such Guarantor or the Borrower or otherwise limit such Guarantor’s or the Borrower’s liability with respect to the Guaranteed Obligations or the Obligations, as the case may be, (iii) release all or substantially all of the Collateral (other than pursuant to Section 5.02(e) or 9.11) or permit

 

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the Loan Parties to encumber the Collateral, except as expressly permitted in the Loan Documents, (iv) amend this Section 9.01, (v) increase the Commitments of any Lender or subject any Lender to any additional obligations without the prior written consent of such Lender (other than as provided by Section 2.19), (vi) forgive or reduce the principal of, or interest on, the Obligations of the Loan Parties under the Loan Documents or any fees or other amounts payable thereunder without the prior written consent of each Lender affected thereby, (vii) postpone or extend any scheduled payment date for any payment of principal of, or interest on, the Notes or any scheduled payment date for any fees or other amounts payable hereunder or extend the Termination Date, other than in each case as provided by Section 2.16, without the prior written consent of each Lender affected thereby, (viii) provide for payment of the Facility in any manner other than in cash in U.S. Dollars, (ix) take any other action specifically requiring the consent of all Lenders under the Loan Documents, (x) change Section 2.11(f) or Section 2.13, or (xi) change the definition of “Facility Available Amount” or any other definition used in the determination thereof; provided further that no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Bank or each Issuing Bank, as the case may be, in addition to the Lenders required above to take such action, affect the rights or obligations of the Swing Line Bank or of the Issuing Banks, as the case may be, under this Agreement; and provided further that no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent or the Collateral Agent in addition to the Lenders required above to take such action, affect the rights or duties of the Administrative Agent or the Collateral Agent, as the case may be, under this Agreement or the other Loan Documents.

 

(b)                                 In the event that any Lender (a “Non-Consenting Lender”) shall, for more than 30 days after solicitation in writing from the Administrative Agent, fail to consent to a waiver or amendment to, or a departure from, the provisions of this Agreement which requires the consent of all Lenders and that has been consented to by the Administrative Agent and the Required Lenders, then the Borrower shall have the right, upon written demand to such Non-Consenting Lender and the Administrative Agent given within 30 days after the first date on which such consent was solicited in writing from the Lenders by the Administrative Agent (a “Consent Request Date”), to cause such Non-Consenting Lender to assign its rights and obligations under this Agreement (including, without limitation, its Commitment or Commitments, the Advances owing to it and the Note or Notes, if any, held by it) to a Replacement Lender, provided that (i) as of such Consent Request Date, no Default or Event of Default shall have occurred and be continuing, (ii) as of the date of the Borrower’s written demand to replace such Non-Consenting Lender, no Default or Event of Default shall have occurred and be continuing other than a Default or Event of Default that resulted solely from the subject matter of the waiver or amendment for which such consent was being solicited from the Lenders by the Administrative Agent, (iii) the replacement of any Non-Consenting Lender shall be consummated in accordance with and subject to the provisions of Section 2.18, and (iv) such Replacement Lender shall have consented to such waiver or amendment.  The Replacement Lender shall purchase such interests of the Non-Consenting Lender and shall assume the rights and obligations of the Non-Consenting Lender under this Agreement upon execution by the Replacement Lender of an Assignment and Acceptance delivered pursuant to Section 9.07.

 

(c)                                  Anything herein to the contrary notwithstanding, during such period as a Lender is a Defaulting Lender, to the fullest extent permitted by applicable law, such Lender will not be entitled to vote in respect of amendments and waivers hereunder and the Commitment and the outstanding Advances or other extensions of credit of such Lender hereunder will not be taken into account in determining whether the Required Lenders or all of the Lenders, as required, have approved any such amendment or waiver (and the definition of “Required Lenders” will automatically be deemed modified accordingly for the duration of such period, provided that any such amendment or waiver that would increase or extend the term of the Commitment of such Defaulting Lender, extend the date fixed for the payment of principal or interest owing to such Defaulting Lender hereunder, reduce the principal amount of any obligation owing to such Defaulting Lender, reduce the amount of or the rate or amount of interest on any amount owing to such Defaulting Lender or of any fee payable to such Defaulting Lender hereunder, or alter the terms of this proviso, will require the consent of such Defaulting Lender.

 

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SECTION 9.02                      Notices, Etc.  (a)  All  notices  and  other  communications  provided  for  hereunder  shall  be  either  (x) in  writing  (including  telecopier  communication)  and  mailed,  telecopied  or  delivered  by  hand  or  by  overnight  courier  service,  (y) as  and  to  the  extent  set  forth  in  Section 9.02(b) and  in  the  proviso  to  this  Section 9.02(a),  in  an  electronic  medium  and  delivered  as  set  forth  in  Section 9.02(b) or  (z) as  and  to  the  extent  expressly  permitted  in  this  Agreement,  transmitted  by  e-mail,  provided  that  such e-mail shall in all cases include an attachment (in PDF format or similar format) containing a legible signature of the person providing such notice, if to the Borrower, at its address at 400 Centre Street, Newton, MA 02458, Attention:  Bruce J. Mackey, Jr., President and Chief Executive Officer, or, if applicable, at bmackey@5ssl.com (and in the case of transmission by e-mail, with a copy by U.S. mail to the attention of Bruce J. Mackey, Jr., President and Chief Executive Officer, 400 Centre Street, Newton, MA 02458), with a copy to Katherine E. Potter, Senior Vice President and General Counsel, Five Star Quality Care, Inc., 400 Centre Street, Newton, MA 02458 or, if applicable, at kpotter@5ssl.com (and in the case of transmission by e-mail, with a copy by U.S. mail to the attention of Katherine E. Potter, Senior Vice President and General Counsel, at 400 Centre Street, Newton, MA 02458); if to any Initial Lender, at its Domestic Lending Office or, if applicable, at the telecopy number or e-mail address specified opposite its name on Schedule I hereto (and in the case of a transmission by e-mail, with a copy by U.S. mail to its Domestic Lending Office); if to any other Lender Party, at its Domestic Lending Office or, if applicable, at the telecopy number or e-mail address specified in the Assignment and Acceptance pursuant to which it became a Lender Party (and in the case of a transmission by e-mail, with a copy by U.S. mail to its Domestic Lending Office); if to the Existing Issuing Bank or the Initial Issuing Bank, at its address at 1615 Brett Road OPS III, New Castle, DE 19720, Attention:  Bank Loan Syndications Department, or, if applicable, at robert.ross@citigroup.com (and in the case of a transmission by e-mail, with a copy by U.S. mail to 1615 Brett Road OPS III, New Castle, DE 19720, Attention:  Bank Loan Syndications Department); and if to the Administrative Agent, the Collateral Agent or the Swing Line Bank, at its address at 1615 Brett Road OPS III, New Castle, DE 19720, Attention:  Bank Loan Syndications Department, or, if applicable, at robert.ross@citigroup.com (and in the case of a transmission by e-mail, with a copy by U.S. mail to 1615 Brett Road OPS III, New Castle, DE 19720, Attention:  Bank Loan Syndications Department) or, as to the Borrower or any Agent, at such other address as shall be designated by such party in a written notice to the other parties and, as to each other party, at such other address as shall be designated by such party in a written notice to the Borrower and the Administrative Agent.  All notices, demands, requests, consents and other communications described in this clause (a) shall be effective (i) if delivered by hand, including any overnight courier service, upon personal delivery, (ii) if delivered by mail, when deposited in the mails, (iii) if delivered by posting to an Approved Electronic Platform, an Internet website or a similar telecommunication device requiring that a user have prior access to such Approved Electronic Platform, website or other device (to the extent permitted by Section 9.02(b) to be delivered thereunder), when such notice, demand, request, consent and other communication shall have been made generally available on such Approved Electronic Platform, Internet website or similar device to the class of Person being notified (regardless of whether any such Person must accomplish, and whether or not any such Person shall have accomplished, any action prior to obtaining access to such items, including registration, disclosure of contact information, compliance with a standard user agreement or undertaking a duty of confidentiality) and such Person has been notified in respect of such posting that a communication has been posted to the Approved Electronic Platform, provided that if requested by any Lender Party, the Administrative Agent shall deliver a copy of the Communications to such Lender Party by e-mail or telecopier and (iv) if delivered by electronic mail or any other telecommunications device, when receipt is confirmed by electronic mail as provided in this clause (a); provided, however, that notices and communications to any Agent pursuant to Article II, III or VIII or to the Collateral Agent under the Collateral Documents shall not be effective until received by such Agent or the Collateral Agent, as the case may be.  Delivery by telecopier of an executed counterpart of a signature page to any amendment or waiver of any provision of this Agreement or the Notes or of any Exhibit hereto to be executed and delivered hereunder shall be effective as delivery of an original executed counterpart thereof.  Each Lender Party agrees (i) to notify the Administrative Agent in writing of such Lender Party’s e-mail address to which a notice may be sent by electronic transmission (including by electronic communication) on or before the date such Lender Party becomes a party to this Agreement (and from time to time thereafter to ensure that the Administrative Agent has on record an effective e-mail address for such Lender Party) and (ii) that any notice may be sent to such e-mail address.

 

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(b)                                 Notwithstanding clause (a) (unless the Administrative Agent requests that the provisions of clause (a) be followed) and any other provision in this Agreement or any other Loan Document providing for the delivery of any Approved Electronic Communication by any other means, the Loan Parties shall deliver all Approved Electronic Communications to the Administrative Agent by properly transmitting such Approved Electronic Communications in an electronic/soft medium in a format acceptable to the Administrative Agent to oploanswebadmin@citigroup.com or such other electronic mail address (or similar means of electronic delivery) as the Administrative Agent may notify to the Borrower.  Nothing in this clause (b) shall prejudice the right of the Administrative Agent or any Lender Party to deliver any Approved Electronic Communication to any Loan Party in any manner authorized in this Agreement or to request that the Borrower effect delivery in such manner.

 

(c)                                  Each of the Lender Parties and each Loan Party agrees that the Administrative Agent may, but shall not be obligated to, make the Approved Electronic Communications available to the Lender Parties by posting such Approved Electronic Communications on IntraLinksTM or a substantially similar electronic platform chosen by the Administrative Agent to be its electronic transmission system (the “Approved Electronic Platform”).  Although the Approved Electronic Platform and its primary web portal are secured with generally-applicable security procedures and policies implemented or modified by the Administrative Agent from time to time (including, as of the Closing Date, a dual firewall and a User ID/Password Authorization System) and the Approved Electronic Platform is secured through a single-user-per-deal authorization method whereby each user may access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lender Parties and each Loan Party acknowledges and agrees that the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution.  In consideration for the convenience and other benefits afforded by such distribution and for the other consideration provided hereunder, the receipt and sufficiency of which is hereby acknowledged, each of the Lender Parties and each Loan Party hereby approves distribution of the Approved Electronic Communications through the Approved Electronic Platform and understands and assumes the risks of such distribution.

 

(d)                                 THE APPROVED ELECTRONIC PLATFORM AND THE APPROVED ELECTRONIC COMMUNICATIONS ARE PROVIDED “AS IS” AND “AS AVAILABLE”.  NONE OF THE ADMINISTRATIVE AGENT NOR ANY OF ITS DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES WARRANT THE ACCURACY, ADEQUACY OR COMPLETENESS OF THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM AND EACH EXPRESSLY DISCLAIMS ANY LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE ADMINISTRATIVE AGENT OR ANY OF ITS DIRECTORS, OFFICERS, AGENTS OR EMPLOYEES IN CONNECTION WITH THE APPROVED ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM.

 

(e)                                  Each of the Lender Parties and each Loan Party agrees that the Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to, store the Approved Electronic Communications on the Approved Electronic Platform in accordance with the Administrative Agent’s generally-applicable document retention procedures and policies.

 

SECTION 9.03                                 No Waiver; Remedies.  No failure on the part of any Lender Party or any Agent to exercise, and no delay in exercising, any right hereunder or under any Note shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right.  The remedies herein provided are cumulative and not exclusive of any remedies provided by law.

 

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SECTION 9.04                                 Costs and Expenses.  (a)  Each Loan Party agrees jointly and severally to pay on demand (i) all reasonable out-of-pocket costs and expenses of each Agent in connection with the preparation, execution, delivery, administration, modification and amendment of the Loan Documents (including, without limitation, (A) all due diligence, collateral review, syndication, transportation, computer, duplication, appraisal, audit, insurance, consultant, search, filing and recording fees and expenses, (B) the reasonable fees and expenses of counsel for such Agent with respect thereto (including, without limitation, with respect to reviewing and advising on any matters required to be completed by the Loan Parties on a post-closing basis), with respect to advising such Agent as to its rights and responsibilities, or the perfection, protection or preservation of rights or interests, under the Loan Documents, with respect to negotiations with any Loan Party or with other creditors of any Loan Party or any of its Subsidiaries arising out of any Default or any events or circumstances that may give rise to a Default and with respect to presenting claims in or otherwise participating in or monitoring any bankruptcy, insolvency or other similar proceeding involving creditors’ rights generally and any proceeding ancillary thereto and (C) the reasonable fees and expenses of counsel for such Agent with respect to the preparation, execution, delivery and review of any documents and instruments at any time delivered pursuant to Sections 3.01, 3.02, 5.01(j) or 5.01(k) and (ii) all reasonable out-of-pocket costs and expenses of each Agent and each Lender Party in connection with the enforcement (whether through negotiations, legal proceedings or otherwise) of the Loan Documents, whether in any action, suit or litigation, or any bankruptcy, insolvency or other similar proceeding affecting creditors’ rights generally (including, without limitation, the reasonable fees and expenses of counsel for such Agent and each Lender Party with respect thereto).

 

(b)                                 Each Loan Party agrees to indemnify, defend and save and hold harmless each Indemnified Party from and against, and shall pay on demand, any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and expenses of counsel) that may be incurred by or asserted or awarded against any Indemnified Party, in each case arising out of or in connection with or by reason of (including, without limitation, in connection with any investigation, litigation or proceeding or preparation of a defense in connection therewith) (i) the Facilities, the actual or proposed use of the proceeds of the Advances or the Letters of Credit, the Loan Documents or any of the transactions contemplated thereby or (ii) the actual or alleged presence of Hazardous Materials on any property of any Loan Party or any of its Subsidiaries or any Environmental Action relating in any way to any Loan Party or any of its Subsidiaries, except to the extent such claim, damage, loss, liability or expense is found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party’s gross negligence or willful misconduct.  In the case of an investigation, litigation or other proceeding to which the indemnity in this Section 9.04(b) applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by any Loan Party, its directors, shareholders or creditors or an Indemnified Party, whether or not any Indemnified Party is otherwise a party thereto and whether or not the transactions contemplated by the Loan Documents are consummated.  Each Loan Party also agrees not to assert any claim against any Agent, any Lender Party or any of their Affiliates, or any of their respective officers, directors, employees, agents and advisors, on any theory of liability, for special, indirect, incidental, consequential or punitive damages arising out of or otherwise relating to the Facilities, the actual or proposed use of the proceeds of the Advances or the Letters of Credit, the Loan Documents or any of the transactions contemplated by the Loan Documents.  This Section 9.04(b) shall not apply with respect to Taxes, as to which Section 2.12 shall govern.

 

(c)                                  If any payment of principal of, or Conversion of, any Eurodollar Rate Advance is made by the Borrower to or for the account of a Lender Party other than on the last day of the Interest Period for such Advance, as a result of a payment or Conversion pursuant to Section 2.06, 2.09(b)(i), 2.10(d) or 2.19(e), acceleration of the maturity of the Notes pursuant to Section 6.01 or for any other reason, or if the Borrower fails to make any payment or prepayment of an Advance for which a notice of prepayment has been given or that is otherwise required to be made, whether pursuant to Section 2.04, 2.06 or 6.01 or otherwise, the Borrower shall, upon demand by such Lender Party (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender Party any amounts required to compensate such Lender Party for any additional losses, costs or expenses that it may reasonably incur as a result of such payment or Conversion or such failure to pay or prepay, as the case may be, including, without limitation, any

 

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loss, cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by any Lender Party to fund or maintain such Advance.

 

(d)           If any Loan Party fails to pay when due any costs, expenses or other amounts payable by it under any Loan Document, including, without limitation, fees and expenses of counsel and indemnities, such amount may be paid on behalf of such Loan Party by any Agent or any Lender Party, in its sole discretion.

 

(e)                                  Without prejudice to the survival of any other agreement of any Loan Party hereunder or under any other Loan Document, the agreements and obligations of the Borrower and the other Loan Parties contained in Sections 2.10 and 2.12, Section 7.06 and this Section 9.04 shall survive the payment in full of principal, interest and all other amounts payable hereunder and under any of the other Loan Documents.

 

(f)                                   No Indemnified Party referred to in Section 9.04(b) shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.

 

SECTION 9.05                                 Right of Set-off.  Upon (a) the occurrence and during the continuance of any Event of Default and (b) the making of the request or the granting of the consent specified by Section 6.01 to authorize the Administrative Agent to declare the Notes due and payable pursuant to the provisions of Section 6.01, each Agent and each Lender Party and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and otherwise apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by such Agent, such Lender Party or such Affiliate to or for the credit or the account of the Borrower or any other Loan Party against any and all of the Obligations of the Borrower or such Loan Party now or hereafter existing under the Loan Documents, irrespective of whether such Agent or such Lender Party shall have made any demand under this Agreement or such Note or Notes and although such obligations may be unmatured.  If such deposits are not pledged pursuant to a valid security agreement, the prior written consent of the Administrative Agent shall be obtained before any right of set-off shall be exercised.  Each Agent and each Lender Party agrees promptly to notify the Borrower or such Loan Party after any such set-off and application; provided, however, that the failure to give such notice shall not affect the validity of such set-off and application.  The rights of each Agent and each Lender Party and their respective Affiliates under this Section 9.05 are in addition to other rights and remedies (including, without limitation, other rights of set-off) that such Agent, such Lender Party and their respective Affiliates may have; provided, however, that in the event that any Defaulting Lender exercises such right of setoff, (x) all amounts so set off will be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.17(b) and, pending such payment, will be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent, the Issuing Bank, the Swing Line Bank and the Lenders and (y) the Defaulting Lender will provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff.

 

SECTION 9.06                                 Binding Effect.  This Agreement shall become effective when it shall have been executed by the Borrower, each Guarantor named on the signature pages hereto and the Administrative Agent shall have been notified by each Initial Lender and each Initial Issuing Bank that such Initial Lender or such Initial Issuing Bank, as the case may be, has executed it and thereafter shall be binding upon and inure to the benefit of the Borrower, the Guarantors named on the signature pages hereto and each Agent and each Lender Party and their respective successors and assigns, except that neither the Borrower nor any other Loan Party shall have the right to assign its rights hereunder or any interest herein without the prior written consent of the Lender Parties.

 

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SECTION 9.07                                 Assignments and Participations; Replacement Notes.  (a)  Each Lender may (and, if demanded by the Borrower in accordance with Section 9.01(b) will) assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitment or Commitments, the Advances owing to it and the Note or Notes held by it); provided, however, that (i) each such assignment shall be of a uniform, and not a varying, percentage of all rights and obligations under and in respect of one or more of the Facilities, (ii) except in the case of an assignment to a Person that, immediately prior to such assignment, was a Lender, an Affiliate of any Lender or a Fund Affiliate of any Lender or an assignment of all of a Lender’s rights and obligations under this Agreement, the aggregate amount of the Commitments being assigned to such Eligible Assignee pursuant to such assignment (determined as of the date of the Assignment and Acceptance with respect to such assignment) shall in no event be less than $5,000,000 under each Facility or an integral multiple of $1,000,000 in excess thereof (or such lesser amount as shall be approved by the Administrative Agent and, so long as no Default shall have occurred and be continuing at the time of effectiveness of such assignment, the Borrower), (iii) each such assignment shall be to an Eligible Assignee, (iv) each such assignment made as a result of a demand by the Borrower pursuant to Section 9.01(b) shall be an assignment at par of all rights and obligations of the assigning Lender under this Agreement, (v) no such assignments shall be permitted without the consent of the Administrative Agent (which consent shall not be unreasonably withheld), except if such assignment is being made by a Lender to an Affiliate or Fund Affiliate of such Lender, (vi) no such assignments shall be made to any Defaulting Lender or Potential Defaulting Lender or any of their respective subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause, and (vii) the parties to each such assignment shall execute and deliver to the Administrative Agent, for its acceptance and recording in the Register, an Assignment and Acceptance, together with any Note or Notes subject to such assignment and, except if such assignment is being made by a Lender to an Affiliate or Fund Affiliate of such Lender, a processing and recordation fee of $3,500; provided, however, that (x) the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment, and (y) for each such assignment made as a result of a demand by the Borrower pursuant to Section 9.01(b), the Borrower shall pay to the Administrative Agent the applicable processing and recordation fee.  In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment will be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Advances previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent, the Issuing Bank, the Swing Line Bank and each other Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as appropriate) its full pro rata share of all Advances and participants in Letters of Credit and Swing Line Advances in accordance with its Pro Rata Share.  Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder becomes effective under applicable law without compliance with the provisions of this paragraph, then the assignee of such interest will be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

 

(b)                                 Upon such execution, delivery, acceptance and recording, from and after the effective date specified in such Assignment and Acceptance, (i) the assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, have the rights and obligations of a Lender or Issuing Bank, as the case may be, hereunder and (ii) the Lender or Issuing Bank assignor thereunder shall, to the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights (other than its rights under Sections 2.10, 2.12, 7.06, 8.05 and 9.04 to the extent any claim thereunder relates to an event arising prior to such assignment) and be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the remaining portion of an assigning Lender’s or

 

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Issuing Bank’s rights and obligations under this Agreement, such Lender or Issuing Bank shall cease to be a party hereto).

 

(c)                                  By executing and delivering an Assignment and Acceptance, each Lender Party assignor thereunder and each assignee thereunder confirm to and agree with each other and the other parties thereto and hereto as follows:  (i) other than as provided in such Assignment and Acceptance, such assigning Lender Party makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with any Loan Document or the execution, legality, validity, enforceability, genuineness, sufficiency or value of, or the perfection or priority of any lien or security interest created or purported to be created under or in connection with, any Loan Document or any other instrument or document furnished pursuant thereto; (ii) such assigning Lender Party makes no representation or warranty and assumes no responsibility with respect to the financial condition of any Loan Party or the performance or observance by any Loan Party of any of its obligations under any Loan Document or any other instrument or document furnished pursuant thereto; (iii) such assignee confirms that it has received a copy of this Agreement, together with copies of the financial statements referred to in Section 4.01 and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Acceptance; (iv) such assignee will, independently and without reliance upon any Agent, such assigning Lender Party or any other Lender Party and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement; (v) such assignee confirms that it is an Eligible Assignee; (vi) such assignee appoints and authorizes each Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Loan Documents as are delegated to such Agent by the terms hereof and thereof, together with such powers and discretion as are reasonably incidental thereto; and (vii) such assignee agrees that it will perform in accordance with their terms all of the obligations that by the terms of this Agreement are required to be performed by it as a Lender or Issuing Bank, as the case may be.

 

(d)                                 The Administrative Agent shall maintain at its address referred to in Section 9.02 a copy of each Assignment and Acceptance delivered to and accepted by it and a register for the recordation of the names and addresses of the Lender Parties and the Commitment under each Facility of, and principal amount of the Advances owing under each Facility to, each Lender Party from time to time (the “Register”).  The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the Borrower, the Agents and the Lender Parties may treat each Person whose name is recorded in the Register as a Lender Party hereunder for all purposes of this Agreement.  The Register shall be available for inspection by the Borrower or any Agent or any Lender Party at any reasonable time and from time to time upon reasonable prior notice.

 

(e)                                  Upon its receipt of an Assignment and Acceptance executed by an assigning Lender Party and an assignee, together with any Note or Notes subject to such assignment, the Administrative Agent shall, if such Assignment and Acceptance has been completed and is in substantially the form of Exhibit D hereto, (i) accept such Assignment and Acceptance, (ii) record the information contained therein in the Register and (iii) give prompt notice thereof to the Borrower and each other Agent.  In the case of any assignment by a Lender, within five Business Days after its receipt of such notice, the Borrower, at its own expense, shall, if requested by the applicable Lender, execute and deliver to the Administrative Agent in exchange for the surrendered Note or Notes a substitute Note to the order of such Eligible Assignee in an amount equal to the Commitment assumed by it under each Facility pursuant to such Assignment and Acceptance and, if any assigning Lender has retained a Commitment hereunder under such Facility, a substitute Note to the order of such assigning Lender in an amount equal to the Commitment retained by it hereunder.  Such substitute Note or Notes, if any, shall be in an aggregate principal amount equal to the aggregate principal amount of such surrendered Note or Notes, shall be dated the effective date of such Assignment and Acceptance and shall otherwise be in substantially the form of Exhibit A hereto.

 

(f)                                   Each Issuing Bank may assign to one or more Eligible Assignees all or a portion of its rights and obligations under the undrawn portion of its Letter of Credit Commitment at any time; provided, however, that (i) except in the case of an assignment to a Person that immediately prior to such assignment was

 

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an Issuing Bank or an assignment of all of an Issuing Bank’s rights and obligations under this Agreement, the amount of the Letter of Credit Commitment of the assigning Issuing Bank being assigned pursuant to each such assignment (determined as of the date of the Assignment and Acceptance with respect to such assignment) shall in no event be less than $5,000,000 and shall be in an integral multiple of $1,000,000 in excess thereof, (ii) each such assignment shall be to an Eligible Assignee and (iii) the parties to each such assignment shall execute and deliver to the Administrative Agent, for its acceptance and recording in the Register, an Assignment and Acceptance, together with a processing and recordation fee of $3,500, provided that such fee shall not be payable if the assigning Issuing Bank is making such assignment simultaneously with the assignment in its capacity as a Lender of all or a portion of its Revolving Credit Commitment to the same Eligible Assignee.

 

(g)                                  Each Lender Party may sell participations to one or more Persons (other than any Loan Party or any of its Affiliates) in or to all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitments, the Advances owing to it and the Note or Notes (if any) held by it); provided, however, that (i) such Lender Party’s obligations under this Agreement (including, without limitation, its Commitments) shall remain unchanged, (ii) such Lender Party shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) such Lender Party shall remain the holder of any such Note for all purposes of this Agreement, (iv) the Borrower, the Agents and the other Lender Parties shall continue to deal solely and directly with such Lender Party in connection with such Lender Party’s rights and obligations under this Agreement, (v) no participant under any such participation shall have any right to approve any amendment or waiver of any provision of any Loan Document, or any consent to any departure by any Loan Party therefrom, except to the extent that such amendment, waiver or consent would reduce the principal of, or interest on, the Notes or any fees or other amounts payable hereunder, in each case to the extent subject to such participation, or postpone any date fixed for any payment of principal of, or interest on, the Notes or any fees or other amounts payable hereunder, in each case to the extent subject to such participation, or release all or substantially all of the Collateral and (vi) a Participant shall be entitled to the benefits of Sections 2.10, 2.12, and 9.04(c) (subject to the requirements and limitations therein, including the requirements under Sections 2.12(f) and 2.12(g) (it being understood that the documentation required under Sections 2.12(f) and 2.12(g) shall be delivered to the participating Lender Party)) to the same extent as if it were a Lender Party and had acquired its interest by assignment pursuant to Section 9.07(a); provided, however, that (A) such Participant shall not be entitled to receive any greater payment under Section 2.10, 2.12, or 9.04(c) with respect to any participation than its participating Lender Party would have been entitled to receive, except, in the case of Sections 2.10 and 2.12 only, to the extent such entitlement to receive a greater payment results from a change in law or increased cost, as applicable, that occurs after the Participant acquired the applicable participation, (B) such Participant shall agree to be subject to the Lender mitigation and replacement provisions of Sections 2.10(a) and (d), 2.12(j) and 2.18 as if it were an assignee under paragraph (a) of this Section, and (C) each Lender that sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 2.18 with respect to any Participant.  Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Advances or any other Obligations under the Loan Documents (the “Participant Register”), provided, however, that no Lender shall have any obligation to disclose all or any portion of such Participant Register (including the identity of any Participant or any information relating to any Participant’s interest in any such Commitment, Advances or any other Obligations, under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Commitment, Advance or other Obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.  For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

 

(h)                                 Any Lender Party may, in connection with any assignment or participation or proposed assignment or participation pursuant to this Section 9.07, disclose to the assignee or participant or

 

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proposed assignee or participant any information relating to the Loan Parties (or any of them) furnished to such Lender Party by or on behalf of any Loan Party; provided, however, that prior to any such disclosure, the assignee or participant or proposed assignee or participant shall agree to preserve the confidentiality of any Information received by it from such Lender Party on the same terms as provided in Section 9.12.

 

(i)                                     Notwithstanding any other provision set forth in this Agreement, any Lender Party may at any time pledge or assign, or grant a security interest in all or any portion of its rights under this Agreement (including, without limitation, any pledge or assignment of, or grant of a security interest in, the Advances owing to such Lender and any Note or Notes held by it), including in favor of any Federal Reserve Bank in accordance with Regulation A of the Board of Governors of the Federal Reserve System or any other central bank in accordance with applicable local laws or regulations.

 

(j)                                    Upon notice to the Borrower from the Administrative Agent or any Lender of the loss, theft, destruction or mutilation of any Lender’s Note, the Borrower will execute and deliver, in lieu of such original Note, a replacement promissory note, identical in form and substance to, and dated as of the same date as, the Note so lost, stolen or mutilated, subject to delivery by such Lender to the Borrower of an affidavit of lost note and indemnity in customary form.  Upon the execution and delivery of the replacement Note, all references herein or in any of the other Loan Documents to the lost, stolen or mutilated Note shall be deemed references to the replacement Note.

 

SECTION 9.08                                 Execution in Counterparts.  This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of a signature page to this Agreement by telecopier or by email with a pdf or similar attachment shall be effective as delivery of an original executed counterpart of this Agreement.

 

SECTION 9.09                                 Severability.  In case one or more provisions of this Agreement or the other Loan Documents shall be invalid, illegal or unenforceable in any respect under any applicable law, the validity, legality and enforceability of the remaining provisions contained herein or therein shall not be affected or impaired thereby.

 

SECTION 9.10                                 Usury Not Intended.  It is the intent of the Borrower and each Lender Party in the execution and performance of this Agreement and the other Loan Documents to contract in strict compliance with applicable usury laws, including conflicts of law concepts, governing the Advances of each Lender Party including such applicable laws of the State of New York and the United States of America from time to time in effect.  In furtherance thereof, the Lender Parties and the Borrower stipulate and agree that none of the terms and provisions contained in this Agreement or the other Loan Documents shall ever be construed to create a contract to pay, as consideration for the use forbearance or detention of money, interest at a rate in excess of the Maximum Rate and that for purposes hereof “interest” shall include the aggregate of all charges which constitute interest under such laws that are contracted for, taken, charged, received, reserved or paid under this Agreement; and in the event that, notwithstanding the foregoing, under any circumstances the aggregate amounts contracted for, taken, charged, received, reserved or paid on the Advances, include amounts which, by applicable law, are deemed interest which would exceed the Maximum Rate, then such excess shall be deemed to be a mistake and, each Lender Party receiving the same shall credit the same on the principal of the Obligations of the Borrower under the Loan Documents (or if such Obligations shall have been paid in full, refund said excess to the Borrower).  In the event that the Obligations of the Borrower under the Loan Documents are accelerated by reason of any Event of Default under this Agreement or otherwise, or in the event of any required or permitted prepayment, then such consideration that constitutes interest may never include more than the Maximum Rate and excess interest, if any, provided for in this Agreement or otherwise shall be canceled automatically as of the date of such acceleration or prepayment and, if theretofore paid, shall be credited on the principal of the Obligations of the Borrower under the Loan Documents (or, if such Obligations shall have been paid in full, refunded to the Borrower).  In determining whether or not the interest paid or payable under any specific contingencies exceeds the Maximum Rate, the Borrower and the Lender

 

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Parties shall to the maximum extent permitted under applicable law amortize, prorate, allocate and spread in equal parts during the period of the full stated term of the Facility all amounts considered to be interest under applicable law at any time contracted for, taken, charged, received,  reserved or paid in connection with the Obligations of the Loan Parties under the Loan Documents.  The provisions of this Section shall control over all other provisions of this Agreement or the other Loan Documents which may be in apparent conflict herewith.

 

SECTION 9.11                                 No Liability of the Issuing Banks.  (a) The Borrower assumes all risks of the acts or omissions of any beneficiary or transferee of any Letter of Credit with respect to its use of such Letter of Credit.  Neither any Issuing Bank nor any of its officers or directors shall be liable or responsible for:  (a) the use that may be made of any Letter of Credit or any acts or omissions of any beneficiary or transferee in connection therewith; (b) the validity, sufficiency or genuineness of documents, or of any endorsement thereon, even if such documents should prove to be in any or all respects invalid, insufficient, fraudulent or forged; (c) payment by such Issuing Bank against presentation of documents that do not comply with the terms of a Letter of Credit, including failure of any documents to bear any reference or adequate reference to the Letter of Credit; or (d) any other circumstances whatsoever in making or failing to make payment under any Letter of Credit, except that the Borrower shall have a claim against such Issuing Bank, and such Issuing Bank shall be liable to the Borrower, to the extent of any direct, but not consequential, damages suffered by the Borrower that the Borrower proves were caused by (i) such Issuing Bank’s willful misconduct or gross negligence as determined in a final, non-appealable judgment by a court of competent jurisdiction in determining whether documents presented under any Letter of Credit comply with the terms of the Letter of Credit or (ii) such Issuing Bank’s willful failure to make lawful payment under a Letter of Credit after the presentation to it of a draft and certificates strictly complying with the terms and conditions of the Letter of Credit.  In furtherance and not in limitation of the foregoing, such Issuing Bank may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary.

 

SECTION 9.12                                 Confidentiality.  (a)  Each of the Agents, the Lender Parties and the Issuing Bank agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (i) to its Affiliates and to its and its Affiliates’ respective managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (ii) to the extent requested by any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (iii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (iv) to any other party hereto, (v) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (vi) subject to an agreement containing provisions at least as restrictive as those of this Section, (vii) to any assignee of or participant in, or any prospective assignee of or participant in, any of its rights or obligations under this Agreement, (viii) to any actual or prospective party (or its managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives) to any swap, derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, this Agreement or payments hereunder, (ix) to any rating agency, (x) to the CUSIP Service Bureau or any similar agency, (xi) with the consent of the Borrower or (xii) to the extent such Information (A) becomes publicly available other than as a result of a breach of this Section 9.12 or (B) becomes available to such Agent, such Lender Party, the Issuing Bank or any of their respective Affiliates on a non-confidential basis from a source other than the Borrower or any of its Subsidiaries without such Agent, such Lender Party, the Issuing Bank or any of their respective Affiliates having knowledge that a duty of confidentiality to the Borrower or any of its Subsidiaries has been breached.  In addition, the Administrative Agent and the Lender Parties may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry and service providers to the Administrative Agent and the Lender Parties in connection with the administration of this Agreement, the other Loan Documents, and the Commitments.  For purposes of this Section, “Information” means all information that any Loan Party furnishes to the

 

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Administrative Agent or any Lender Party in writing designated as confidential, but does not include any such information that is or becomes generally available to the public other than by way of a breach of the confidentiality provisions of this Section 9.12 or that is or becomes available to the Administrative Agent or such Lender Party from a source other than the Loan Parties or the Administrative Agent or any other Lender Party and not in violation of any confidentiality agreement with respect to such information that is actually known to the Administrative Agent or such Lender Party.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

(b)                                 Certain of the Lender Parties may enter into this Agreement and take or not take action hereunder or under the other Loan Documents on the basis of information that does not contain material non-public information with respect to any of the Borrower, any of its Subsidiaries or their respective securities (“Restricting Information”).  Other Lender Parties may enter into this Agreement and take or not take action hereunder or under the other Loan Documents on the basis of information that may contain Restricting Information.  Each Lender Party acknowledges that United States federal and state securities laws prohibit any person from purchasing or selling securities on the basis of material, non-public information concerning the issuer of such securities or, subject to certain limited exceptions, from communicating such information to any other Person.  None of any Agent or any of its respective directors, officers, agents or employees shall, by making any Communications (including Restricting Information) available to a Lender Party, by participating in any conversations or other interactions with a Lender Party or otherwise, make or be deemed to make any statement with regard to or otherwise warrant that any such information or Communication does or does not contain Restricting Information nor shall any Agent or any of its respective directors, officers, agents or employees be responsible or liable in any way for any decision a Lender Party may make to limit or to not limit its access to Restricting Information.  In particular, none of any Agent or any of its respective directors, officers, agents or employees (i) shall have, and each Agent, on behalf of itself and each of its directors, officers, agents and employees, hereby disclaims, any duty to ascertain or inquire as to whether or not a Lender Party has or has not limited its access to Restricting Information, such Lender Party’s policies or procedures regarding the safeguarding of material, nonpublic information or such Lender Party’s compliance with applicable laws related thereto or (ii) shall have, or incur, any liability to any Loan Party, any Lender Party or any of their respective Affiliates, directors, officers, agents or employees arising out of or relating to any Agent or any of its respective directors, officers, agents or employees providing or not providing Restricting Information to any Lender Party, other than as found by a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of any Agent or any of its respective directors, officers, agents or employees.

 

(c)                                  Each Loan Party agrees that (i) all Communications it provides to any Agent intended for delivery to the Lender Parties whether by posting to the Approved Electronic Platform or otherwise shall be clearly and conspicuously marked “PUBLIC” if such Communications are determined by the Loan Parties in good faith not to contain Restricting Information which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof, (ii) by marking Communications “PUBLIC,” each Loan Party shall be deemed to have authorized the Agents and the Lender Parties to treat such Communications as either publicly available information or not material information (although such Communications shall remain subject to the confidentiality undertakings of Section 9.12(a)) with respect to such Loan Party or its securities for purposes of United States Federal and state securities laws, (iii) all Communications marked “PUBLIC” may be delivered to all Lender Parties and may be made available through a portion of the Approved Electronic Platform designated “Public Side Information” and (iv) the Agents shall be entitled to treat any Communications that are not marked “PUBLIC” as Restricting Information and may post such Communications to a portion of the Approved Electronic Platform not designated “Public Side Information” (and shall not post such Communications to a portion of the Approved Electronic Platform designated “Public Side Information”).  Neither Agent nor any of its respective Affiliates shall be responsible for any statement or other designation by a Loan Party regarding whether a Communication contains or does not contain material non-public information with respect to any of the Loan Parties or their securities nor shall the Agents or any of their respective Affiliates incur any liability to any

 

116

 

Loan Party, any Lender Party or any other Person for any action taken by any Agent or any of its respective Affiliates based upon such statement or designation, including any action as a result of which Restricting Information is provided to a Lender Party that may decide not to take access to Restricting Information.  Nothing in this Section 9.12(c) shall modify or limit a Person’s obligations under Section 9.12 with regard to Communications and the maintenance of the confidentiality of or other treatment of Information.

 

(d)                                 Each Lender Party acknowledges that circumstances may arise that require it to refer to Communications that might contain Restricting Information.  Accordingly, each Lender Party agrees that it will nominate at least one designee to receive Communications (including Restricting Information) on its behalf and identify such designee (including such designee’s contact information) in writing to the Administrative Agent.  Each Lender Party agrees to notify the Administrative Agent from time to time of such Lender Party’s designee’s e-mail address to which notice of the availability of Restricting Information may be sent by electronic transmission.

 

(e)                                  Each Lender Party acknowledges that Communications delivered hereunder and under the other Loan Documents may contain Restricting Information and that such Communications are available to all Lender Parties generally.  Each Lender Party that elects not to take access to Restricting Information does so voluntarily and, by such election, acknowledges and agrees that the Agents and other Lender Parties may have access to Restricting Information that is not available to such electing Lender Party.  Each such electing Lender Party acknowledges the possibility that, due to its election not to take access to Restricting Information, it may not have access to any Communications (including, without being limited to, the items required to be made available to the Administrative Agent in Section 5.03 unless or until such Communications (if any) have been filed or incorporated into documents which have been filed with the Securities and Exchange Commission by the Borrower).  None of the Loan Parties, Agents or any Lender Party with access to Restricting Information shall have any duty to disclose such Restricting Information to such electing Lender Party or to use such Restricting Information on behalf of such electing Lender Party, and shall not be liable for the failure to so disclose or use, such Restricting Information.

 

(f)                                   Sections 9.10(b), (c), (d) and (e) are designed to assist the Agents, the Lender Parties and the Loan Parties, in complying with their respective contractual obligations and applicable law in circumstances where certain Lender Parties express a desire not to receive Restricting Information notwithstanding that certain Communications hereunder or under the other Loan Documents or other information provided to the Lender Parties hereunder or thereunder may contain Restricting Information.  None of any Agent or any of its respective directors, officers, agents or employees warrants or makes any other statement with respect to the adequacy of such provisions to achieve such purpose nor does any Agent or any of its respective directors, officers, agents or employees warrant or make any other statement to the effect that a Loan Party’s or Lender Party’s adherence to such provisions will be sufficient to ensure compliance by such Loan Party or Lender Party with its contractual obligations or its duties under applicable law in respect of Restricting Information and each of the Lender Parties and each Loan Party assumes the risks associated therewith.

 

SECTION 9.13                                 Release of Collateral.  (a)  Upon (i) the sale, lease, transfer or other disposition of any item of Collateral of any Loan Party (including, without limitation, (x) as a result of a sale of the Equity Interests in the Loan Party that owns such Collateral, and (y) any Transfer pursuant to Section 5.02(e)(ii) or (iii)) that is permitted by the terms of the Loan Documents or (ii) any designation of any Borrowing Base Asset as a non-Borrowing Base Asset that is permitted by Section 5.02(e)(iii), then, in either such event, the Collateral Agent will, at the Borrower’s expense, execute and deliver to the applicable Loan Party such documents as such Loan Party may reasonably request to evidence the release of such item of Collateral from the assignment and security interest granted under the Collateral Document in accordance with the terms of the Loan Documents.

 

(b)                                 Upon the latest to occur of (i) the indefeasible payment in full in cash of the Secured Obligations, (ii) the termination in whole of the Commitments and (iii) the termination or expiration of all Letters of Credit, the Liens granted by the Collateral Documents shall terminate and all rights to the Collateral

 

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shall revert to the applicable Loan Party.  Upon any such termination, the Collateral Agent will, at the Borrower’s expense, execute and deliver to the applicable Loan Parties such documents as such Loan Parties shall reasonably request to evidence such termination.

 

SECTION 9.14                                 Patriot Act Notification.  Each Lender and each Agent (for itself and not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Patriot Act”), it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of such Loan Party and other information that will allow such Lender or such Agent, as applicable, to identify such Loan Party in accordance with the Patriot Act.  The Borrower shall, and shall cause each of its Subsidiaries to, provide, to the extent commercially reasonable, such information and take such actions as are reasonably requested by any Agents or any Lenders in order to assist the Administrative Agent and the Lenders in maintaining compliance with the Patriot Act.

 

SECTION 9.15                                 Jurisdiction, Etc.  (a)  Each of the Loan Parties hereby irrevocably and unconditionally agrees that it will not commence any action, litigation or other proceeding of any kind or description, whether in law or equity, whether in contract or in tort or otherwise, arising out of or relating to this Agreement or any of the other Loan Documents to which it is a party, against any Agent, any Lender Party or any other Indemnified Party in any forum other than the courts of the State of New York sitting in New York County, and of the United States District Court of the Southern District of New York, and any appellate court from any thereof and each of the Loan Parties irrevocably and unconditionally submits to the jurisdiction of such courts, and each of the Loan Parties hereby irrevocably and unconditionally agrees that all claims in respect of any such action, litigation or proceeding may be heard and determined in any such New York State court or, to the extent permitted or required by law, in such Federal court.  Each of the Loan Parties agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this agreement shall affect any right that any Agent, any Lender Party or any other Indemnified Party may otherwise have to bring any action or proceeding relating to this Agreement or any of the other Loan Documents to which it is a party in the courts of any jurisdiction in connection with the exercise of any rights under any Loan Document or against any Collateral or the enforcement of any judgment, and each Loan Party hereby submits to the jurisdiction of, and consents to venue in, any such court.

 

(b)                                 Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any of the other Loan Documents to which it is a party in any New York State or Federal court sitting in City, County and State of New York.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

SECTION 9.16                                 Governing Law.  This Agreement and the Notes shall be governed by, and construed in accordance with, the law of the State of New York.

 

SECTION 9.17                                 WAIVER OF JURY TRIAL.  EACH OF THE BORROWER, THE OTHER LOAN PARTIES, THE AGENTS AND THE LENDER PARTIES IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCES, THE LETTERS OF CREDIT OR THE ACTIONS OF ANY AGENT OR ANY LENDER PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

 

SECTION 9.18                                 No Fiduciary Duties.  Each Loan Party agrees that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between the Administrative Agent, the Collateral Agent, any Lender Party or any Affiliate thereof, on the one hand, and such Loan Party, its stockholders or its Affiliates, on the other.  The Loan Parties

 

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agree that the transactions contemplated by the Loan Documents (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions.  Each Loan Party agrees that it has consulted its own legal and financial advisors to the extent it deemed appropriate and that it is responsible for making its own independent judgment with respect to such transactions and the process leading thereto.  Each of the Loan Parties acknowledges that the Administrative Agent, the Collateral Agent, the Lender Parties and their respective Affiliates may have interests in, or may be providing or may in the future provide financial or other services to other parties with interests which a Loan Party may regard as conflicting with its interests and may possess information (whether or not material to the Loan Parties) other than as a result of (x) the Administrative Agent acting as administrative agent hereunder, (y) the Collateral Agent acting as the collateral agent hereunder or (z) the Lender Parties acting as lenders hereunder, that the Administrative Agent, the Collateral Agent or any such Lender Party may not be entitled to share with any Loan Party.  Without prejudice to the foregoing, each of the Loan Parties agrees that the Administrative Agent, the Collateral Agent, the Lender Parties and their respective Affiliates may (a) deal (whether for its own or its customers’ account) in, or advise on, securities of any Person, and (b) accept deposits from, lend money to, act as trustee under indentures of, accept investment banking engagements from and generally engage in any kind of business with other Persons in each case, as if the Administrative Agent were not the Administrative Agent, as if the Collateral Agent were not the Collateral Agent and as if the Lender Parties were not Lender Parties, and without any duty to account therefor to the Loan Parties.  Each of the Loan Parties hereby irrevocably waives, in favor of the Administrative Agent, the Collateral Agent, the Lender Parties and the Arrangers, any conflict of interest which may arise by virtue of the Administrative Agent, the Collateral Agent, the Arrangers and/or the Lender Parties acting in various capacities under the Loan Documents or for other customers of the Administrative Agent, the Collateral Agent, any Arranger or any Lender Party as described in this Section 9.18.

 

SECTION 9.19                                 Acknowledgement and Consent to Bail-In of EEA Financial Institutions.  Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a)                                 the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

 

(b)                                 the effects of any Bail-In Action on any such liability, including, if applicable:

 

(i)                                     a reduction in full or in part or cancellation of any such liability;

 

(ii)                                  a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

 

(iii)                               the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

 

[Balance of page intentionally left blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers or representatives thereunto duly authorized, as of the date first above written.

 

	
 
    	
BORROWER:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FIVE   STAR QUALITY CARE, INC.,
    
	
 
    	
a   Maryland corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title:   Chief Financial Officer and Treasurer
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
GUARANTORS:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FSQ THE PALMS AT FORT MYERS BUSINESS TRUST, a Maryland   business trust
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
FVE MW LLC,
    
	
 
    	
a Maryland limited liability company
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FSQ VILLA AT RIVERWOOD BUSINESS TRUST, 
    a Maryland business trust
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
MORNINGSIDE OF CONCORD, LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
MORNINGSIDE OF SPRINGFIELD, LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
FIVE STAR COVINGTON LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FVE EC LLC,
    
	
 
    	
a Maryland limited liability company
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Richard A. Doyle
    
	
 
    	
 
    	
Name:   Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
ADMINISTRATIVE   AGENT, COLLATERAL AGENT, SWING LINE BANK, AND INITIAL LENDER:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
CITIBANK,   N.A.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Ricardo James
    
	
 
    	
 
    	
Name:   Ricardo James
    
	
 
    	
 
    	
Title:   Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
INITIAL   ISSUING BANK:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
CITIBANK,   N.A.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Ricardo James
    
	
 
    	
 
    	
Name:   Ricardo James
    
	
 
    	
 
    	
Title:   Vice President
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
INITIAL   LENDERS:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ROYAL   BANK OF CANADA,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Sheena Lee
    
	
 
    	
 
    	
Name:   Sheena Lee
    
	
 
    	
 
    	
Title:   Authorized Signatory
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
INITIAL   LENDERS:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
PNC   BANK NATIONAL ASSOCIATION,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Margarita Muzzall
    
	
 
    	
 
    	
Name:   Margarita Muzzall
    
	
 
    	
 
    	
Title:   Vice President
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
INITIAL   LENDERS:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
COMPASS   BANK,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Keely W. McGee
    
	
 
    	
 
    	
Name:   Keely W. McGee
    
	
 
    	
 
    	
Title:   Senior Vice President
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
INITIAL   LENDERS:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
CITIZENS   BANK, N.A.,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Kevin Boyle
    
	
 
    	
 
    	
Name:   Kevin Boyle
    
	
 
    	
 
    	
Title:   Senior Vice President
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

	
 
    	
INITIAL   LENDERS:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
UBS   AG, STAMFORD BRANCH,
    
	
 
    	
as   a Lender
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Houssem Daly
    
	
 
    	
 
    	
Name:   Houssem Daly
    
	
 
    	
 
    	
Title:   Associate Director
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Darlene Arias
    
	
 
    	
 
    	
Name:   Darlene Arias
    
	
 
    	
 
    	
Title:   Director
    

 

FIVE STAR

AMENDED & RESTATED CREDIT AGREEMENT

 

 

SCHEDULE I

 

COMMITMENTS AND APPLICABLE LENDING OFFICES

 

	
Name of Initial
   Lender/
   Initial Issuing
    	
 
    	
Commitments
    	
 
    	
 
    	
 
    	
 
    
	
Bank
    	
 
    	
Revolving Credit
    	
 
    	
Letter of Credit
    	
 
    	
Swing Line
    	
 
    	
Domestic Lending Office
    	
 
    	
Eurodollar Lending Office
    
	
Citibank, N.A.
    	
 
    	
$
    	
25,000,000
    	
 
    	
$
    	
10,000,000
    	
 
    	
$
    	
25,000,000
    	
 
    	
1615 Brett Road OPS III
   New Castle, DE 19720
   Attn: Citi Loan Operations
   Tel: 302-894-6052
   Fax: 212-994-0847
   email: GLOriginationOps@citi.com
    	
 
    	
1615 Brett Road OPS III
   New Castle, DE 19720
   Attn: Citi Loan Operations
   Tel: 302-894-6052
   Fax: 212-994-0847
   email: GLOriginationOps@citi.com
    
	
Royal Bank of Canada
    	
 
    	
$
    	
25,000,000
    	
 
    	
—
    	
 
    	
—
    	
 
    	
Royal Bank of Canada
   Global Loan Administration
   New York Branch
   200 Vesey Street
   New York, NY 10281-8098
   Attn: Ashish Jawa
   Tel: 1-877-332-7455
   Fax: 1-212-428-2372
   email: RBCNewYorkGLA1@rbc.com
    	
 
    	
Royal Bank of Canada
   Global Loan Administration
   New York Branch
   200 Vesey Street
   New York, NY 10281-8098
   Attn: Ashish Jawa
   Tel: 1-877-332-7455
   Fax: 1-212-428-2372
   email: RBCNewYorkGLA1@rbc.com
    
	
PNC Bank, National   Association
    	
 
    	
$
    	
15,000,000
    	
 
    	
—
    	
 
    	
—
    	
 
    	
10851 Mastin Street
   Suite 300
   Overland Park, KS 66210
   Attn: Kim Wetzel
   Tel: 913-253-9280
   Fax: 888-578-2605
   email: kimberly.wetzel@pnc.com
    	
 
    	
10851 Mastin Street
   Suite 300
   Overland Park, KS 66210
   Attn: Kim Wetzel
   Tel: 913-253-9280
   Fax: 888-578-2605
   email: kimberly.wetzel@pnc.com
    
	
Compass Bank
    	
 
    	
$
    	
15,000,000
    	
 
    	
—
    	
 
    	
—
    	
 
    	
8333 Douglas Ave, 2nd Floor
   Dallas, TX 75225
   Attn: Ben David
   Tel: 972-735-3583
   email: Kristi.tadlock@bbva.com
    	
 
    	
8333 Douglas Ave, 2nd Floor
   Dallas, TX 75225
   Attn: Ben David
   Tel: 972-735-3583
   email: Kristi.tadlock@bbva.com
    
														

 

1

 

	
Name of Initial
   Lender/
   Initial Issuing
    	
 
    	
Commitments
    	
 
    	
 
    	
 
    	
 
    
	
Bank
    	
 
    	
Revolving Credit
    	
 
    	
Letter of Credit
    	
 
    	
Swing Line
    	
 
    	
Domestic Lending Office
    	
 
    	
Eurodollar Lending Office
    
	
Citizens Bank, N.A.
    	
 
    	
$
    	
10,000,000
    	
 
    	
—
    	
 
    	
—
    	
 
    	
130 N. 18th Street
   Suite 1310
   Philadelphia, PA 19103
   Attn: Donato Affatato
   Tel: 267-671-1827
   email: donato.affatato@citizensbank.com
    	
 
    	
130 N. 18th Street
   Suite 1310
   Philadelphia, PA 19103
   Attn: Donato Affatato
   Tel: 267-671-1827
   email: donato.affatato@citizensbank.com
    
	
UBS AG, Stamford Branch
    	
 
    	
$
    	
10,000,000
    	
 
    	
—
    	
 
    	
—
    	
 
    	
677 Washington Blvd
   Stamford, CT 06901
   Attn: Loan Administration Team
   Fax: 203-719-3888
   email: UBSAgency@ubs.com
    	
 
    	
677 Washington Blvd
   Stamford, CT 06901
   Attn: Loan Administration Team
   Fax: 203-719-3888
   email: UBSAgency@ubs.com
    
	
Totals
    	
 
    	
$
    	
100,000,000
    	
 
    	
$
    	
10,000,000
    	
 
    	
$
    	
25,000,000
    	
 
    	
 
    	
 
    	
 
    
														

 

2

 

SCHEDULE II
 BORROWING BASE ASSETS*

 

	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Beds in Use†
    	
 
    	
Licensed Beds‡
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Trade Name:
    	
 
    	
Address:
    	
 
    	
Total
   Units
   **
    	
 
    	
No. of
   IL
   beds
    	
 
    	
No. of
   AL
   beds
    	
 
    	
No. of
   ALZ
   beds
    	
 
    	
No.
   of IL
   beds
    	
 
    	
No. of
   AL
   beds
    	
 
    	
No.
   of
   ALZ
   beds
    	
 
    	
Total
   Bed
   Capacity§
    	
 
    
	
1
    	
 
    	
Palms of Fort   Myers
    	
 
    	
2674 Winkler Avenue
   Fort Myers, FL, 33901
    	
 
    	
218
    	
 
    	
143
    	
 
    	
49
    	
 
    	
26
    	
 
    	
149
    	
 
    	
80
    	
 
    	
—
    	
 
    	
229
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
2
    	
 
    	
Rosewalk Commons Retirement Community
    	
 
    	
250 Shenandoah Drive
   Lafayette, IN, 47905
    	
 
    	
109
    	
 
    	
22
    	
 
    	
87
    	
 
    	
 
    	
 
    	
22
    	
 
    	
87
    	
 
    	
—
    	
 
    	
109
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
3
    	
 
    	
Riverwalk Commons
    	
 
    	
7235 Riverwalk Way
   North, Noblesville, IN
   46062
    	
 
    	
151
    	
 
    	
54
    	
 
    	
75
    	
 
    	
22
    	
 
    	
54
    	
 
    	
75
    	
 
    	
22
    	
 
    	
151
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
4
    	
 
    	
Villa at Riverwood
    	
 
    	
No. One Pratt Place
   Florissant, MO 63031
    	
 
    	
110
    	
 
    	
110
    	
 
    	
 
    	
 
    	
 
    	
 
    	
—
    	
 
    	
111
    	
 
    	
—
    	
 
    	
111
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
5
    	
 
    	
Fox Hollow Senior Living Community
    	
 
    	
190 Fox Hollow Road
   Pinehurst, NC 28374
    	
 
    	
77
    	
 
    	
 
    	
 
    	
60
    	
 
    	
17
    	
 
    	
—
    	
 
    	
79
    	
††
    	
16
    	
 
    	
79
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
6
    	
 
    	
Washington Township Senior Living
    	
 
    	
600 Medical Center Dr.
   Sewell, NJ 08080
    	
 
    	
103
    	
 
    	
 
    	
 
    	
103
    	
 
    	
 
    	
 
    	
—
    	
 
    	
103
    	
 
    	
—
    	
 
    	
103
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
7
    	
 
    	
Huntington Place Retirement (inclusive of The   Huntington, Huntington Place Memory Care 1, Huntington Place Memory Care 2,   and Huntington Place Memory Care 3)
    	
 
    	
3801 North Wright Road,
   Janesville, WI 53546
    	
 
    	
127
    	
 
    	
35
    	
 
    	
48
    	
 
    	
44
    	
 
    	
35
    	
 
    	
48
    	
 
    	
44
    	
 
    	
127
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
8
    	
 
    	
Covington Commons
    	
 
    	
2601 Covington
   Commons Drive,
   Fort Wayne, IN 46804
    	
 
    	
154
    	
 
    	
48
    	
 
    	
106
    	
 
    	
 
    	
 
    	
48
    	
 
    	
106
    	
 
    	
—
    	
 
    	
154
    	
 
    

 

*  Facilities listed in items 1-7 are “Existing Borrowing Base Assets,” and facilities listed in items 8-10 are “New Borrowing Base Assets.”

 

†  As of February 13, 2017.

 

‡  As of December 31, 2016.

 

§  As of December 31, 2016.

 

**  As of February 13, 2017.

 

††  As provided on the facility’s license, the licensed bed capacity reflected in the “AL beds” column includes the number of Alzheimer’s/Dementia special care unit beds reflected in the “ALZ beds” column.

 

1

 

	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Beds in Use†
    	
 
    	
Licensed Beds‡
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Trade Name:
    	
 
    	
Address:
    	
 
    	
Total
   Units
   **
    	
 
    	
No. of
   IL
   beds
    	
 
    	
No. of
   AL
   beds
    	
 
    	
No. of
   ALZ
   beds
    	
 
    	
No.
   of IL
   beds
    	
 
    	
No. of
   AL
   beds
    	
 
    	
No.
   of
   ALZ
   beds
    	
 
    	
Total
   Bed
   Capacity§
    	
 
    
	
9
    	
 
    	
Morningside of Springfield
    	
 
    	
205 Westgate Drive
   Springfield, TN 37172
    	
 
    	
54
    	
 
    	
7
    	
 
    	
47
    	
 
    	
 
    	
 
    	
7
    	
 
    	
48
    	
 
    	
0
    	
 
    	
55
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
10
    	
 
    	
Legacy Heights‡‡
    	
 
    	
190 Fox Hollow Road
   Pinehurst, NC 28374
    	
 
    	
116
    	
 
    	
 
    	
 
    	
64
    	
 
    	
52
    	
 
    	
0
    	
 
    	
60
    	
 
    	
56
    	
 
    	
116
    	
 
    

 

‡‡  Pending Borrowing Base Asset.

 

2

 

Schedule 4.01(f)

Material Litigation

 

None.

 

 

EXHIBIT A to the

CREDIT AGREEMENT

 

FORM OF NOTE

 

PROMISSORY NOTE

 

	
$                   
    	
 
    	
Dated:                         ,        
    

 

FOR VALUE RECEIVED, the undersigned, FIVE STAR QUALITY CARE, INC., a Maryland corporation (the “Borrower”), HEREBY PROMISES TO PAY                           (the “Lender”) for the account of its Applicable Lending Office (as defined in the Credit Agreement referred to below) the aggregate principal amount of the Revolving Credit Advances, the Letter of Credit Advances and the Swing Line Advances (each as defined below) owing to the Lender by the Borrower pursuant to the Amended and Restated Credit Agreement dated as of February 24, 2017 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms not otherwise defined herein shall have their respective meanings set forth in the Credit Agreement) among the Borrower, the Lender, certain other Lender parties party thereto, the Guarantors party thereto, Citibank, N.A., as Collateral Agent and as Administrative Agent for the Lender and such other Lender Parties, and the Arrangers party thereto, on the Termination Date.

 

The Borrower promises to pay to the Lender interest on the unpaid principal amount of each Revolving Credit Advance, Letter of Credit Advance and Swing Line Advance from the date of such Revolving Credit Advance, Letter of Credit Advance or Swing Line Advance, as the case may be, until such principal amount is paid in full, at such interest rates, and payable at such times, as are specified in the Credit Agreement.

 

Both principal and interest are payable in lawful money of the United States of America to Citibank, N.A., as Administrative Agent, at 1615 Brett Road OPS III, New Castle, DE 19720, Attention:  Bank Loan Syndications Department, in same day funds.  Each Revolving Credit Advance, Letter of Credit Advance and Swing Line Advance owing to the Lender by the Borrower and the maturity thereof, and all payments made on account of principal thereof, shall be recorded by the Lender and, prior to any transfer hereof, endorsed on the grid attached hereto, which is part of this Promissory Note; provided, however, that the failure of the Lender to make any such recordation or endorsement shall not affect the Obligations of the Borrower under this Promissory Note.

 

This Promissory Note is one of the Notes referred to in, and is entitled to the benefits of, the Credit Agreement.  The Credit Agreement, among other things, (a) provides for the making of advances (variously, the “Revolving Credit Advances”, “Letter of Credit Advances” or the “Swing Line Advances”) by the Lender to or for the benefit of the Borrower from time to time in an aggregate amount not to exceed at any time outstanding the U.S. dollar amount first above mentioned, the indebtedness of the Borrower resulting from each such Revolving Credit Advance, Letter of Credit Advance and Swing Line Advance being evidenced by this Promissory Note, and (b) contains provisions for acceleration of the maturity hereof upon the happening of an Event of Default and also for prepayments on account of principal hereof prior to the Termination Date upon the terms and conditions therein specified.

 

FIVE STAR

PROMISSORY NOTE

 

 

The obligations of the Borrower under this Promissory Note and the other Loan Documents, and the obligations of the other Loan Parties under the Loan Documents, are secured by the Collateral as provided in the Loan Documents.

 

FIVE STAR

PROMISSORY NOTE

 

 

This Promissory Note shall be governed by, and construed in accordance with, the laws of the State of New York.

 

	
 
    	
FIVE   STAR QUALITY CARE, INC.
    
	
 
    	
a Maryland corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

FIVE STAR

PROMISSORY NOTE

 

 

ADVANCES AND 
 PAYMENTS OF PRINCIPAL

 

	
Date
    	
 
    	
Amount of
   Advance
    	
 
    	
Amount of
   Principal Paid
   or Prepaid
    	
 
    	
Unpaid
   Principal
   Balance
    	
 
    	
Notation
   Made By
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

FIVE STAR

PROMISSORY NOTE

 

 

EXHIBIT B to the

CREDIT AGREEMENT

 

FORM OF NOTICE 
 OF BORROWING

 

NOTICE OF [SWING LINE] BORROWING

 

                              ,         

 

Citibank, N.A.

as Administrative Agent

under the Credit Agreement

referred to below

1615 Brett Road OPS III

New Castle, DE 19720

Attention:  Bank Loan Syndications Department

 

Ladies and Gentlemen:

 

The undersigned, FIVE STAR QUALITY CARE, INC., a Maryland corporation, refers to the Amended and Restated Credit Agreement dated as of February 24, 2017  (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms not otherwise defined herein shall have their respective meanings set forth in the Credit Agreement), among the undersigned, Five Star Quality Care, Inc.,  the Guarantors party thereto, the Lender Parties party thereto, Citibank, N.A., as Collateral Agent and as Administrative Agent for the Lender Parties and the Arrangers party thereto, and hereby gives you notice, irrevocably, pursuant to Section 2.02 of the Credit Agreement that the undersigned hereby requests a Borrowing under the Credit Agreement, and in that connection sets forth below the information relating to such Borrowing (the “Proposed Borrowing”) as required by Section [2.02(a)][2.02(b)] of the Credit Agreement:

 

(i)                                     The Business Day of the Proposed Borrowing is                      ,     .

 

(ii)                                  The Facility under which the Proposed Borrowing is requested is the [Revolving Credit][Swing Line] Facility.

 

(iii)                               The Type of Advances comprising the Proposed Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].

 

(iv)                              The aggregate amount of the Proposed Borrowing is [$          ].

 

(v)                                 [The initial Interest Period for each Eurodollar Rate Advance made as part of the Proposed Borrowing is            month[s].]  [The maturity of such Borrowing is        .]

 

The undersigned hereby certifies that the following statements are true on the date hereof, and will be true on the date of the Proposed Borrowing:

 

 

(A)            The representations and warranties contained in each Loan Document are true and correct on and as of the date of the Proposed Borrowing, before and after giving effect to (1) such Proposed Borrowing and (2) the application of the proceeds therefrom, as though made on and as of the date of the Proposed Borrowing;

 

(B)            No Default or Event of Default has occurred and is continuing, or would result from (1) such Proposed Borrowing or (2) from the application of the proceeds therefrom; and

 

(C)            (1) the Facility Available Amount equals or exceeds the Facility Exposure that will be outstanding after giving effect to such Advance, issuance or renewal, respectively, and (2) before and after giving effect to such Advance, issuance or renewal, the Borrower shall be in compliance with the covenants contained in Section 5.04 of the Credit Agreement.

 

Attached hereto is a Borrowing Base Certificate for the Proposed Borrowing dated the date of such Proposed Borrowing demonstrating that the Facility Available Amount as of such date (calculated on a pro forma basis after giving effect to such proposed borrowing) will be greater than or equal to the Facility Exposure.

 

Delivery of an executed counterpart of this Notice of Borrowing by telecopier or e-mail (which e-mail shall include an attachment in PDF format or similar format containing the legible signature of the undersigned) shall be effective as delivery of an original executed counterpart of this Notice of Borrowing.

 

	
 
    	
FIVE STAR QUALITY   CARE, INC.
    
	
 
    	
a Maryland corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

 

EXHIBIT C to the

CREDIT AGREEMENT

 

FORM OF

GUARANTY SUPPLEMENT

 

GUARANTY SUPPLEMENT

 

                           ,         

 

Citibank, N.A.

as Administrative Agent

under the Credit Agreement

referred to below

1615 Brett Road OPS III

New Castle, DE 19720

Attention:  Bank Loan Syndications Department

 

Amended and Restated Credit Agreement dated as of February 24, 2017 (as in effect on the date hereof and as it may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Five Star Quality Care, Inc., as Borrower the Guarantors party thereto, the Lender Parties party thereto, Citibank, N.A., as Collateral Agent and as Administrative Agent for the Lender Parties and the Arrangers party thereto.

 

Ladies and Gentlemen:

 

Reference is made to the above-captioned Credit Agreement and to the Guaranty set forth in Article VII thereof (such Guaranty, as in effect on the date hereof and as it may hereafter be amended, supplemented or otherwise modified from time to time, together with this Guaranty Supplement, being the “Guaranty”).  Capitalized terms not otherwise defined herein shall have their respective meanings set forth in the Credit Agreement.

 

Section 1.                                           Guaranty; Limitation of Liability.  (a)  The undersigned hereby absolutely, unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all Obligations of the Borrower and each other Loan Party now or hereafter existing under or in respect of the Loan Documents (including, without limitation, any extensions, modifications, substitutions, amendments or renewals of any or all of the foregoing Obligations), whether direct or indirect, absolute or contingent, and whether for principal, interest, premiums, fees, indemnities, contract causes of action, costs, expenses or otherwise (such Obligations being the “Guaranteed Obligations”), and agrees to pay any and all expenses (including, without limitation, fees and expenses of counsel) incurred by the Administrative Agent or any other Secured Party in enforcing any rights under this Guaranty Supplement, the Guaranty, the Credit Agreement or any other Loan Document.  Without limiting the generality of the foregoing, the undersigned’s liability shall extend to all amounts that constitute part of the Guaranteed Obligations and would be owed by any other Loan Party to any Secured Party under or in respect of the Loan Documents but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving such other Loan Party.

 

 

(b)                                 The undersigned, and by its acceptance of the benefits of this Guaranty Supplement, the Administrative Agent and each other Secured Party, hereby confirms that it is the intention of all such Persons that this Guaranty Supplement, the Guaranty and the Obligations of the undersigned hereunder and thereunder not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to the extent applicable to this Guaranty Supplement, the Guaranty and the Obligations of the undersigned hereunder and thereunder.  To effectuate the foregoing intention, the Administrative Agent, the other Secured Parties and the undersigned hereby irrevocably agree that the Obligations of the undersigned under this Guaranty Supplement and the Guaranty at any time shall be limited to the maximum amount as will result in the Obligations of the undersigned under this Guaranty Supplement and the Guaranty not constituting a fraudulent transfer or conveyance.

 

(c)                                  The undersigned hereby unconditionally and irrevocably agrees that in the event any payment shall be required to be made to any Secured Party under this Guaranty Supplement, the Guaranty or any other guaranty, the undersigned will contribute, to the maximum extent permitted by law, such amounts to each other Guarantor and each other guarantor so as to maximize the aggregate amount paid to the Secured Parties under or in respect of the Loan Documents.

 

Section 2.                                           Obligations Under the Guaranty.  The undersigned hereby agrees, as of the date first above written, to be bound as a Guarantor by all of the terms and conditions of the Credit Agreement and the Guaranty to the same extent as each of the other Guarantors thereunder.  The undersigned further agrees, as of the date first above written, that each reference in the Credit Agreement to an “Additional Guarantor”, a “Loan Party” or a “Guarantor” shall also mean and be a reference to the undersigned, and each reference in any other Loan Document to a “Guarantor” or a “Loan Party” shall also mean and be a reference to the undersigned.

 

Section 3.                                           Representations and Warranties.  The undersigned hereby makes each representation and warranty set forth in Section 4.01 of the Credit Agreement to the same extent as each other Guarantor; provided, however, that, to the extent there have been any changes in factual matters related to the addition of the undersigned as a Guarantor or the addition of any Asset owned by the undersigned as a Borrowing Base Asset warranting updated Schedules to the Disclosure Letter (so long as such changes in factual matters shall in no event comprise a Default or an Event of Default under the Credit Agreement), such updated Schedules are attached as Exhibit A hereto, and references in such representations and warranties to Schedules to the Disclosure Letter shall be deemed to refer to such Schedules as so updated.

 

Section 4.                                           Delivery by Telecopier.  Delivery of an executed counterpart of a signature page to this Guaranty Supplement by telecopier or e-mail (which e-mail shall include an attachment in PDF format or similar format containing the legible signature of the undersigned) shall be effective as delivery of an original executed counterpart of this Guaranty Supplement.

 

Section 5.                                           Governing Law; Jurisdiction; Waiver of Jury Trial, Etc.  (a)  This Guaranty Supplement shall be governed by, and construed in accordance with, the laws of the State of New York.

 

(b)                                 The undersigned hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or any federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Guaranty Supplement, the Guaranty, the Credit Agreement or any of the other Loan Documents to which it is or is to be a party, or for recognition or enforcement of any judgment, and the undersigned hereby irrevocably and unconditionally agrees that all

 

 

claims in respect of any such action or proceeding may be heard and determined in any such New York State court or, to the extent permitted by law, in such federal court.  The undersigned agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Guaranty Supplement or the Guaranty or the Credit Agreement or any other Loan Document shall affect any right that any party may otherwise have to bring any action or proceeding relating to this Guaranty Supplement, the Credit Agreement, the Guaranty thereunder or any of the other Loan Documents to which it is or is to be a party in the courts of any other jurisdiction.

 

(c)                                  The undersigned irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Guaranty Supplement, the Credit Agreement, the Guaranty or any of the other Loan Documents to which it is or is to be a party in any New York State or federal court.  The undersigned hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such suit, action or proceeding in any such court.

 

(d)                                 THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

 

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
FSQ   THE PALMS AT FORT MYERS BUSINESS TRUST, 
    a Maryland business   trust
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FVE MW   LLC,
    
	
 
    	
a Maryland limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FSQ   VILLA AT RIVERWOOD BUSINESS TRUST, 
    a Maryland business   trust
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
MORNINGSIDE   OF CONCORD, LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
MORNINGSIDE   OF SPRINGFIELD, LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    

 

 

FIVE STAR

GUARANTY SUPPLEMENT

 

 

	
 
    	
FIVE   STAR COVINGTON LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FVE EC   LLC,
    
	
 
    	
a Maryland limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    

 

FIVE STAR

GUARANTY SUPPLEMENT

 

 

EXHIBIT D to the

CREDIT AGREEMENT

 

FORM OF

ASSIGNMENT AND ACCEPTANCE

 

ASSIGNMENT AND ACCEPTANCE

 

Reference is made to the Amended and Restated Credit Agreement dated as of February 24, 2017 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms not otherwise defined herein shall have their respective meanings set forth in the Credit Agreement), among Five Star Quality Care, Inc., a Maryland Corporation, as Borrower, the Guarantors party thereto, the Lender Parties party thereto, Citibank, N.A., as Collateral Agent and as Administrative Agent for the Lender Parties and the Arrangers party thereto.

 

Each “Assignor” referred to on Schedule 1 hereto (each, an “Assignor”) and each “Assignee” referred to on Schedule 1 hereto (each, an “Assignee”) agrees severally with respect to all information relating to it and its assignment hereunder and on Schedule 1 hereto as follows:

 

1.                                      Such Assignor hereby sells and assigns, without recourse except as to the representations and warranties made by it herein, to such Assignee, and such Assignee hereby purchases and assumes from such Assignor, an interest in and to such Assignor’s rights and obligations under the Credit Agreement as of the date hereof equal to the percentage interest specified on Schedule 1 hereto of all outstanding rights and obligations under the Credit Agreement Facilities specified on Schedule 1 hereto.  After giving effect to such sale and assignment, such Assignee’s Commitments and the amount of the Advances owing to such Assignee will be as set forth on Schedule 1 hereto.

 

2.                                      Such Assignor (a) represents and warrants that its name set forth on Schedule 1 hereto is its legal name, that it is the legal and beneficial owner of the interest or interests being assigned by it hereunder and that such interest or interests are free and clear of any adverse claim; (b) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with any Loan Document or the execution, legality, validity, enforceability, genuineness, sufficiency or value of, or the perfection or priority of any lien or security interest created or purported to be created under or in connection with, any Loan Document or any other instrument or document furnished pursuant thereto; (c) makes no representation or warranty and assumes no responsibility with respect to the financial condition of any Loan Party or the performance or observance by any Loan Party of any of its obligations under any Loan Document or any other instrument or document furnished pursuant thereto; and (d) attaches the Note or Notes (if any) held by such Assignor and requests that the Administrative Agent exchange such Note or Notes for a new Note or Notes payable to the order of such Assignee in an amount equal to the Commitments assumed by such Assignee pursuant hereto or new Notes payable to the order of such Assignee in an amount equal to the Commitments assumed by such Assignee pursuant hereto and such Assignor in an amount equal to the Commitments retained by such Assignor under the Credit Agreement, respectively, as specified on Schedule 1 hereto.

 

3.                                      Such Assignee (a) represents and warrants that it is legally authorized to enter into this Assignment and Acceptance; (b) confirms that it has received a copy of the Credit Agreement, together with copies of the financial statements referred to in Section 4.01 thereof and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to

 

 

enter into this Assignment and Acceptance; (c) agrees that it will, independently and without reliance upon any Agent, any Assignor or any other Lender Party and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (d) represents and warrants that its name set forth on Schedule 1 hereto is its legal name; (e) confirms that it is an Eligible Assignee; (f) appoints and authorizes each Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Loan Documents as are delegated to such Agent by the terms thereof, together with such powers and discretion as are reasonably incidental thereto; (g) agrees that it will perform in accordance with their terms all of the obligations that by the terms of the Credit Agreement are required to be performed by it as a Lender Party; and (h) attaches any U.S. Internal Revenue Service forms required under Section 2.12 of the Credit Agreement.

 

4.                                      Following the execution of this Assignment and Acceptance, it will be delivered to the Administrative Agent for acceptance and recording by the Administrative Agent.  The effective date for this Assignment and Acceptance (the “Effective Date”) shall be the date of acceptance hereof by the Administrative Agent, unless otherwise specified on Schedule 1 hereto.

 

5.                                      Upon such acceptance by the Administrative Agent and, if applicable, the Borrower and recording by the Administrative Agent, as of the Effective Date, (a) such Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender Party thereunder and (b) such Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Credit Agreement (other than its rights and obligations under the Loan Documents that are specified under the terms of such Loan Documents to survive the payment in full of the Obligations of the Loan Parties under the Loan Documents to the extent any claim thereunder relates to an event arising prior to the Effective Date of this Assignment and Acceptance) and, if this Assignment and Acceptance covers all of the remaining portion of the rights and obligations of such Assignor under the Credit Agreement, such Assignor shall cease to be a party thereto.

 

6.                                      Upon such acceptance by the Administrative Agent and, if applicable, the Borrower and recording by the Administrative Agent, from and after the Effective Date, the Administrative Agent shall make all payments under the Credit Agreement and the Notes in respect of the interest assigned hereby (including, without limitation, all payments of principal, interest and commitment fees with respect thereto) to such Assignee.  Such Assignor and such Assignee shall make all appropriate adjustments in payments under the Credit Agreement and the Notes for periods prior to the Effective Date directly between themselves.

 

7.                                      This Assignment and Acceptance shall be governed by, and construed in accordance with, the laws of the State of New York.

 

8.                                      This Assignment and Acceptance may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of Schedule 1 to this Assignment and Acceptance by telecopier or e-mail (which e-mail shall include an attachment in PDF format or similar format containing the legible signature of the person executing this Assignment and Acceptance) shall be effective as delivery of an original executed counterpart of this Assignment and Acceptance.

 

 

IN WITNESS WHEREOF, each Assignor and each Assignee have caused Schedule 1 to this Assignment and Acceptance to be executed by their officers thereunto duly authorized as of the date specified thereon.

 

 

SCHEDULE 1

to

ASSIGNMENT AND ACCEPTANCE

 

	
ASSIGNORS:
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Revolving   Credit Facility
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Percentage   interest assigned
    	
 
    	
 
    	
%
    	
 
    	
%
    	
 
    	
%
    	
 
    	
%
    	
 
    	
%
    
	
Revolving Credit   Commitment assigned
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
Aggregate   outstanding principal amount of Revolving Credit Advances assigned
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
Principal amount   of Note payable to Assignor
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
Letter   of Credit Facility
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Letter of Credit   Commitment assigned
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
Letter of Credit   Commitment retained
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
ASSIGNEES:
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Revolving   Credit Facility
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Percentage   interest assumed
    	
 
    	
 
    	
%
    	
 
    	
%
    	
 
    	
%
    	
 
    	
%
    	
 
    	
%
    
	
Revolving Credit   Commitment assumed
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
Aggregate   outstanding principal amount of Revolving Credit Advances assumed
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
Principal amount   of Note payable to Assignee
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    
	
Letter   of Credit Facility
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Letter of Credit   Commitment assumed
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    

 

 

Effective Date (if other than date of acceptance by Administrative Agent):

(1)                      ,        

 

	
 
    	
Assignors
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
                                                                             ,   as Assignor
    
	
 
    	
[Type or print legal name of Assignor]
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
Dated:                              ,      
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
                                                                             ,   as Assignor
    
	
 
    	
[Type or print legal name of Assignor]
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
Dated:                              ,      
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
                                                                             ,   as Assignor
    
	
 
    	
[Type or print legal name of Assignor]
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
Dated:                              ,      
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
                                                                             ,   as Assignor
    
	
 
    	
[Type or print legal name of Assignor]
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
Dated:                              ,      
    

 

(1)                                 This date should be no earlier than five Business Days after the delivery of this Assignment and Acceptance to the Administrative Agent and, if applicable, the Borrower.

 

 

	
 
    	
Assignees
    
	
 
    	
 
    
	
 
    	
                                                                             ,   as Assignee
    
	
 
    	
[Type or print legal name of Assignee]
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
E-mail address for   notices:
    
	
 
    	
 
    
	
 
    	
Dated:                              ,      
    
	
 
    	
 
    
	
 
    	
Domestic Lending   Office:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Eurodollar Lending   Office:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
                                                                             ,   as Assignee
    
	
 
    	
[Type or print legal name of Assignee]
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
E-mail address for   notices:
    
	
 
    	
 
    
	
 
    	
Dated:                              ,      
    
	
 
    	
 
    
	
 
    	
Domestic Lending Office:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Eurodollar Lending   Office:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
                                                                             ,   as Assignee
    
	
 
    	
[Type or print legal name of Assignee]
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
E-mail address for   notices:
    
	
 
    	
 
    
	
 
    	
Dated:                            ,      
    
	
 
    	
 
    
	
 
    	
Domestic Lending   Office:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Eurodollar Lending   Office:
    

 

 

	
 
    	
                                                                             ,   as Assignee
    
	
 
    	
[Type or print legal name of Assignee]
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
E-mail address for   notices:
    
	
 
    	
 
    
	
 
    	
Dated:                              ,      
    
	
 
    	
 
    
	
 
    	
Domestic Lending   Office:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Eurodollar Lending   Office:
    

 

 

Accepted [and Approved] this         

day of                         ,          

 

CITIBANK, N.A.,

as Administrative Agent

 

 

	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

 

Approved this      day

of                     , 2017

 

 

FIVE STAR QUALITY CARE, INC.,

a Maryland corporation

 

 

	
By:
    	
 
    	
 
    
	
 
    	
Name: Richard A. Doyle
    	
 
    
	
 
    	
Title: Chief Financial   Officer and Treasurer
    	
 
    

 

FIVE STAR
 ASSIGNMENT AND ACCEPTANCE

 

 

EXHIBIT E-1

 

 

EXHIBIT E-2

 

Form of Opinion of Local Counsel
 with Respect to Real Estate Matters

 

[FORM OF OPINION OF LOCAL COUNSEL
 WITH RESPECT TO REAL ESTATE MATTERS]

 

                        , 2017

 

To:                             The Secured Parties under the Credit Agreement
 referred to below and to Citibank, N.A.,

as Administrative and Collateral Agent under the

Credit Agreement referred to below

 

Re:  Five Star Quality Care, Inc.

 

Ladies and Gentlemen:

 

We have acted as special [name of State] (the “State”) counsel to Five Star Quality Care, Inc., a Maryland corporation (“Borrower”), and [applicable Guarantor] a [           ] [                   ] (“Grantor”) in connection with the execution and delivery of the [Mortgage/Deed of Trust/Deed to Secure Debt] referenced below pursuant to that certain Amended and Restated Credit Agreement dated as of [                   ], 2017 (the “Credit Agreement”) by and among Borrower, the Guarantors identified therein, the Secured Parties (as defined therein), and Citibank, N.A., as collateral agent (in such capacity, “Collateral Agent”) and as administrative agent (in such capacity, “Administrative Agent”) for the Secured Parties.  This opinion is rendered at the request of Borrower pursuant to Section 3.01(a) of the Credit Agreement.  Capitalized terms used herein and not otherwise defined shall have the respective meanings ascribed to such terms in the [Mortgage/Deed of Trust/Deed to Secure Debt], or if not defined therein, in the Credit Agreement.

 

In our capacity as such counsel, we have examined originals, or copies identified to our satisfaction as being true copies, of such records, documents or other instruments as in our judgment are necessary or appropriate to enable us to render the opinions expressed below, including such corporate records and documents of Grantor and such certificates of public officials and officers of Grantor as we have deemed necessary or appropriate for purposes of this opinion.  These records, documents and instruments also included execution copies or counterparts of the following documents (collectively, the “Subject Documents”):

 

1.                                      The Credit Agreement; [and]

 

2.                                      The [Amended and Restated][Mortgage/Deed of Trust/Deed to Secure Debt], Assignment of Rents and Leases, Security Agreement and Fixture Filing dated as of        , 2017 from Grantor, as [mortgagor/grantor], to [                , as trustee (“Trustee”), for the benefit of] Collateral Agent, as [mortgagee/beneficiary] (the “[Mortgage/Deed of Trust/Deed to Secure Debt]”), encumbering the “Mortgaged Property” described therein[.][; and]

 

3.                                      [** FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA:  The Uniform Commercial Code Fixture Filing naming Grantor as debtor and Collateral Agent as secured party, relating to the Mortgaged Property (the “Fixture Filing”).**]

 

 

Assumptions

 

In rendering this opinion we have assumed, without having made any independent investigation of the facts, except with respect to matters of State and federal law on which we have opined below, the following:

 

(i)                                     the genuineness of all signatures, the authenticity of all documents submitted to us as originals and the conformity with originals of all documents submitted to us as copies;

 

(ii)                                  to the extent that the obligations of Grantor may be dependent upon such matters, other than with respect to Grantor, that each party to the agreements and contracts referred to herein is duly formed, validly existing and in good standing under the laws of its jurisdiction of formation; that each such other party has the requisite corporate or other organizational power and authority to perform its obligations under such agreements and contracts, as applicable; and that such agreements and contracts have been duly authorized, executed and delivered by, and each of them constitutes the legally valid and binding obligations of, such other parties, as applicable, enforceable against such other parties in accordance with their respective terms;

 

(iii)                               that Grantor is duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation;

 

(iv)                              that Grantor has the requisite corporate power and authority to enter into and perform its obligations under the Subject Documents to which it is a party;

 

(v)                                 the due authorization, execution and delivery by Grantor of the Subject Documents to which Grantor is a party;

 

(vi)                              that a part or all of the loan proceeds to be advanced pursuant to the Credit Agreement will have been advanced on or before the date hereof;

 

(vii)                           that all material factual matters, including without limitation, representations and warranties, contained in the Subject Documents, are true and correct as set forth therein;

 

(viii)                        that Grantor, at the time of recordation of the [Mortgage/Deed of Trust/Deed to Secure Debt][**FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA:  and filing of the Fixture Filing**], held an interest of record in the real property portions of the Mortgaged Property owned by Grantor; [and]

 

(ix)                              [**FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA:  that the portions of the Fixtures (as defined below) that are or are to become fixtures with respect to the Mortgaged Property are and will be located on the Mortgaged Property; and**]

 

(x)                                 that the Subject Documents will be governed by and construed in accordance with the internal laws of the State, notwithstanding the provisions of the Subject Documents to the contrary.

 

2

 

Opinions

 

On the basis of such examination, our reliance upon the assumptions contained herein and our consideration of those questions of law we considered relevant, and subject to the limitations and qualifications in this opinion, we are of the opinion that:

 

1.              The [Mortgage/Deed of Trust/Deed to Secure Debt] constitutes the legal, valid and binding obligation of Grantor, enforceable against Grantor in accordance with its terms.

 

2.              The execution and delivery of the Subject Documents, the performance by Grantor of its obligations thereunder and the compliance with the terms and conditions thereof by Grantor are not in contravention of or in conflict with any law, rule or regulation of the State applicable to Grantor.

 

3.              The execution and delivery by [name of Guarantor] of each Loan Document to which it is a party do not, and the performance by [name of Guarantor] of its obligations thereunder and the transactions contemplated by such Loan Documents do not violate any [State] law, rule or regulation applicable to guarantors or grantors generally or applicable to [name of Guarantor].

 

4.              No authorization or approval or other action by, and no notice to or filing with, any [State] governmental authority or regulatory body is required for (a) the due execution, delivery or performance by [name of Guarantor] of any Loan Document to which it is a party or the consummation of the transactions contemplated by any such Loan Document, (b) the grant by [name of Guarantor] of the Liens granted by it pursuant to the Collateral Documents to which it is a party, or (c) the perfection or maintenance of the Liens created under such Collateral Documents (including the first priority nature thereof), or (d) except for (i) the exercise of any remedies requiring prior court approval, (ii) the filings or other actions referred to in paragraph[s]    herein or (iii) the approval of [State] licensing agencies or permitting boards, the exercise by the Administrative Agent, the Collateral Agent or any Secured Party of its rights under any Loan Document to which [name of Guarantor] is a party or the remedies in respect of the Collateral pursuant to any such Collateral Document.

 

5.              The [Mortgage/Deed of Trust/Deed to Secure Debt] (including the acknowledgement, attestation, seal and witness requirements) is in appropriate form for recordation in the State.

 

6.              The [Mortgage/Deed of Trust/Deed to Secure Debt] is in proper form sufficient to create a valid [mortgage lien/deed of trust lien/security title] in favor of Collateral Agent on, and to vest [Trustee and] Collateral Agent with power of sale in, such of the Mortgaged Property described therein that constitutes real property (including fixtures, to the extent the same constitute real property).  The recordation of the [Mortgage/Deed of Trust/Deed to Secure Debt] in the [** NAME APPROPRIATE COUNTY RECORDING OFFICE**] is the only recordation, filing or registration necessary to perfect the [lien on/security title in] the Mortgaged Property created by the [Mortgage/Deed of Trust/Deed to Secure Debt] [** FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA:  , except for the filing with the ** NAME APPROPRIATE COUNTY RECORDING OFFICE** of the Fixture Filing regarding that portion of the Mortgaged Property constituting fixtures**].  Upon recordation of the [Mortgage/Deed of Trust/Deed to Secure Debt] in the [** NAME APPROPRIATE COUNTY RECORDING OFFICE**], [Trustee/Collateral Agent] will have a valid and perfected [mortgage lien on/deed of trust lien on/security title to] the Mortgaged Property described therein.  No other 

 

3

 

recordation, filing, re-recordation or re-filing is necessary in order to perfect or to maintain the priority of the [lien/security title] created by the [Mortgage/Deed of Trust/Deed to Secure Debt].

 

7.              The real property descriptions attached to the [Mortgage/Deed of Trust] [FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA: and the Fixture Filing] are in form legally sufficient for the purpose of subjecting that portion of the Mortgaged Property that constitutes real property to the lien evidenced by the [Mortgage/Deed of Trust/Deed to Secure Debt][** FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA:  and the Fixture Filing**].

 

8.              [**EXCLUDING MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA AND LOUISIANA** The [Mortgage/Deed of Trust] is in proper form sufficient to constitute a valid and effective fixture filing with respect to the Premises under Article 9 of the Uniform Commercial Code as in effect in the State naming Grantor as debtor and Collateral Agent as secured party.

 

9.              Collateral Agent is not required to qualify to transact business in the State nor will Collateral Agent incur any tax imposed by the State (including, without limitation, any tax imposed by the State on interest or on revenue paid in respect of the Credit Agreement), solely as the result of the ownership or recordation of the [Mortgage/Deed of Trust/Deed to Secure Debt].

 

10.       [**FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA:  The Fixture Filing is in appropriate form for recordation in the State.**]

 

11.       [**FOR MICHIGAN, GEORGIA, SOUTH CAROLINA, NORTH DAKOTA OR LOUISIANA:  With respect to that portion of the Mortgaged Property in which a security interest may be perfected by the recordation of a fixture filing in the State (the “Fixtures”), the proper place to file the Fixture Filing is in the [LIST APPROPRIATE COUNTY RECORDING OFFICE] (the “Filing Office”), and no filing or recordation in any other place is necessary under the UCC to perfect a security interest in the Fixtures.  Upon the recordation of the Fixture Filing with the Filing Office, Collateral Agent will have a perfected security interest in the Fixtures.  Subsequent to the recordation of the Fixture Filing in accordance with the procedures set forth above, no other, further or subsequent filing, recordation, registration, re-filing, re-recordation or re-registration of the Fixture Filing or any additional financing statements or any other instrument and no other actions will be necessary or advisable to perfect or continue the perfection of the lien created thereby, except that Article 9 of the UCC requires the recordation of continuation statements within the period of six (6) months prior to the expiration of five (5) years from the date of the original recordation or the recordation of any continuation statement in order to maintain the effectiveness of the Fixture Filing.**]

 

12.       [Except as specifically set forth on Schedule 1 hereto, no] [No] taxes or other charges, including, without limitation, intangible, documentary, stamp, mortgage, transfer or recording taxes or similar charges are payable to the State or to any governmental authority or regulatory body located therein on account of the execution or delivery of the [Mortgage/Deed of Trust/Deed to Secure Debt], or the creation of the liens and security interests thereunder, or the filing, recordation or registration of the [Mortgage/Deed of Trust/Deed to Secure Debt], except for nominal filing or recording fees.

 

13.       Grantor possesses all Healthcare Licenses necessary to operate the Facility as an [independent living/assisted living/Alzheimer’s/memory care — conform as applicable] facility with the respective number of units or beds described on Schedule II of the Credit Agreement.

 

4

 

“Healthcare Licenses” means all certificates of need (or similar), certifications, licenses, permits, or other material approvals or authorizations required by any federal agency and/or [State] as a condition precedent to the operation of the Facility as an [independent living/assisted living/Alzheimer’s/memory care — conform as applicable] facility with the respective number of units or beds described on Schedule II of the Credit Agreement.

 

Qualifications

 

The foregoing opinions are subject to the following qualifications, limitations and exceptions:

 

1.              Qualifying paragraph 1 above, the enforceability of the [Mortgage/Deed of Trust/Deed to Secure Debt] and the liens created thereby may be limited or affected by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally (including, without limitation, fraudulent conveyance laws) and by general principles of equity including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing and the possible unavailability of specific performance or injunctive relief, regardless of whether considered in a proceeding in equity or at law.  The aforesaid opinion as to enforceability of the [Mortgage/Deed of Trust/Deed to Secure Debt] is also subject to the qualification that certain provisions contained therein may not be enforceable, but (subject to the limitations set forth in the foregoing sentence) such unenforceability will not render the [Mortgage/Deed of Trust/Deed to Secure Debt] invalid as a whole or substantially interfere with realization of the principal benefits and/or security provided thereby.

 

2.              In rendering the opinions expressed in this opinion letter, we have made no examination of and express no opinion with respect to:  (i) title to or, except as to adequacy of form, descriptions of the Mortgaged Property described in the [Mortgage/Deed of Trust/Deed to Secure Debt]; (ii) the nature or extent of Grantor’s rights in, or title to, the Mortgaged Property; (iii) the existence or non-existence of liens, security interests, charges or encumbrances thereon or therein actually of record; or (iv) the priority of any liens on any part of the Mortgaged Property.  We have not independently certified the existence, condition, location or ownership of any of the Mortgaged Property.

 

This opinion is given as of the date hereof, and we disclaim any obligation to update this opinion letter for events occurring after the date of this opinion letter.  The foregoing opinion applies only with respect to the laws of the State and the federal laws of the United States of America and we express no opinion with respect to the laws of any other jurisdiction.

 

This opinion is rendered only to Administrative Agent, Collateral Agent and the other Secured Parties and their respective successors and assigns (including any participant in any Secured Party’s interest) and is solely for their benefit in connection with the transactions contemplated by the Subject Documents and may not be relied upon by Administrative Agent, Collateral Agent or any other Secured Party or any of their respective successors or assigns for any other purpose without our prior written consent.

 

	
 
    	
Very truly yours,
    

 

5

 

SCHEDULE 1

 

Mortgage Recording Taxes, Documentary Stamp Taxes
 and other similar Taxes and Fees

 

[**INSERT DESCRIPTION OF AND METHOD OF CALCULATING ALL MORTGAGE RECORDING TAXES, DOCUMENTARY STAMP TAXES AND SIMILAR TAXES AND FEES**]

 

 

EXHIBIT E-3

 

 

EXHIBIT F to the

AMENDED AND RESTATED CREDIT AGREEMENT

 

FORM OF AMENDED AND RESTATED SECURITY AGREEMENT

 

AMENDED AND RESTATED SECURITY AGREEMENT

 

Dated February 24, 2017

 

from

 

THE GRANTORS REFERRED TO HEREIN

 

to

 

CITIBANK, N.A.,

 

as Collateral Agent

 

 

T A B L E  O F  C O N T E N T S

 

	
Section
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
Section 1.
    	
 
    	
Grant of Security
    	
2
    
	
 
    	
 
    	
 
    	
 
    
	
Section 2.
    	
 
    	
Security for   Obligations
    	
5
    
	
 
    	
 
    	
 
    	
 
    
	
Section 3.
    	
 
    	
Grantors Remain Liable
    	
5
    
	
 
    	
 
    	
 
    	
 
    
	
Section 4.
    	
 
    	
Maintaining the Account   Collateral
    	
5
    
	
 
    	
 
    	
 
    	
 
    
	
Section 5.
    	
 
    	
Investing of Amounts in   the L/C Cash Collateral Account
    	
6
    
	
 
    	
 
    	
 
    	
 
    
	
Section 6.
    	
 
    	
Release of Amounts
    	
6
    
	
 
    	
 
    	
 
    	
 
    
	
Section 7.
    	
 
    	
Maintaining Electronic   Chattel Paper and Transferable Records
    	
6
    
	
 
    	
 
    	
 
    	
 
    
	
Section 8.
    	
 
    	
Representations and   Warranties
    	
6
    
	
 
    	
 
    	
 
    	
 
    
	
Section 9.
    	
 
    	
Further Assurances
    	
8
    
	
 
    	
 
    	
 
    	
 
    
	
Section 10.
    	
 
    	
As to Equipment and   Inventory
    	
9
    
	
 
    	
 
    	
 
    	
 
    
	
Section 11.
    	
 
    	
Insurance
    	
10
    
	
 
    	
 
    	
 
    	
 
    
	
Section 12.
    	
 
    	
Post-Closing Changes;   Bailees; Collections on Assigned Agreements, Receivables and Related   Contracts
    	
11
    
	
 
    	
 
    	
 
    	
 
    
	
Section 13.
    	
 
    	
As to the Assigned   Agreements
    	
12
    
	
 
    	
 
    	
 
    	
 
    
	
Section 14.
    	
 
    	
Payments Under the   Assigned Agreements
    	
13
    
	
 
    	
 
    	
 
    	
 
    
	
Section 15.
    	
 
    	
Transfers and Other   Liens; Additional Equity Interests
    	
13
    
	
 
    	
 
    	
 
    	
 
    
	
Section 16.
    	
 
    	
Collateral Agent   Appointed Attorney-in-Fact
    	
13
    
	
 
    	
 
    	
 
    	
 
    
	
Section 17.
    	
 
    	
Collateral Agent   May Perform
    	
13
    
	
 
    	
 
    	
 
    	
 
    
	
Section 18.
    	
 
    	
The Collateral Agent’s   Duties
    	
14
    
	
 
    	
 
    	
 
    	
 
    
	
Section 19.
    	
 
    	
Remedies
    	
14
    
	
 
    	
 
    	
 
    	
 
    
	
Section 20.
    	
 
    	
Indemnity and Expenses
    	
16
    
	
 
    	
 
    	
 
    	
 
    
	
Section 21.
    	
 
    	
Amendments; Waivers;   Additional Grantors, Etc
    	
16
    
	
 
    	
 
    	
 
    	
 
    
	
Section 22.
    	
 
    	
Notices, Etc
    	
16
    
	
 
    	
 
    	
 
    	
 
    
	
Section 23.
    	
 
    	
Continuing Security   Interest; Assignments under the Credit Agreement
    	
17
    
	
 
    	
 
    	
 
    	
 
    
	
Section 24.
    	
 
    	
Release; Termination
    	
17
    
	
 
    	
 
    	
 
    	
 
    
	
Section 25.
    	
 
    	
Security Interest   Absolute
    	
18
    
	
 
    	
 
    	
 
    	
 
    
	
Section 26.
    	
 
    	
Third Party Waivers
    	
19
    

 

 

	
Section 27.
    	
 
    	
Execution in   Counterparts
    	
21
    
	
 
    	
 
    	
 
    	
 
    
	
Section 28.
    	
 
    	
The Credit Agreement   and the Mortgages
    	
21
    
	
 
    	
 
    	
 
    	
 
    
	
Section 29.
    	
 
    	
Governing Law
    	
21
    

 

Schedules

 

	
Schedule I
    	
-
    	
Location, Chief Executive Office, Type of   Organization, Jurisdiction of Organization and Organizational Identification   Number
    
	
Schedule II
    	
-
    	
Borrowing Base Assets and Locations of Equipment and   Inventory
    
	
Schedule III
    	
-
    	
Changes in Name, Location, Etc.
    

 

Exhibits

 

	
Exhibit A
    	
-
    	
Form of Security Agreement Supplement
    
	
Exhibit B
    	
-
    	
Form of Consent and Agreement
    

 

 

AMENDED AND RESTATED SECURITY AGREEMENT

 

AMENDED AND RESTATED SECURITY AGREEMENT dated February 24, 2017 (this “Agreement”) among FIVE STAR QUALITY CARE, INC., a Maryland corporation (the “Borrower”), [insert names of Guarantors under the Credit Agreement] and the ADDITIONAL GRANTORS (as defined in Section 21) (each such Guarantor or Additional Grantor referred to herein as a “Guarantor Grantor”, collectively, the “Guarantor Grantors”, and collectively together with the Borrower, the “Grantors”), and CITIBANK, N.A., as collateral agent (in such capacity, together with any successor collateral agent appointed pursuant to Article VIII of the Credit Agreement (as hereinafter defined), the “Collateral Agent”) for the Secured Parties (as defined in the Credit Agreement).

 

PRELIMINARY STATEMENTS

 

(1)         In connection with that certain Credit Agreement dated as of April 13, 2012 (the “Existing Credit Agreement”), certain Grantors entered into a Security Agreement dated as of April 13, 2012 (the “Existing Security Agreement”) among such Grantors and the Collateral Agent for the benefit of the Secured Parties under the Existing Credit Agreement.

 

(2)         The Grantors and certain other Loan Parties have entered into an Amended and Restated Credit Agreement dated as of the date hereof (such Agreement, as it may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) with the Lender Parties, the Agents, and the Arrangers (each as defined therein).

 

(3)         Pursuant to the Credit Agreement the Grantors are entering into this Agreement in order to grant to the Collateral Agent for the ratable benefit of the Secured Parties a security interest in the Collateral (as hereinafter defined).

 

(4)         In connection with the Existing Credit Agreement, the Borrower opened a letter of credit cash collateral deposit account, (the “L/C Cash Collateral Account”), with Citibank, N.A. in New York, New York, in the name of the Collateral Agent and under the sole control and dominion of the Collateral Agent.  The L/C Cash Collateral Account shall continue to be maintained subject to the terms of this Agreement.

 

(5)         It is a condition precedent to the making of Advances and the issuance of Letters of Credit by the Lender Parties under the Credit Agreement from time to time that the Grantors shall have executed and delivered this Agreement to the Administrative Agent.

 

(6)         Each Grantor will derive substantial direct and indirect benefit from the transactions contemplated by the Loan Documents.

 

(7)         Capitalized terms used but not otherwise defined in this Agreement shall have their respective meanings set forth in the Credit Agreement.  Further, unless otherwise defined in this Agreement or in the Credit Agreement, terms defined in Article 8 or 9 of the UCC (as defined below) are used in this Agreement as such terms are defined in such Article 8 or 9.  “UCC” means the Uniform Commercial Code as in effect, from time to time, in the State of New York; provided, however, that, if perfection or the effect of perfection or non-perfection or the priority of any security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, “UCC” means the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority.

 

 

NOW, THEREFORE, in consideration of the premises, in order to induce the Lender Parties to make Advances and issue Letters of Credit under the Credit Agreement from time to time, and for good and valuable other consideration, the receipt and sufficiency of which is hereby conclusively acknowledged, each Grantor hereby agrees with the Collateral Agent for the ratable benefit of the Secured Parties as follows:

 

Section 1.                   Grant of Security

 

Section 1.1            Guarantor Grantor Collateral.  Each Guarantor Grantor hereby grants to the Collateral Agent, for the ratable benefit of the Secured Parties, a security interest in such Guarantor Grantor’s right, title and interest in and to the following, in each case, as to each type of property described below, whether now owned or hereafter acquired by such Guarantor Grantor, wherever located, and whether now or hereafter existing or arising (collectively, the “Guarantor Grantor Collateral”):

 

(a)         all equipment in all of its forms, including, without limitation, all machinery, tools, motor vehicles, furniture and fixtures, medical and diagnostic equipment and supplies, and all parts thereof and all accessions thereto, including, without limitation, computer programs and supporting information that constitute equipment within the meaning of the UCC but excluding any equipment subject to a Lien permitted by Section 5.02(a)(iv) of the Credit Agreement solely to the extent the documents governing such Lien prohibit the grant of a junior security interest in such equipment (any and all such property being the “Equipment”);

 

(b)         all inventory in all of its forms, including, without limitation, (i) all raw materials, work in process, finished goods and materials used or consumed in the manufacture, production, preparation or shipping thereof, (ii) goods in which such Guarantor Grantor has an interest in mass or a joint or other interest or right of any kind (including, without limitation, goods in which such Guarantor Grantor has an interest or right as consignee) and (iii) goods that are returned to or repossessed or stopped in transit by such Guarantor Grantor), and all accessions thereto and products thereof and documents therefor, including, without limitation, computer programs and supporting information that constitute inventory within the meaning of the UCC (any and all such property being the “Inventory”);

 

(c)          all accounts and payment intangibles (including, without limitation, health-care-insurance receivables), chattel paper (including, without limitation, tangible chattel paper and electronic chattel paper), instruments (including, without limitation, promissory notes), deposit accounts, letter-of-credit rights and other obligations of any kind, whether or not arising out of or in connection with the sale or lease of goods or the rendering of services and whether or not earned by performance, and all rights now or hereafter existing in and to all supporting obligations and in and to all security agreements, mortgages, Liens, leases, letters of credit and other contracts securing or otherwise relating to the foregoing property, but excluding all disbursement accounts, security deposit accounts and cash collateral accounts established for the benefit of third parties in the ordinary course of business and not to secure Debt (any and all of such accounts, chattel paper, instruments, deposit accounts, letter-of-credit rights, general intangibles and other obligations, to the extent not referred to in clause (d), (e) or (f) below, being the “Receivables,” and any and all such supporting obligations, security agreements, mortgages, Liens, leases, letters of credit and other contracts being the “Related Contracts”);

 

(d)         all “general intangibles,” as such term is defined in the UCC, of such Guarantor Grantor and, which, shall include, without limitation, (i) all of such Guarantor Grantor’s rights, title and interest in, to and under all contracts and insurance policies (including all rights and remedies relating to monetary damages, including indemnification rights and remedies, and claims for damages or other relief pursuant to or in respect of any contract), (ii) all know-how and

 

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warranties relating to any of the Collateral or any Borrowing Base Asset, (iii) any and all other rights, claims, choses-in-action and causes of action of such Guarantor Grantor against any other person and the benefits of any and all collateral or other security given by any other person in connection therewith, (iv) all guarantees, endorsements and indemnifications on, or of, any of the Collateral or any of the Borrowing Base Assets, (v) all lists, books, records, (including but not limited to billing and related records) correspondence, ledgers, printouts, files (whether in printed form or stored electronically), tapes and other papers or materials containing information relating to any of the Collateral or any of the Borrowing Base Assets, including all customer, patient, client, resident or tenant lists, identification of suppliers, data, plans, blueprints, specifications, designs, drawings, appraisals, credit files, recorded knowledge, surveys, studies, engineering reports, test reports, manuals, standards, processing standards, performance standards, catalogs, research data, computer and automatic machinery software and programs and the like, field repair data, accounting information pertaining to such Guarantor Grantor’s operations or any of the Collateral or any of the Borrowing Base Assets and all media in which or on which any of the information or knowledge or data or records may be recorded or stored and all computer programs used for the compilation or printout of such information, knowledge, records or data, (vi) all licenses (including, but not limited to, the Healthcare Licenses), consents, permits, variances, certifications, authorizations and approvals, however characterized, now or hereafter acquired or held by such Guarantor Grantor, including building permits, certificates of occupancy, environmental certificates, industrial permits or licenses and certificates of operation, (vii) all rights to reserves, deferred payments, deposits, refunds, indemnification of claims and claims for tax or other refunds against any Governmental Authority and (viii) with respect to each Guarantor Grantor, the goodwill connected with such Guarantor Grantor’s business (any and all such property being the “General Intangibles”);

 

(e)          any agreements beneficial in connection with the operation of such Guarantor Grantor’s business, in each case as such agreements may be amended, amended and restated, supplemented or otherwise modified from time to time (collectively, the “Assigned Agreements”), including, without limitation, (i) all rights of such Guarantor Grantor to receive moneys due and to become due under or pursuant to the Assigned Agreements, (ii) all rights of such Guarantor Grantor to receive proceeds of any insurance, indemnity, warranty or guaranty with respect to the Assigned Agreements, (iii) claims of such Guarantor Grantor for damages arising out of or for breach of or default under the Assigned Agreements and (iv) the right of such Guarantor Grantor to terminate the Assigned Agreements, to perform thereunder and to compel performance and otherwise exercise all remedies thereunder (all such Collateral being the “Agreement Collateral”);

 

(f)           the following (collectively, the “Guarantor Grantor Account Collateral”):

 

(i)                                     all promissory notes, certificates of deposit, deposit accounts, checks and other instruments from time to time delivered to or otherwise possessed by the Collateral Agent for or on behalf of such Guarantor Grantor, including, without limitation, those delivered or possessed in substitution for or in addition to any or all of the then existing Guarantor Grantor Account Collateral; and

 

(ii)                                  all interest, dividends, distributions, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the then existing collateral described in subsections 1.1(f)(i);

 

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(g)          all agreements, permits, consents, orders and franchises relating to the construction, use or operation of any of the Borrowing Base Assets to which such Guarantor Grantor, now or hereafter, is a party or a beneficiary; and

 

(h)         all proceeds of, collateral for, income, royalties and other payments now or hereafter due and payable with respect to, and supporting obligations relating to, any and all of the Guarantor Collateral (including, without limitation, proceeds, collateral and supporting obligations that constitute property of the types described in clauses (a) through (g) of this Section 1.1 and this clause (h)) and, to the extent not otherwise included, all (A) payments under insurance (whether or not the Collateral Agent is the loss payee thereof), or any indemnity, warranty or guaranty, payable by reason of loss or damage to or otherwise with respect to any of the foregoing Guarantor Collateral, (B) tort claims, including, without limitation, all commercial tort claims and (C) cash.

 

Section 1.2                                    Borrower Account Collateral.  In addition, the Borrower hereby grants to the Collateral Agent, for the ratable benefit of the Secured Parties, a security interest in the Borrower’s right, title and interest in and to:

 

(a)         the following (collectively, the “Borrower Account Collateral”):

 

(i)                                     the L/C Cash Collateral Account and all funds and financial assets from time to time credited thereto (including, without limitation, all Cash Equivalents), all interest, dividends, distributions, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such funds and financial assets, and all certificates and instruments, if any, from time to time representing or evidencing the L/C Cash Collateral Account;

 

(ii)                                  all promissory notes, certificates of deposit, deposit accounts, checks and other instruments from time to time delivered to or otherwise possessed by the Collateral Agent for or on behalf of such Grantor, including, without limitation, those delivered or possessed in substitution for or in addition to any or all of the then existing Borrower Account Collateral; and

 

(iii)                               all interest, dividends, distributions, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the then existing collateral described in subsections 1.2(a)(i) and (ii) above;

 

(b)         all proceeds of, collateral for, income, royalties and other payments now or hereafter due and payable with respect to, and supporting obligations relating to, any and all of the Borrower Account Collateral (including, without limitation, proceeds, collateral and supporting obligations that constitute property of the types described in clause (a) of this Section 1.2 and this clause (b)) and, to the extent not otherwise included, all cash;

 

in each case, whether now owned or hereafter acquired by the Borrower, wherever located, and whether now or hereafter existing or arising (the Borrower Account Collateral together with the Guarantor Grantor Account Collateral, the “Account Collateral”) (the Borrower Account Collateral together with the Guarantor Grantor Collateral, the “Collateral”).

 

Section 1.3                                    Scope of Grant.  Notwithstanding anything herein to the contrary, in no event shall the Collateral include or the security interest granted under Section 1.1 and Section 1.2 attach

 

4

 

to (A) any agreement, permit, consent, order or franchise covering real or personal property of any Grantor, and any of its rights or interest thereunder, if and to the extent that the grant of a security interest or lien is prohibited by or in violation of (y) any law, rule, regulation or order, or (z) a term, provision or condition of any such agreement, permit, consent, order or franchise (unless such law, rule, regulation, term, provision or condition would be rendered ineffective with respect to the creation of the security interest hereunder pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other applicable law (including any Bankruptcy Law) or principles of equity) and such provision or condition has not been waived or the consent of the other party to such agreement, permit, consent, order or franchise has not been obtained; provided, however, that the Collateral shall include (and such security interest shall attach) immediately at such time as the contractual or legal prohibition shall no longer be applicable and to the extent severable, shall attach immediately to any portion of such agreement, permit, consent, order or franchise not subject to the prohibitions specified in (y) or (z) above; provided further that the exclusions referred to in this paragraph shall not include any proceeds of any such agreement, permit, consent, order or franchise; or (B) any Transfer Healthcare Asset (and, for the avoidance of doubt, the terms Equipment, Inventory, Receivables, Related Contracts, General Intangibles, Assigned Agreements and Agreement Collateral shall not include any Transfer Healthcare Asset).

 

Section 2.                   Security for Obligations.  This Agreement secures the payment of all Obligations of such Grantor now or hereafter existing under the Loan Documents, whether direct or indirect, absolute or contingent, and whether for principal, reimbursement obligations, interest, fees, premiums, penalties, indemnifications, contract causes of action, costs, expenses or otherwise (all such Obligations being the “Secured Obligations”).  Without limiting the generality of the foregoing, this Agreement secures, as to each Grantor, the payment of all amounts that constitute part of the Secured Obligations and would be owed by such Grantor to any Secured Party under the Loan Documents but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving a Loan Party.  Each Grantor that was a “Grantor” (as defined in the Existing Security Agreement) confirms that it has not been released from the “Secured Obligations” (as defined in the Existing Security Agreement) and that nothing in this Agreement shall be construed as a discharge, extinguishment or novation of the Secured Obligations of such Grantor outstanding under the Existing Security Agreement.

 

Section 3.                   Grantors Remain Liable.  Anything herein to the contrary notwithstanding, (a) each Grantor shall remain liable under the contracts and agreements included in such Grantor’s Collateral to the extent set forth therein to perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed, (b) the exercise by the Collateral Agent of any of the rights hereunder shall not release any Grantor from any of its duties or obligations under the contracts and agreements included in the Collateral and (c) no Secured Party shall have any obligation or liability under the contracts and agreements included in the Collateral solely by reason of this Agreement or any other Loan Document, nor shall any Secured Party be obligated to perform any of the obligations or duties of any Grantor thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

 

Section 4.                   Maintaining the Account Collateral.  So long as any Advance or any other Obligation of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be outstanding, or any Lender Party shall have any Commitment:

 

(a)         The Borrower will maintain the L/C Cash Collateral Account only with the Collateral Agent.

 

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(b)         The Collateral Agent may, at any time and without notice to, or consent from, the Borrower or any Grantor, transfer, or direct the transfer of, funds from the Account Collateral to satisfy the Borrower’s or such Grantor’s obligations under the Loan Documents if an Event of Default shall have occurred and be continuing.

 

Section 5.                   Investing of Amounts in the L/C Cash Collateral Account.  The Collateral Agent will, subject to the provisions of Sections 4, 6 and 19, from time to time (a) (i) invest amounts received with respect to the L/C Cash Collateral Account in such Cash Equivalents credited to the L/C Cash Collateral Account as the Borrower may select and the Collateral Agent may approve in its reasonable discretion, and (ii) invest interest paid on the Cash Equivalents referred to in clause (a)(i) above, in accordance with such clause (a)(i) and (b) reinvest other proceeds of any such Cash Equivalents that may mature or be sold, in each case in such Cash Equivalents credited to the L/C Cash Collateral Account in the same manner.  Interest and proceeds that are not invested or reinvested in Cash Equivalents as provided above shall be deposited and held in the L/C Cash Collateral Account.  In addition, the Collateral Agent shall have the right at any time to exchange such Cash Equivalents for similar Cash Equivalents of smaller or larger determinations, or for other Cash Equivalents, credited to the L/C Cash Collateral Account; provided that no Event of Default has occurred and is continuing, the Borrower may select such Cash Equivalents with the Collateral Agent’s approval in its reasonable discretion.

 

Section 6.                   Release of Amounts.  So long as no Event of Default shall have occurred and be continuing, the Collateral Agent will pay and release to the Borrower or the relevant Grantor or at the Borrower’s order or, at the request of the Borrower, to the Collateral Agent to be applied to the Obligations of the Borrower under the Loan Documents, such amount, if any, as is then on deposit in the L/C Cash Collateral Account, in each case to the extent permitted to be released under the terms of the Credit Agreement.

 

Section 7.                   Maintaining Electronic Chattel Paper and Transferable Records.  So long as any Advance or any other Obligation of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be outstanding, or any Lender Party shall have any Commitment:

 

(a)                                 Each Guarantor Grantor will maintain all (i) electronic chattel paper so that the Collateral Agent has control of the electronic chattel paper in the manner specified in Section 9-105 of the UCC and (ii) all transferable records so that the Collateral Agent has control of the transferable records in the manner specified in Section 16 of the Uniform Electronic Transactions Act, as in effect in the jurisdiction governing such transferable record (“UETA”); and

 

(b)                                 Each Guarantor Grantor will as soon as reasonably practicable give notice to the Collateral Agent of any material commercial tort claim (as defined in Section 9-102(13) of the UCC) of any Guarantor Grantor and will immediately execute or otherwise authenticate a supplement to this Agreement, and otherwise take all necessary action, to subject such commercial tort claim to the first priority security interest created under this Agreement.

 

Section 8.                   Representations and Warranties.  Each Grantor represents and warrants as follows:

 

(a)         Such Grantor’s exact legal name is correctly set forth in Schedule I hereto.  Such Grantor is located (within the meaning of Section 9-307 of the UCC) and has its chief executive office, all original copies of each Assigned Agreement and Related Contract to which such Grantor (if a Guarantor Grantor) is a party, and all originals of all chattel paper that evidence Receivables of such Grantor, in the state or jurisdiction set forth in Schedule I hereto.  The

 

6

 

information set forth in Schedule I hereto with respect to such Grantor is true and accurate in all respects.  Such Grantor has not previously changed its name, location, chief executive office, type of organization, jurisdiction of organization or organizational identification number from those set forth in Schedule I hereto except as disclosed in Schedule III hereto.

 

(b)         All of the Equipment and Inventory of such Grantor (if a Guarantor Grantor) are located at the places specified therefor in Schedule II hereto, as such Schedule II may be amended from time to time pursuant to Section 10(a).  All Collateral consisting of certificated securities and instruments (other than instruments representing a Receivable or Agreement Collateral) have been delivered to the Collateral Agent.  As of the date of this Agreement, none of the Receivables or Agreement Collateral is evidenced by a promissory note or other instrument that has not been delivered to the Collateral Agent if so required to be delivered pursuant to Section 9(c).

 

(c)          Such Grantor is the legal and beneficial owner of the Collateral of such Grantor free and clear of any Lien, claim, option or right of others, except for Liens permitted pursuant to Section 5.02(a) of the Credit Agreement.  As of the date hereof, no effective financing statement or other instrument similar in effect covering all or any part of such Collateral or listing Grantor or any trade name of Grantor as debtor is on file in any recording office, except (i) such as may have been filed in favor of the Collateral Agent relating to the Loan Documents and (ii) to the extent that such financing statement or other instrument similar in effect does not relate to such Grantor’s interest in the Collateral.

 

(d)         Such Grantor (if a Guarantor Grantor) has exclusive possession and control of its Equipment and Inventory.

 

(e)          Each Assigned Agreement to which such Grantor (if a Guarantor Grantor) is a party have been duly authorized, executed and delivered by such Grantor, is in full force and effect and is binding upon and enforceable against all parties thereto in accordance with their terms (subject to Bankruptcy Law and principles of equity, and subject to the terms of the Credit Agreement and this Agreement).  There exists no material default under any Assigned Agreement to which such Grantor is a party by such Grantor, or to such Grantor’s knowledge and to the extent such default, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect, by any party thereto.

 

(f)           As of the date of this Agreement, such Grantor (if a Guarantor Grantor) is not a beneficiary or assignee under any letter of credit.

 

(g)          All filings necessary to perfect the security interest in the Collateral of such Grantor created under this Agreement have been duly made or taken and are in full force and effect, and this Agreement creates in favor of the Collateral Agent for the benefit of the Secured Parties a valid and, together with such filings, perfected first priority security interest in all Collateral of such Grantor that may be perfected by the filing of UCC-1 financing statements, securing the payment of the Secured Obligations.

 

(h)         No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or any other third party is required for (i) the grant by such Grantor of the security interest granted hereunder or for the execution, delivery or performance of this Agreement by such Grantor, (ii) the perfection or maintenance of the security interest created hereunder (including the first priority nature of such security interest), except for the filing of financing and continuation statements under the UCC, the filing of which have been duly authorized, (iii) the exercise by the Collateral Agent of its rights provided for in this

 

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Agreement or the remedies in respect of the Collateral pursuant to this Agreement, except as may be required in connection with the disposition of any portion of the Collateral consisting of securities, security entitlements or pledged financial assets by laws affecting the offering and sale of securities generally, compliance with any applicable healthcare licensing requirements, and notices and other actions contemplated by this Agreement.

 

(i)             The Inventory that has been produced or distributed by such Grantor (if a Guarantor Grantor) has been produced in compliance with all requirements of applicable law, including, without limitation, the Fair Labor Standards Act.

 

(j)            Such Grantor has no commercial tort claims (as defined in Section 9-102(13) of the UCC).

 

Section 9.                   Further Assurances.

 

(a)         Each Grantor agrees that from time to time, at its own expense, such Grantor will promptly execute and deliver, or otherwise authenticate, all further instruments and documents, and take all further action that may be necessary or that the Collateral Agent may reasonably request, in order to perfect and protect any pledge or security interest granted or purported to be granted by such Grantor hereunder or to enable the Collateral Agent to exercise and enforce its rights and remedies hereunder with respect to any Collateral of such Grantor.  Without limiting the generality of the foregoing, each Grantor will, upon the reasonable request of the Collateral Agent, promptly with respect to Collateral of such Grantor:  (i) mark conspicuously each document included in Inventory, each chattel paper included in Receivables, each Related Contract, each Assigned Agreement and each of its records pertaining to such Collateral with a legend, in form and substance satisfactory to the Collateral Agent, indicating that such document, chattel paper, Related Contract, Assigned Agreement or Collateral is subject to the security interest granted hereby; (ii) except as contemplated by Section 9(c), if any such Collateral shall be evidenced by a promissory note or other instrument, deliver and pledge to the Collateral Agent hereunder such note or instrument duly indorsed in blank and accompanied by duly executed instruments of transfer or assignment, all in form and substance satisfactory to the Collateral Agent; (iii) execute or authenticate and file such financing or continuation statements, or amendments thereto, and such other instruments or notices, as may be necessary or as the Collateral Agent may reasonably request, in order to perfect and preserve the security interest granted or purported to be granted by Grantor hereunder; (iv) deliver and pledge to the Collateral Agent for benefit of the Secured Parties certificates representing any Collateral consisting of certificated securities, accompanied by undated stock or bond powers executed in blank; (v) take all action necessary to ensure that the Collateral Agent has control of the Account Collateral, electronic chattel paper, investment property (upon the occurrence and during the continuance of any Event of Default), transferable records as provided in Sections 9-104, 9-105 and 9-106 of the UCC and Section 16 of UETA; (vi) at the request of the Collateral Agent, take all action to ensure that the Collateral Agent’s security interest is noted on any certificate of ownership related to any Collateral evidenced by a certificate of ownership; and (vii) deliver to the Collateral Agent evidence that all other action that the Collateral Agent may reasonably deem necessary or desirable in order to perfect and protect the security interest created by Grantor under this Agreement has been taken.

 

(b)         Each Guarantor Grantor hereby authorizes the Collateral Agent to file one or more financing or continuation statements, and amendments thereto, including, without limitation, one or more financing statements indicating that such financing statements cover all assets or all personal property (or words of similar effect) of such Guarantor Grantor (exclusive of agreements that by their terms prohibit the creation of a Lien thereon, but only to the extent, and for so long as, such prohibition is not terminated or rendered unenforceable or otherwise deemed ineffective 

 

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by the UCC or any other applicable law), in each case without the signature of such Grantor, and regardless of whether any particular asset described in such financing statements falls within the scope of the UCC or the granting clause of this Agreement.  A photocopy or other reproduction of this Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement where permitted by law. Each Grantor ratifies its authorization for the Collateral Agent to have filed such financing statements, continuation statements or amendments filed prior to the date hereof.

 

(c)          Each Grantor will furnish to the Collateral Agent from time to time statements and schedules further identifying and describing the Collateral of such Grantor and such other reports in connection with such Collateral as the Collateral Agent may reasonably request, all in reasonable detail.

 

(d)         If at any time any amount then payable under or in connection with any of the Receivables or Agreement Collateral shall be evidenced by any promissory note or other instrument, and such amount, together with all amounts payable evidenced by any promissory note or other instrument not previously delivered to the Collateral Agent exceeds $1,000,000 in the aggregate for all Grantors, the Grantor acquiring such promissory note or other instrument shall promptly (but in any event within thirty (30) days after receipt thereof) endorse, assign and deliver the same to the Collateral Agent, accompanied by such instruments of transfer or assignment duly executed in blank as the Collateral Agent may from time to time specify.

 

(e)          If after the date hereof any Grantor becomes a beneficiary under a letter of credit now or hereafter issued, such Grantor shall promptly notify the Collateral Agent thereof and such Grantor shall, upon the occurrence and during the continuation of an Event of Default, at the request of the Collateral Agent, pursuant to an agreement in form and substance reasonably satisfactory to the Collateral Agent, either (i) arrange for the issuer and any confirmer of such letter of credit to consent to an assignment to the Collateral Agent of the proceeds of any drawing under the letter of credit or (ii) arrange for the Collateral Agent to become the transferee beneficiary of such Letter of Credit, with the Collateral Agent agreeing, in each case, that the proceeds of any drawing under the letter of credit are to be applied as provided in the Credit Agreement. The actions in the preceding sentence shall not be required to the extent that the amount of any such Letter of Credit, together with the aggregate amount of all other letters of credit for which the actions described above in clauses (i) and (ii) have not been taken, does not exceed $1,000,000 in the aggregate for all Grantors.

 

Section 10.            As to Equipment and Inventory.

 

(a)         Each Guarantor Grantor will keep the Equipment and Inventory of such Grantor (other than any Equipment or Inventory transferred in accordance with Section 5.02(e)(ii) or Section 5.02(e)(iii) of the Credit Agreement) at the places therefor specified in Section 8(b).

 

(b)         Each Guarantor Grantor will cause the Equipment of such Grantor to be maintained and preserved in the same condition, repair and working order as when new, ordinary wear and tear excepted, and will forthwith, or in the case of any loss or damage to any of such Equipment as soon as practicable after the occurrence thereof, make or cause to be made all repairs, replacements and other improvements in connection therewith that are necessary or desirable to such end.  Each Guarantor Grantor will promptly furnish to the Collateral Agent a statement respecting any loss or damage exceeding $1,000,000 to any of the Equipment or Inventory of such Grantor.

 

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(c)          Each Guarantor Grantor will pay promptly when due all property and other taxes, assessments and governmental charges or levies imposed upon, and all claims (including, without limitation, claims for labor, materials and supplies) against, the Equipment and Inventory of such Grantor, except to the extent payment thereof is not required by Section 5.01(b) of the Credit Agreement.  In producing its Inventory, each Guarantor Grantor will comply with all requirements of applicable law, including, without limitation, the Fair Labor Standards Act.

 

Section 11.            Insurance.  

 

(a)   Each Guarantor Grantor will, at its own expense, maintain insurance with respect to the Equipment and Inventory of such Guarantor Grantor in such amounts, against such risks, in such form and with such insurers, as shall be reasonably satisfactory to the Collateral Agent from time to time.  Each policy of each Guarantor Grantor for liability insurance shall provide for all losses to be paid on behalf of the Collateral Agent and such Guarantor Grantor as their interests may appear, and each policy for property damage insurance shall provide for all losses (except for losses of less than $1,000,000 per occurrence) to be paid directly to the Collateral Agent.  Each such policy shall in addition (i) name such Guarantor Grantor and the Collateral Agent as insured parties thereunder (without any representation or warranty by or obligation upon the Collateral Agent) as their interests may appear, (ii) contain the agreement by the insurer that any loss thereunder shall be payable to the Collateral Agent notwithstanding any action, inaction or breach of representation or warranty by such Guarantor Grantor, (iii) provide that there shall be no recourse against the Collateral Agent for payment of premiums or other amounts with respect thereto and (iv) provide that at least 10 days’ prior written notice of cancellation or of lapse shall be given to the Collateral Agent by the insurer.  Each Guarantor Grantor will, if so requested by the Collateral Agent, deliver to the Collateral Agent original or duplicate policies of such insurance and, as often as the Collateral Agent may reasonably request, a report of a reputable insurance broker with respect to such insurance.  Further, each Guarantor Grantor will, at the request of the Collateral Agent, duly execute and deliver instruments of assignment of such insurance policies to comply with the requirements of Section 9 and cause the insurers to acknowledge notice of such assignment.

 

(b)         Reimbursement under any liability insurance maintained by any Grantor pursuant to this Section 11 may be paid directly to the Person who shall have incurred liability covered by such insurance.  In case of any loss involving damage to Equipment or Inventory when subsection (c) of this Section 11 is not applicable, the applicable Grantor will make or cause to be made the necessary repairs to or replacements of such Equipment or Inventory, and any proceeds of insurance properly received by or released to such Grantor shall be used by such Grantor, except as otherwise required hereunder or by the Credit Agreement, to pay or as reimbursement for the costs of such repairs or replacements.

 

(c)          So long as no Event of Default shall have occurred and be continuing, all insurance payments received by the Collateral Agent in connection with any loss, damage or destruction of any Inventory or Equipment will be released by the Collateral Agent for the benefit of the applicable Grantor within a reasonably prompt period of time from a request therefor for the repair, replacement or restoration thereof, subject to such terms and conditions with respect to the release thereof as the Collateral Agent may reasonably require, including, without limitation, that such payments be made directly by the Collateral Agent to the applicable contractors performing the repair, replacement and restoration work.  Upon the occurrence and during the continuance of any Event of Default, all insurance payments in respect of such Equipment or Inventory shall be paid to the Collateral Agent and shall be, in the Collateral Agent’s sole discretion, (i) released to the applicable Grantor to be applied as set forth in the first sentence of this subsection (c) or (ii) applied as specified in Section 19(b).

 

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Section 12.            Post-Closing Changes; Bailees; Collections on Assigned Agreements, Receivables and Related Contracts.  

 

(a)         No Grantor will change its name, type of organization, jurisdiction of organization, organizational identification number or location from those set forth in Section 8(a) of this Agreement without first giving at least 30 days’ prior written notice to the Collateral Agent and taking all action required by the Collateral Agent for the purpose of perfecting or protecting the security interest granted by this Agreement (no such prior notice being required for the change in name disclosed in item 2 of Schedule III, provided that Borrower shall provide notice of such change in name and evidence thereof not later than five (5) Business Days following such change in name).  No Guarantor Grantor will change the location of its Equipment and Inventory (other than Inventory sold in the ordinary course of business) or the place where it keeps the originals of the Assigned Agreements and Related Contracts to which such Grantor is a party and the originals of all chattel paper that evidence Receivables of such Grantor from the locations therefor specified in Sections 8(a) and 8(b) without first giving the Collateral Agent 30 days’ prior written notice of such change.  Except as not otherwise prohibited by the Credit Agreement, no Grantor will become bound by a security agreement authenticated by another Person (determined as provided in Section 9-203(d) of the UCC) without giving the Collateral Agent 30 days’ prior written notice thereof and taking all action required by the Collateral Agent to ensure that the perfection and first priority nature of the Collateral Agent’s security interest in the Collateral will be maintained.  Each Grantor will hold and preserve its records relating to the Collateral, including, without limitation, the Assigned Agreements and Related Contracts, and will, upon reasonable notice, permit representatives of the Collateral Agent at any time during normal business hours to inspect and make abstracts from such records and other documents.  If the Grantor does not have an organizational identification number and later obtains one, it will forthwith notify the Collateral Agent of such organizational identification number.

 

(b)         If any Collateral of any Guarantor Grantor is at any time in the possession or control of a warehouseman, bailee or agent, such Grantor will, upon the request of the Collateral Agent (i) notify such warehouseman, bailee or agent of the security interest created hereunder, (ii) instruct such warehouseman, bailee or agent to hold all such Collateral solely for the Collateral Agent’s account subject only to the Collateral Agent’s instructions (which shall permit such Collateral to be removed by such Grantor in the ordinary course of business until the Collateral Agent notifies such warehouseman, bailee or agent that an Event of Default has occurred and is continuing), (iii) use commercially reasonable efforts, to cause such warehouseman, bailee or agent to authenticate a record acknowledging that it holds possession of such Collateral for the Collateral Agent’s benefit and shall act solely on the instructions of the Collateral Agent without the further consent of the Grantor or any other Person, and (iv) make such authenticated record available to the Collateral Agent.

 

(c)          Except as otherwise provided in this subsection (c), each Guarantor Grantor will continue to collect, at its own expense, all amounts due or to become due such Grantor under the Assigned Agreements, Receivables and Related Contracts.  In connection with such collections, such Grantor may take (and at the Collateral Agent’s reasonable direction will take) such action as such Grantor or Collateral Agent may deem necessary or advisable to enforce collection of the Assigned Agreements, Receivables and Related Contracts; provided, however, that the Collateral Agent shall have the right at any time upon the occurrence and during the continuance of an Event of Default under the Credit Agreement, and upon written notice to such Grantor of its intention to do so, to notify the Obligors under any Assigned Agreements, Receivables and Related Contracts of the assignment of such Assigned Agreements, Receivables and Related Contracts to the Collateral Agent and to direct such Obligors to make payment of all amounts due or to become due to such Grantor thereunder directly to the Collateral Agent and, upon such notification and at the expense of such Grantor, to enforce collection of any such Assigned 

 

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Agreements, Receivables and Related Contracts, to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done, and to otherwise exercise all rights with respect to such Assigned Agreements, Receivables and Related Contracts, including, without limitation, those set forth set forth in Section 9-607 of the UCC.  After receipt by any Grantor of the notice from the Collateral Agent referred to in the proviso to the preceding sentence, (i) all amounts and proceeds (including, without limitation, instruments) received by such Grantor in respect of the Assigned Agreements, Receivables and Related Contracts of such Grantor shall be received in trust for the benefit of the Collateral Agent hereunder, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Collateral Agent in the same form as so received (with any necessary indorsement) and applied as provided in Section 19(b) and (ii) such Grantor will not adjust, settle or compromise the amount or payment of any Receivable or amount due on any Assigned Agreement or Related Contract, release wholly or partly any Obligor thereof, or allow any credit or discount thereon.  No Grantor will permit or consent to the subordination of its right to payment under any of the Assigned Agreements, Receivables and Related Contracts to any other indebtedness or obligations of the Obligor thereof.

 

Section 13.            As to the Assigned Agreements.

 

(a)         Each Guarantor Grantor will at its expense (i) perform and observe all terms and provisions of the Assigned Agreements to be performed or observed by it, and, except as otherwise permitted by Section 13(b) hereof, maintain the Assigned Agreements to which it is party in full force and effect, enforce the Assigned Agreements to which it is a party in the best interests of the applicable Borrowing Base Asset, all in accordance with the terms thereof and in accordance with sound business judgment and take all such action to such end as may be requested from time to time by the Collateral Agent, and (ii) furnish to the Collateral Agent promptly upon receipt thereof copies of all notices, requests and other documents received by such Grantor under or pursuant to the Assigned Agreements to which it is a party, and from time to time (A) furnish to the Collateral Agent such information and reports regarding the Assigned Agreements and such other Collateral of such Grantor as the Collateral Agent may reasonably request and (B) upon request of the Collateral Agent make to each other party to any Assigned Agreement to which it is a party such demands and requests for information and reports or for action as such Grantor is entitled to make thereunder.

 

(b)         Each Guarantor Grantor agrees that it will not, except to the extent otherwise not prohibited by the Credit Agreement:

 

(i)                                     cancel or terminate any Assigned Agreement to which it is a party or consent to or accept any cancellation or termination thereof;

 

(ii)                                  amend, amend and restate, supplement or otherwise modify any such Assigned Agreement or give any consent, waiver or approval thereunder (unless otherwise required to do so pursuant to the terms thereof) that would impair the value of the interests or rights of Grantor thereunder or that would impair the interests or rights of any Secured Party, in either case, in any material respect;

 

(iii)                               waive any default under or breach of any such Assigned Agreement; or

 

(iv)                              take any other action in connection with any such Assigned Agreement that would impair the value of the interests or rights of such Grantor thereunder or that would impair the interests or rights of any Secured Party, in either case, in any material respect.

 

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(c)          Each Grantor hereby consents on its behalf and on behalf of its Subsidiaries to the assignment and pledge to the Collateral Agent for benefit of the Secured Parties of each Assigned Agreement to which it is a party by any other Grantor hereunder.

 

Section 14.            Payments Under the Assigned Agreements.  

 

(a)         Each Grantor agrees that, upon the occurrence and during the continuance of any Event of Default, all payments due or to become due to such Grantor under or in connection with such Assigned Agreement will be made in accordance with the instructions of the Collateral Agent.

 

(b)         All moneys received or collected pursuant to subsection (a) above shall be applied as provided in Section 19(b).

 

Section 15.            Transfers and Other Liens; Additional Equity Interests.  

 

(a)         Each Grantor agrees that it will not (i) sell, assign or otherwise dispose of, or grant any option with respect to, any of the Collateral, other than sales, assignments and other dispositions of Collateral, and options relating to Collateral, permitted under the terms of the Credit Agreement, or (ii) create or suffer to exist any Lien upon or with respect to any of the Collateral except for the pledge, assignment and security interest created under this Agreement and Liens permitted under Section 5.02(a) of the Credit Agreement.

 

(b)         No Grantor shall permit to become effective in any document creating, governing or providing for any permit, license or agreement benefitting such Grantor or any of its Affiliates, a provision that would prohibit the creation of a Lien on such permit, license or agreement in favor of the Collateral Agent unless such provision is customary and reasonably necessary in the ordinary course of business of such Grantor.

 

Section 16.            Collateral Agent Appointed Attorney-in-Fact.  To the extent permitted by applicable law, each Grantor hereby irrevocably appoints the Collateral Agent such Grantor’s attorney-in-fact, with full authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, from time to time upon the occurrence and during the continuance of an Event of Default in the Collateral Agent’s discretion, to take any action and to execute any instrument that the Collateral Agent may deem necessary or advisable to accomplish the purposes of this Agreement, including, without limitation:

 

(a)         to obtain and adjust insurance required to be paid to the Collateral Agent pursuant to Section 11,

 

(b)         to ask for, demand, collect, sue for, recover, compromise, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral,

 

(c)          to receive, indorse and collect any drafts or other instruments, documents and chattel paper, in connection with clause (a) or (b) above, and

 

(d)         to file any claims or take any action or institute any proceedings that the Collateral Agent may deem necessary or desirable for the collection of any of the Collateral or otherwise to enforce compliance with the terms and conditions of any Assigned Agreement or the rights of the Collateral Agent with respect to any of the Collateral.

 

Section 17.            Collateral Agent May Perform.  If any Grantor fails to perform any agreement contained herein, the Collateral Agent may, upon the occurrence and during the continuance of 

 

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an Event of Default, but without any obligation to do so and without notice, itself perform, or cause performance of, such agreement, and the expenses of the Collateral Agent incurred in connection therewith shall be payable by such Grantor under Section 20.

 

Section 18.            The Collateral Agent’s Duties.  

 

(a)         The powers conferred on the Collateral Agent hereunder are solely to protect the Secured Parties’ interest in the Collateral and shall not impose any duty upon it to exercise any such powers.  Except for (i) the exercise of reasonable care with respect to, and the safe custody of, any Collateral in its possession and the accounting for moneys actually received by it hereunder, and (ii) liability for the gross negligence or willful misconduct of any of the Collateral Agent’s officers, directors, agents or employees, the Collateral Agent shall have no duty or liability as to any Collateral, as to ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relative to any Collateral, whether or not any Secured Party has or is deemed to have knowledge of such matters, or as to the taking of any necessary steps to preserve rights against any parties or any other rights pertaining to any Collateral.  The Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of any Collateral in its possession if such Collateral is accorded treatment substantially equal to that which it accords its own property.

 

(b)         Anything contained herein to the contrary notwithstanding, the Collateral Agent may from time to time, when the Collateral Agent deems it to be necessary, appoint one or more subagents (each, a “Subagent”) for the Collateral Agent hereunder with respect to all or any part of the Collateral.  In the event that the Collateral Agent so appoints any Subagent with respect to any Collateral, (i) the assignment and pledge of such Collateral and the security interest granted in such Collateral by each Grantor hereunder shall be deemed for purposes of this Security Agreement to have been made to such Subagent, in addition to the Collateral Agent, for the ratable benefit of the Secured Parties, as security for the Secured Obligations of such Grantor, (ii) such Subagent shall automatically be vested, in addition to the Collateral Agent, with all rights, powers, privileges, interests and remedies of the Collateral Agent hereunder with respect to such Collateral, and (iii) the term “Collateral Agent,” when used herein in relation to any rights, powers, privileges, interests and remedies of the Collateral Agent with respect to such Collateral, shall include such Subagent; provided, however, that no such Subagent shall be authorized to take any action with respect to any such Collateral unless and except to the extent expressly authorized in writing by the Collateral Agent.

 

Section 19.            Remedies.  If any Event of Default shall have occurred and be continuing:

 

(a)         The Collateral Agent may exercise in respect of the Collateral, in addition to other rights and remedies provided for herein or otherwise available to it, all the rights and remedies of a secured party upon default under the UCC (whether or not the UCC applies to the affected Collateral) and also may:  (i) require each Grantor to, and each Grantor hereby agrees that it will at its expense and upon request of the Collateral Agent forthwith, assemble all or part of the Collateral, to the extent such Collateral is susceptible of assembly, as directed in writing by the Collateral Agent and make it available to the Collateral Agent at a place and time to be designated by the Collateral Agent that is reasonably convenient to both parties; (ii) without notice except as specified below, sell the Collateral or any part thereof in one or more parcels at public or private sale, at any of the Collateral Agent’s offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as the Collateral Agent may deem commercially reasonable; (iii) peaceably occupy any premises owned or leased by any of the Guarantor Grantors where the Collateral or any part thereof is assembled or located for a reasonable period in order to effectuate its rights and remedies hereunder or under law, without obligation to such Grantor in respect of such occupation; and (iv) exercise any and all rights and remedies of any of 

 

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the Grantors under or in connection with the Collateral, or otherwise in respect of the Collateral, including, without limitation, (A) any and all rights of such Grantor to demand or otherwise require payment of any amount under, or performance of any provision of, the Assigned Agreements, the Receivables, the Related Contracts and the other Collateral, (B) withdraw, or cause or direct the withdrawal, of all funds with respect to the Account Collateral, (C) without notice to the Borrower or any other Loan Party, except as required by law and at any time or from time to time, charge, set-off and otherwise apply all or any part of the Secured Obligations against any funds held with respect to the Collateral in any deposit account and (D) exercise all other rights and remedies with respect to the Assigned Agreements, the Receivables, the Related Contracts and the other Collateral, including, without limitation, those set forth in Section 9-607 of the UCC.  Each Grantor agrees that, to the extent notice of sale shall be required by law, at least ten days’ notice to such Grantor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification.  The Collateral Agent shall not be obligated to make any sale of Collateral regardless of notice of sale having been given.  The Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned.

 

(b)         Any cash held by or on behalf of the Collateral Agent and all cash proceeds received by or on behalf of the Collateral Agent in respect of any sale of, collection from, or other realization upon all or any part of the Collateral will be applied (after payment of any amounts payable to the Collateral Agent pursuant to Section 20) by the Collateral Agent for the ratable benefit of the Secured Parties against the Secured Obligations, in the following manner:

 

(i)                                     first, paid to the Agents for any amounts then owing to the Agents pursuant to Section 9.04 of the Credit Agreement or otherwise under the Loan Documents, ratably in accordance with such respective amounts then owing to the Agents; and

 

(ii)                                  second, ratably (A) paid to the Lender Parties for any amounts then owing to them under the Loan Documents ratably in accordance with such respective amounts then owing to such Lender Parties and (B) deposited as Collateral in the L/C Cash Collateral Account up to an amount equal to 100% of the aggregate Available Amount of all outstanding Letters of Credit, provided that in the event that any such Letter of Credit is drawn, the Collateral Agent shall pay to the Issuing Bank that issued such Letter of Credit the amount held in the L/C Cash Collateral Account in respect of such Letter of Credit, provided further that, to the extent that any such Letter of Credit shall expire or terminate undrawn and as a result thereof the amount of the Collateral in the L/C Cash Collateral Account shall exceed 100% of the aggregate Available Amount of all then outstanding Letters of Credit, such excess amount of such Collateral shall be applied in accordance with the remaining order of priority set out in this Section 19(b).

 

Any surplus of such cash or cash proceeds held by or on the behalf of the Collateral Agent and remaining after payment in full of all the Secured Obligations shall be paid over to the applicable Grantor or to whomsoever may be lawfully entitled to receive such surplus.

 

(c)          All payments received by any Grantor under or in connection with any Assigned Agreement or otherwise in respect of the Collateral shall be received in trust for the benefit of the Collateral Agent, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Collateral Agent in the same form as so received (with any necessary indorsement).

 

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(d)         The Collateral Agent may, without notice to any Grantor except as required by law and at any time or from time to time, charge, set-off and otherwise apply all or any part of the Secured Obligations against any funds held by it or another Secured Party with respect to the Account Collateral or in any other deposit account.

 

Section 20.            Indemnity and Expenses.  

 

(a)         Each Grantor agrees to indemnify, defend and save and hold harmless each Secured Party and each of their Affiliates and their respective officers, directors, employees, agents and advisors (each, an “Indemnified Party”) from and against, and shall pay on demand, any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and expenses of counsel) that may be incurred by or asserted or awarded against any Indemnified Party, in each case arising out of or in connection with or resulting from this Agreement (including, without limitation, enforcement of this Agreement), except to the extent such claim, damage, loss, liability or expense is found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party’s gross negligence or willful misconduct.

 

(b)         Each Grantor will upon demand pay to the Collateral Agent the amount of any and all reasonable expenses, including, without limitation, the reasonable fees and expenses of its counsel and of any experts and agents, that the Collateral Agent may incur in connection with (i) the administration of this Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection from or other realization upon, any of the Collateral of such Grantor, (iii) the exercise or enforcement of any of the rights of the Collateral Agent or the other Secured Parties hereunder or (iv) the failure by such Grantor to perform or observe any of the provisions hereof.

 

Section 21.            Amendments; Waivers; Additional Grantors, Etc.  (a)  No amendment shall in any event be effective unless the same shall be in writing and signed by the parties hereto.  No waiver of any provision of this Agreement, and no consent to any departure by any Grantor herefrom, shall in any event be effective unless the same shall be in writing and signed by the Collateral Agent, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.  No failure on the part of the Collateral Agent or any other Secured Party to exercise, and no delay in exercising any right hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right.

 

(b)  Upon the execution and delivery, or authentication, by any Person of a security agreement supplement in substantially the form of Exhibit A hereto (each, a “Security Agreement Supplement”), (i) such Person shall be referred to as an “Additional Grantor” and shall be and become a Grantor hereunder, and each reference in this Agreement and the other Loan Documents to “Grantor” or “Guarantor Grantor” shall also mean and be a reference to such Additional Grantor,  and each reference in this Agreement and the other Loan Documents to “Collateral” shall also mean and be a reference to the Collateral of such Additional Grantor, and (ii) the supplemental schedules I-III attached to each Security Agreement Supplement (the “Supplemental Schedules”) shall be incorporated into and become a part of and supplement Schedules I-III, respectively, hereto (the “Schedules”), and the Collateral Agent may attach such Supplemental Schedules to such Schedules; and each reference to such Schedules shall mean and be a reference to such Schedules as supplemented pursuant to each Security Agreement Supplement.

 

Section 22.            Notices, Etc.  All notices and other communications provided for hereunder shall be given in accordance with Section 9.02 of the Credit Agreement.  Delivery by telecopier or email (in .pdf or similar electronic format) of an executed counterpart of any amendment or waiver of any provision of this Agreement or of any Security Agreement Supplement or the Schedules hereto shall be effective as delivery of an original executed counterpart thereof.

 

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Section 23.            Continuing Security Interest; Assignments under the Credit Agreement.  This Agreement shall create a continuing security interest in the Collateral and shall (a) remain in full force and effect until the latest of (i) the payment in full in cash of the Secured Obligations, (ii) the Termination Date and (iii) the termination or expiration or cash collateralization on terms satisfactory to the Collateral Agent of all Letters of Credit, (b) be binding upon each Grantor, its successors and assigns and (c) inure, together with the rights and remedies of the Collateral Agent hereunder, to the benefit of the Secured Parties and their respective successors, transferees and assigns.  Without limiting the generality of the foregoing clause (c), any Lender Party may assign or otherwise transfer all or any portion of its rights and obligations under the Credit Agreement in accordance with the terms thereof (including, without limitation, all or any portion of its Commitments, the Advances owing to it and the Note or Notes, if any, held by it) to any other Person, and such other Person shall thereupon become vested with all the benefits in respect thereof granted to such Lender Party herein or otherwise, in each case as provided in Section 9.07 of the Credit Agreement.

 

Section 24.            Release; Termination.  

 

(a)         Upon any sale, lease, transfer or other disposition of any item of Collateral of any Grantor not in violation of any of the terms of the Loan Documents (other than sales of Inventory in the ordinary course of business as to which any security interest therein shall be automatically released), or any Transfer Healthcare Asset, the Collateral Agent will, at such Grantor’s expense, execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence the release of such item of Collateral or such Transfer Healthcare Asset from the assignment and security interest granted hereby; provided, however, that (i) at the time of such request and such release no Event of Default shall have occurred and be continuing and (ii) such Grantor shall have delivered to the Collateral Agent, at least five Business Days prior to the date of the proposed release, a written request for release describing the item of Collateral and the terms of the sale, lease, transfer or other disposition in reasonable detail, including a form of release for execution by the Collateral Agent and a certificate of Grantor to the effect that the transaction is in compliance with the Loan Documents and as to such other matters as the Collateral Agent may request.

 

(b)         Upon any Transfer of a Borrowing Base Asset or designation of a Borrowing Base Asset as a non-Borrowing Base Asset in accordance with Section 5.02(e)(iii) of the Credit Agreement, the Collateral Agent will, at such Grantor’s expense, execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence the release of any item of Collateral related to such Borrowing Base Asset from the assignment and security interest granted hereby; provided, however, that (i) at the time of such request and such release no Event of Default shall have occurred and be continuing or shall result from such Transfer and (ii) such Grantor shall have delivered to the Collateral Agent, at least five Business Days prior to the date of the proposed release, a written request for release describing the item of Collateral, including a form of release for execution by the Collateral Agent.

 

(c)          Upon the latest of (i) the payment in full in cash of the Secured Obligations, (ii) the Termination Date and (iii) the termination or expiration or cash collateralization on terms satisfactory to the Collateral Agent of all Letters of Credit, the pledge and security interest granted hereby shall terminate and all rights to the Collateral shall revert to the applicable Grantor.  Upon any such termination, the Collateral Agent will, at the applicable Grantor’s expense, execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence such termination.

 

Upon the effectiveness of any release of the security interest granted herein in any Collateral, Collateral Agent shall promptly authorize Borrower or the applicable Guarantor Grantor to file 

 

17

 

any UCC amendments terminating any financing statements filed by the Collateral Agent to perfect its security interest in such Collateral granted under any of the Security Documents.

 

Section 25.            Security Interest Absolute.  The obligations of each Grantor under this Agreement are independent of the Secured Obligations or any other Obligations of any other Loan Party under or in respect of the Loan Documents, and a separate action or actions may be brought and prosecuted against each Grantor to enforce this Agreement, irrespective of whether any action is brought against such Grantor or any other Loan Party or whether such Grantor or any other Loan Party is joined in any such action or actions.  All rights of the Collateral Agent and the other Secured Parties and the pledge, assignment and security interest hereunder, and all obligations of each Grantor hereunder, shall be irrevocable, absolute and unconditional irrespective of, and each Grantor hereby irrevocably waives (to the maximum extent permitted by applicable law) any defenses it may now have or may hereafter acquire in any way relating to, any or all of the following:

 

(a)         any lack of validity or enforceability of any Loan Document or any other agreement or instrument relating thereto;

 

(b)         any change in the time, manner or place of payment of, or in any other term of, all or any of the Secured Obligations or any other Obligations of any other Loan Party under or in respect of the Loan Documents or any other amendment or waiver of or any consent to any departure from any Loan Document, including, without limitation, any increase in the Secured Obligations resulting from the extension of additional credit to any Loan Party or any of its Subsidiaries or otherwise;

 

(c)          any taking, exchange, release or non-perfection of any Collateral or any other collateral, or any taking, release or amendment or waiver of or consent to departure from any guaranty, for all or any of the Secured Obligations;

 

(d)         any manner of application of any Collateral or any other collateral, or proceeds thereof, to all or any of the Secured Obligations, or any manner of sale or other disposition of any Collateral or any other collateral for all or any of the Secured Obligations or any other Obligations of any other Loan Party under or in respect of the Loan Documents or any other assets of any Loan Party or any of its Subsidiaries;

 

(e)          any change, restructuring or termination of the corporate structure or existence of any Loan Party or any of its Subsidiaries;

 

(f)           any failure of any Secured Party to disclose to any Loan Party any information relating to the business, condition (financial or otherwise), operations, performance, assets, nature of assets, liabilities or prospects of any other Loan Party now or hereafter known to such Secured Party (each Grantor waiving any duty on the part of the Secured Parties to disclose such information);

 

(g)          the failure of any other Person to execute this Agreement or any other Collateral Document, guaranty or agreement or the release or reduction of liability of any Grantor or other grantor or surety with respect to the Secured Obligations; or

 

(h)         any other circumstance (including, without limitation, any statute of limitations) or any existence of or reliance on any representation by any Secured Party that might otherwise constitute a defense available to, or a discharge of, such Grantor or any other Grantor or a third party grantor of a security interest.

 

18

 

This Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Secured Obligations is rescinded or must otherwise be returned by any Secured Party or by any other Person upon the insolvency, bankruptcy or reorganization of any Loan Party or otherwise, all as though such payment had not been made.

 

Section 26.            Third Party Waivers.  

 

(a)                                 Each Grantor authorizes the Collateral Agent to perform any or all of the following acts at any time in its sole discretion, all without notice to any Grantor, without affecting such Grantor’s obligations under this Agreement or any other Loan Documents and without affecting the liens and encumbrances against the Collateral in favor of the Collateral Agent:

 

(i)                                     Subject to Section 9.01 of the Credit Agreement, the Collateral Agent may alter any terms of the Obligations or any part thereof, including renewing, compromising, extending or accelerating, or otherwise changing the time for payment of, or increasing or decreasing the rate of interest on, the Obligations or any part thereof.

 

(ii)                                  The Collateral Agent may take and hold security for the Obligations, accept additional or substituted security, and subordinate, exchange, enforce, waive, release, compromise, fail to perfect and sell or otherwise dispose of any such security.

 

(iii)                               The Collateral Agent may direct the order and manner of any sale of all or any part of any security now or later to be held for the Obligations, and the Collateral Agent (or its nominees or designees) may also bid at any such sale.

 

(iv)                              The Collateral Agent may apply any payments or recoveries from any Borrower, any Grantor or any other source, and any proceeds of any security, to the obligations under the Loan Documents in such manner, order and priority as the Collateral Agent may elect.

 

(v)                                 The Collateral Agent may release any Borrower or any other person or entity of its liability for the Obligations or any part thereof.

 

(vi)                              The Collateral Agent may substitute, add or release any one or more guarantors or endorsers.

 

(vii)                           In addition to the Obligations, the Collateral Agent may extend other credit to any Borrower, and may take and hold security for the credit so extended.

 

(b)         Each Grantor waives:

 

(i)                                     Any right it may have to require the Collateral Agent to proceed against any Borrower, any Grantor or any other person or entity, proceed against or exhaust any security held from any Borrower, any Grantor or any person or entity, or pursue any other remedy in the Collateral Agent’s power to pursue;

 

(ii)                                  Any defense based on any claim that any Grantor’s obligations exceed or are more burdensome than those of any Borrower, any Grantor or any other Person;

 

(iii)                               Any defense:  (A) based on any legal disability of any other Person, (B) based on any release, discharge, modification, impairment or limitation of the liability of any other person or entity to the Collateral Agent from any cause, whether consented to by the Collateral Agent or arising by operation of law, (C) arising out of or able to be asserted as a result of any case, action 

 

19

 

or proceeding before any court or other governmental authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of any other person or entity or any of their respective affiliates, or any general assignment for the benefit of creditors, composition, marshaling of assets for creditors or other, similar arrangement in respect of its creditors generally or any substantial portion of its creditors; in each case as undertaken under any U.S. Federal or State law (each of the foregoing described in this clause (C) being referred to herein as an “Insolvency Proceeding”); or (D) arising from any rejection or disaffirmance of the Obligations, or any part thereof, or any security held therefor, in any such Insolvency Proceeding;

 

(iv)                              Any defense based on any action taken or omitted by the Collateral Agent in any Insolvency Proceeding involving any other Person, including any election to have the Collateral Agent’s claim allowed as being secured, partially secured or unsecured, any extension of credit by the Collateral Agent to any other Person in any Insolvency Proceeding, and the taking and holding by the Collateral Agent of any security for any such extension of credit;

 

(v)                                 All presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, notices of intention to accelerate, notices of acceleration, notices of acceptance of this Agreement or any other Loan Document and of the existence, creation, or incurring of new or additional indebtedness, and demands and notices of every kind (except or expressly required by the Loan Documents); and

 

(vi)                              Except for such notices as required by the Loan Documents, any defense based on or arising out of any defense that the Borrower or any of its affiliates may have to the payment or performance of the Obligations (other than the defense that the Obligations have been paid in full).

 

(c)          (i) After the occurrence and during the continuance of any Event of Default, in its sole discretion, without prior notice (except as required by applicable law) to or consent of any Grantor or any Borrower, the Collateral Agent may elect to:  (A) foreclose against any Collateral for the Secured Obligations, (B) accept any offer to transfer any such Collateral for the Secured Obligations in lieu of foreclosure, (C) compromise or adjust the Secured Obligations or any part thereof or make any other accommodation with any Borrower or any Person, or (D) exercise any other remedy against any Borrower or any person or entity or any collateral for the Secured Obligations.  No such action by the Collateral Agent shall release or limit the Collateral Agent’s rights hereunder or under the other Loan Documents, even if the effect of the action is to deprive Grantor of any subrogation rights, rights of indemnity, or other rights to collect reimbursement from any Borrower or any other Person for any sums paid to the Collateral Agent, whether contractual or arising by operation of law or otherwise.  Each Grantor expressly agrees that under no circumstances shall such Grantor be deemed to have any right, title, interest or claim in or to any real or personal property to be held by the Collateral Agent or any third party after any foreclosure or transfer in lieu of foreclosure of any security for the Secured Obligations in accordance with this Agreement and applicable law.

 

(ii)                                  Subject to the full, final and indefeasible payment of all Secured Obligations to the Collateral Agent, each Grantor shall retain its rights to seek contribution and reimbursement from, and rights of subrogation with respect to, any other Grantor to the extent the Secured Obligations hereunder render such Grantor insolvent.  Such rights of subrogation, contribution and reimbursement shall be subordinate to the Secured Obligations, and no Grantor shall enforce any such rights until the Secured Obligations shall have been finally paid in full.

 

20

 

Section 27.            Execution in Counterparts.  This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of a signature page to this Agreement by telecopier or email (in .pdf or similar electronic format) shall be effective as delivery of an original executed counterpart of this Agreement.

 

Section 28.            The Credit Agreement and the Mortgages.  If any conflict or inconsistency exists between this Agreement and the Credit Agreement, the Credit Agreement shall control and govern to the extent of such inconsistency.  In the event that any of the Collateral hereunder is also subject to a valid and enforceable Lien under the terms of any Mortgage and the terms of such Mortgage are inconsistent with the terms of this Agreement, then with respect to such Collateral, the terms of such Mortgage shall be controlling in the case of fixtures and real estate leases, letting and licenses of, and contracts and agreements relating to the lease of, real property, and the terms of this Agreement shall be controlling in the case of all other Collateral.

 

Section 29.            Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.

 

[Signatures on following pages]

 

21

 

IN WITNESS WHEREOF, each Grantor and the Collateral Agent has caused this Agreement to be duly executed and delivered by its officer thereunto duly authorized as of the date first above written.

 

	
 
    	
CITIBANK, N.A.,
    
	
 
    	
as Collateral Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

[Signatures continue on following pages]

 

SIGNATURE PAGE TO SECURITY AGREEMENT

 

 

	
 
    	
GRANTORS:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FIVE   STAR QUALITY CARE, INC.,
    
	
 
    	
a Maryland corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Chief Financial Officer and Treasurer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FSQ   THE PALMS AT FORT MYERS BUSINESS TRUST, a Maryland business trust
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FVE MW   LLC,
    
	
 
    	
a Maryland limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FSQ   VILLA AT RIVERWOOD BUSINESS TRUST, a Maryland business trust
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
MORNINGSIDE   OF CONCORD, LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    

 

FIVE STAR

AMENDED & RESTATED SECURITY AGREEMENT

 

 

	
 
    	
MORNINGSIDE   OF SPRINGFIELD, LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FIVE STAR   COVINGTON LLC,
    
	
 
    	
a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FVE EC   LLC,
    
	
 
    	
a Maryland limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Richard A. Doyle
    
	
 
    	
 
    	
Title: Treasurer and Chief Financial Officer
    

 

FIVE STAR

AMENDED & RESTATED SECURITY AGREEMENT

 

 

Schedule I to the
 Amended and Restated Security Agreement

 

LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION, JURISDICTION OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER

 

	
Grantor
    	
 
    	
Location
    	
 
    	
Chief
   Executive
   Office
    	
 
    	
Type of
   Organization
    	
 
    	
Jurisdiction
   of
   Organization
    	
 
    	
Organizational
   I.D. No.
    
	
Five Star Quality Care, Inc.(1)
    	
 
    	
400 Centre Street,
   Newton, MA
   02458
    	
 
    	
400 Centre Street,
   Newton, MA
   02458
    	
 
    	
Corporation
    	
 
    	
Maryland
    	
 
    	
D06461743
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FSQ The Palms at Fort Myers Business Trust
    	
 
    	
2674 Winkler Avenue,
   Fort Myers, FL
   33901
    	
 
    	
400 Centre Street,
   Newton, MA 02458
    	
 
    	
Statutory Trust
    	
 
    	
Maryland
    	
 
    	
B06646145
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE MW LLC
    	
 
    	
250 Shenandoah Drive,
   Lafayette, IN
   46062
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Maryland
    	
 
    	
W14490544
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE MW LLC
    	
 
    	
7235 Riverwalk Way North,
   Noblesville, IN
   46062
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Maryland
    	
 
    	
W14490544
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE MW LLC
    	
 
    	
3801 North Wright Road,
   Janesville, WI
   53546
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Maryland
    	
 
    	
W14490544
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FSQ Villa at Riverwood Business Trust
    	
 
    	
No. One Pratt Place, Florissant, MO
   63031
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Statutory Trust
    	
 
    	
Maryland
    	
 
    	
B06646194
    

 

(1)  Effective on or about March 2, 2017, Five Star Quality Care, Inc. will change its name to
 “Five Star Senior Living Inc.”

 

 

	
Grantor
    	
 
    	
Location
    	
 
    	
Chief
   Executive
   Office
    	
 
    	
Type of
   Organization
    	
 
    	
Jurisdiction
   of
   Organization
    	
 
    	
Organizational
   I.D. No.
    
	
Morningside of Concord, LLC
    	
 
    	
190 Fox Hollow Road,
   Pinehurst, NC
   28374
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Delaware
    	
 
    	
3503097
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Morningside of Concord, LLC
    	
 
    	
11230 Ballantyne Trace Court,
   Charlotte, NC 28277
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Delaware
    	
 
    	
3503097
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE EC LLC
    	
 
    	
600 Medical Center Drive, Sewell, NJ
   08080
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Maryland
    	
 
    	
W14490502
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Five Star Covington LLC
    	
 
    	
2601 Covington Commons Drive, Fort Wayne, IN   46804
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Delaware
    	
 
    	
4964950
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Morningside of Springfield, LLC
    	
 
    	
205 Westgate Drive, Springfield, TN 37172
    	
 
    	
400 Centre Street, Newton, MA 02458
    	
 
    	
Limited Liability Company
    	
 
    	
Delaware
    	
 
    	
3499488
    

 

Schedule I

 

 

Schedule II to the
 Amended and Restated Security Agreement

 

BORROWING BASE ASSETS AND LOCATION OF EQUIPMENT AND INVENTORY

 

	
Grantor
    	
 
    	
Borrowing Base
   Asset
    	
 
    	
Locations of
   Equipment
    	
 
    	
Locations of
   Inventory
    
	
FSQ The Palms at Fort Myers Business Trust
    	
 
    	
2674 Winkler Avenue,
   Fort Myers, FL
   33901
    	
 
    	
2674 Winkler Avenue,
   Fort Myers, FL
   33901
    	
 
    	
2674 Winkler Avenue,
   Fort Myers, FL
   33901
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE MW LLC
    	
 
    	
250 Shenandoah Drive,
   Lafayette, IN
   46062
    	
 
    	
250 Shenandoah Drive,
   Lafayette, IN
   46062
    	
 
    	
250 Shenandoah Drive,
   Lafayette, IN
   46062
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE MW LLC
    	
 
    	
7235 Riverwalk Way North, Noblesville, IN
   46062
    	
 
    	
7235 Riverwalk Way North, Noblesville, IN
   46062
    	
 
    	
7235 Riverwalk Way North, Noblesville, IN
   46062
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FSQ Villa at Riverwood Business Trust
    	
 
    	
No. One Pratt Place, Florissant, MO
   63031
    	
 
    	
No. One Pratt Place, Florissant, MO
   63031
    	
 
    	
No. One Pratt Place, Florissant, MO
   63031
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Morningside of Concord, LLC
    	
 
    	
190 Fox Hollow Road, Pinehurst, NC
   28374
    	
 
    	
190 Fox Hollow Road, Pinehurst, NC
   28374
    	
 
    	
190 Fox Hollow Road, Pinehurst, NC
   28374
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Morningside of Concord, LLC
    	
 
    	
11230 Ballantyne Trace Court,
   Charlotte, NC
   28277
    	
 
    	
11230 Ballantyne Trace Court,
   Charlotte, NC
   28277
    	
 
    	
11230 Ballantyne Trace Court,
   Charlotte, NC
   28277
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE EC LLC
    	
 
    	
600 Medical Center Drive, Sewell, NJ
   08080
    	
 
    	
600 Medical Center Drive, Sewell, NJ
   08080
    	
 
    	
600 Medical Center Drive, Sewell, NJ
   08080
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FVE MW LLC
    	
 
    	
3801 North Wright Road, Janesville, WI
   53546
    	
 
    	
3801 North Wright Road, Janesville, WI
   53546
    	
 
    	
3801 North Wright Road, Janesville, WI
   53546
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Five Star Covington LLC
    	
 
    	
2601 Covington Commons Drive, Fort Wayne, IN   46804
    	
 
    	
2601 Covington Commons Drive, Fort Wayne, IN   46804
    	
 
    	
2601 Covington Commons Drive, Fort Wayne, IN   46804
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Morningside of Springfield, LLC
    	
 
    	
205 Westgate Drive, Springfield, TN 37172
    	
 
    	
205 Westgate Drive, Springfield, TN 37172
    	
 
    	
205 Westgate Drive, Springfield, TN 37172
    

 

Schedule II

 

 

Schedule III to the

Amended and Restated Security Agreement

 

CHANGES IN NAME, LOCATION, ETC.

 

1.              Morningside of Concord, LLC

 

Merged with Morningside Holdings of Concord, LLC effective April 13, 2012, with Morningside of Concord, LLC as the Surviving Entity.

 

2.              Five Star Quality Care, Inc.

 

Effective on or about March 2, 2017, Five Star Quality Care, Inc. will change its name to “Five Star Senior Living Inc.”

 

Schedule III

 

 

Exhibit A to the
 Amended and Restated Security Agreement

 

FORM OF SECURITY AGREEMENT SUPPLEMENT

 

[Date of Security Agreement Supplement]

 

To:                             Citibank, N.A., as Collateral Agent
 1615 Brett Road OPS III

New Castle, DE 19720

Attention:  Bank Loan Syndications Department

 

[Name of Borrower]

 

Ladies and Gentlemen:

 

Reference is made to (i) the Amended and Restated Credit Agreement dated as of [             ], 2017 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Five Star Quality Care, Inc., a Maryland corporation, as the Borrower, the Lender Parties party thereto, Citibank, N.A., as collateral agent (together with any successor collateral agent appointed pursuant to Article VIII of the Credit Agreement, the “Collateral Agent”), and Citibank, N. A., as administrative agent for the Lender Parties, and (ii) the Amended and Restated Security Agreement dated [             ], 2017 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Security Agreement”) made by the Grantors from time to time party thereto in favor of the Collateral Agent for the Secured Parties.  Terms defined in the Credit Agreement or the Security Agreement and not otherwise defined herein are used herein as defined in the Credit Agreement or the Security Agreement.

 

SECTION 1.  Grant of Security.  The undersigned hereby grants to the Collateral Agent, for the ratable benefit of the Secured Parties, a security interest in all of its right, title and interest in and to all of the Collateral of the undersigned, whether now owned or hereafter acquired by the undersigned, wherever located and whether now or hereafter existing or arising, including, without limitation, the property and assets of the undersigned set forth on the attached Supplemental Schedules to the Schedules to the Security Agreement.

 

SECTION 2.  Security for Obligations.  The grant of a security interest in, the Collateral by the undersigned under this Security Agreement Supplement and the Security Agreement secures the payment of all Obligations of the undersigned now or hereafter existing under or in respect of the Loan Documents, whether direct or indirect, absolute or contingent, and whether for principal, reimbursement obligations, interest, premiums, penalties, fees, indemnifications, contract causes of action, costs, expenses or otherwise.  Without limiting the generality of the foregoing, this Security Agreement Supplement and the Security Agreement secure the payment of all amounts that constitute part of the Secured Obligations and that would be owed by the undersigned to any Secured Party under the Loan Documents but for the fact that such Secured Obligations are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving a Loan Party.

 

SECTION 3.  Supplements to Security Agreement Schedules.  The undersigned has attached hereto Supplemental Schedules I through III to Schedules I through III respectively, to the

 

Exhibit A-1

 

Security Agreement, and the undersigned hereby certifies, as of the date first above written, that such Supplemental Schedules have been prepared by the undersigned in substantially the form of the equivalent Schedules to the Security Agreement and are complete and correct.

 

SECTION 4.  Representations and Warranties.  The undersigned hereby makes each representation and warranty set forth in Section 8 of the Security Agreement (as supplemented by the attached Supplemental Schedules) to the same extent as each other Grantor.

 

SECTION 5.  Obligations Under the Security Agreement.  The undersigned hereby agrees, as of the date first above written, to be bound as a Grantor by all of the terms and provisions of the Security Agreement to the same extent as each of the other Grantors.  The undersigned further agrees, as of the date first above written, that each reference in the Security Agreement to an “Additional Grantor” or a “Grantor” shall also mean and be a reference to the undersigned.

 

SECTION 6.  Governing Law.  This Security Agreement Supplement shall be governed by, and construed in accordance with, the laws of the State of New York.

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
[NAME OF ADDITIONAL   GRANTOR]
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Address for notices:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
					

 

Exhibit A-2

 

Exhibit G to the

CREDIT AGREEMENT
 Form of Mortgage

 

[AMENDED AND RESTATED] MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS
 AND LEASES AND FIXTURE FILING [(            )]

 

by and from

 

[                  ], “Mortgagor”

 

to

 

CITIBANK, N.A., in its capacity as Agent, “Mortgagee”

 

Dated as of [          ], 2017

 

[insert only if mortgage is capped:  THE MAXIMUM PRINCIPAL INDEBTEDNESS WHICH IS SECURED BY OR WHICH BY ANY CONTINGENCY MAY BE SECURED BY THIS MORTGAGE IS $               .]

 

	
 
    	
Location:
    	
[                ]
    
	
 
    	
Municipality:
    	
[                ]
    
	
 
    	
County:
    	
[                ]
    
	
 
    	
State:
    	
[                ]
    

 

THE SECURED PARTY (MORTGAGEE) DESIRES THIS FIXTURE FILING
 TO BE INDEXED AGAINST THE RECORD OWNER OF THE REAL ESTATE
 DESCRIBED HEREIN.

 

PREPARED BY, RECORDING REQUESTED BY,
 AND WHEN RECORDED MAIL TO:

 

Shearman & Sterling LLP
 599 Lexington Avenue
 New York, New York  10022-6069
 Attention: Malcolm K. Montgomery, Esq.
 File #31900-00396

 

 

[AMENDED AND RESTATED] MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND LEASES AND FIXTURE FILING ([            ])

 

THIS [AMENDED AND RESTATED] MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND LEASES AND FIXTURE FILING ([             ]) (this “Mortgage”) is dated as of [          ], 2012 by and from [                   ] (“Mortgagor”), whose address is c/o Five Star Quality Care, Inc., 400 Centre Street, Newton, Massachusetts 02458 to Citibank, N.A., a national association, as collateral agent (in such capacity, “Agent”) for the Secured Parties as defined in the Credit Agreement (defined below), having an address at 1615 Brett Road OPS III, New Castle, DE 19720, Attention: Bank Loan Syndications Department (Agent, together with its successors and assigns, “Mortgagee”).

 

[insert only if mortgage is capped:  ANY PROVISION HEREIN TO THE CONTRARY NOTWITHSTANDING, THE MAXIMUM PRINCIPAL INDEBTEDNESS WHICH IS SECURED BY OR WHICH BY ANY CONTINGENCY MAY BE SECURED BY THIS MORTGAGE IS $[           ] (THE “SECURED AMOUNT”).]

 

[W I T N E S S E T H:

 

WHEREAS, pursuant to that certain Credit Agreement dated as of April 13, 2012 among Borrower (as defined below), the guarantors party thereto, the lenders party thereto, and the Agent (the “Existing Credit Agreement”), the lenders party thereto agreed to extend certain commitments to make certain extensions of credit available to Borrower; and

 

WHEREAS, in connection with the execution of the Existing Credit Agreement, Mortgagor executed that certain [Mortgage][Deed of Trust], Security Agreement, Assignment of Rents and Leases and Fixture Filing ([      ]), dated as of April 13, 2012, in favor of Mortgagee (the “Existing Mortgage”)[ and recorded on [          ] in the Official Records of [          ] County, [          ], as Instrument No. [          ], Book [          ], Page [          ]]; and

 

WHEREAS, Borrower, the Guarantors, Agent and the lenders party to the Existing Credit Agreement desire to amend and restate the Existing Credit Agreement to make certain amendments thereto, and in connection therewith desire to amend and restate the Existing Mortgage to make certain amendments thereto;

 

NOW, THEREFORE, in consideration of the recitals set forth above, which by this reference are incorporated into the operative provisions of this Mortgage, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and subject to the terms and conditions hereof and on the basis of the representations and warranties set forth herein and in the Credit Agreement (as defined below), the parties hereby agree to amend and restate the Existing Mortgage to read in its entirety as herein set forth. — Insert only if mortgage is being amended and restated for existing collateral asset]

 

ARTICLE 1
 Definitions

 

Section 1.1            Definitions.  All capitalized terms used herein without definition shall have the respective meanings ascribed to them in that certain Amended and Restated Credit Agreement dated as of even date herewith, as the same may be amended, amended and restated, supplemented or otherwise modified from time to time (the “Credit Agreement”), among Five Star Quality Care, Inc. (“Borrower”), the Guarantors party thereto, the Lender Parties party thereto, Citibank, N.A., as Collateral

 

2

 

Agent and as Administrative Agent, the other Secured Parties identified therein and the Arrangers party thereto.  As used herein, the following terms shall have the following meanings:

 

(a)   “Event of Default”:  An Event of Default under and as defined in the Credit Agreement .

 

(b)   “Guaranty”:  That certain guaranty provided pursuant to Article VII of the Credit Agreement and any Guaranty Supplement by and from Mortgagor and the other Guarantors referred to therein for the benefit of the Secured Parties dated as of even date herewith, as the same may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time.

 

(c)   “Indebtedness”:  (1) All indebtedness of Mortgagor to Mortgagee or any of the other Secured Parties under the Credit Agreement or any other Loan Document to which Mortgagor is a party, including, without limitation (except as otherwise set forth in 7.01(b) of the Credit Agreement), the sum of all (a) principal, interest and other amounts owing under or evidenced or secured by the Loan Documents, (b) principal, interest and other amounts which may hereafter be lent by Mortgagee or any of the other Secured Parties under or in connection with the Credit Agreement or any of the other Loan Documents, whether evidenced by a promissory note or other instrument which, by its terms, is secured hereby, and (c) obligations and liabilities of any nature now or hereafter existing under or arising in connection with Letters of Credit and other extensions of credit under the Credit Agreement or any of the other Loan Documents and reimbursement obligations in respect thereof, together with interest and other amounts payable with respect thereto, and (2) all other indebtedness, obligations and liabilities now or hereafter existing of any kind of Mortgagor to Mortgagee or any of the other Secured Parties under documents which recite that they are intended to be secured by this Mortgage.  The Indebtedness secured hereby includes, without limitation, all interest and expenses accruing after the commencement by or against Mortgagor or any of its affiliates of a proceeding under the Bankruptcy Code (defined below) or any similar law for the relief of debtors.  The Credit Agreement contains a revolving credit facility which permits Borrower to borrow certain principal amounts, repay all or a portion of such principal amounts, and reborrow the amounts previously paid to the Secured Parties, all upon satisfaction of certain conditions stated in the Credit Agreement.  [use only if mortgage is capped:  Subject to the provisions of Section 2.2, this]  [This] Mortgage secures all advances and re-advances under the Credit Agreement, including, without limitation, those under the revolving credit facility contained therein.

 

(d)   “Mortgaged Property”:  The fee interest in the real property described in Exhibit A attached hereto and incorporated herein by this reference, together with any greater estate therein as hereafter may be acquired by Mortgagor (the “Land”), and all of Mortgagor’s right, title and interest now or hereafter acquired in and to (1) all improvements now owned or hereafter acquired by Mortgagor, now or at any time situated, placed or constructed upon the Land (the “Improvements”; the Land and Improvements are collectively referred to as the “Premises”), (2) all materials, supplies, equipment, apparatus and other items of personal property now owned or hereafter acquired by Mortgagor and now or hereafter attached to, installed in or used in connection with any of the Improvements or the Land, and water, gas, electrical, telephone, storm and sanitary sewer facilities and all other utilities whether or not situated in easements, and all equipment, inventory and other goods in which Mortgagor now has or hereafter acquires any rights or any power to transfer rights and that are or are to become fixtures (as defined in the UCC, defined below) related to the Land  (the “Fixtures”), (3) all goods, accounts, inventory, general intangibles, instruments, documents, contract rights and chattel paper, including all such items as defined in the UCC, now owned or hereafter acquired by Mortgagor and now or hereafter affixed to, placed upon, used in connection with, arising from or otherwise related to the Premises (the “Personalty”), (4) all reserves, escrows or impounds required under the Credit Agreement or any of the other Loan Documents and all deposit accounts maintained by Mortgagor with respect to the Mortgaged Property (the “Deposit Accounts”), (5) all leases, licenses, concessions, occupancy agreements or other

 

3

 

agreements (written or oral, now or at any time in effect) which grant to any Person a possessory interest in, or the right to use, all or any part of the Mortgaged Property, together with all related security and other deposits (the “Leases”), (6) all of the rents, revenues, royalties, income, proceeds, profits, accounts receivable, security and other types of deposits, and other benefits paid or payable by parties to the Leases for using, leasing, licensing possessing, operating from, residing in, selling or otherwise enjoying the Mortgaged Property (the “Rents”), (7) all other agreements, such as construction contracts, architects’ agreements, engineers’ contracts, utility contracts, maintenance agreements, management agreements, service contracts, listing agreements, guaranties, warranties, permits, licenses, certificates and entitlements in any way relating to the construction, use, occupancy, operation, maintenance, enjoyment or ownership of the Mortgaged Property (the “Property Agreements”), (8) all rights, privileges, tenements, hereditaments, rights-of-way, easements, appendages and appurtenances appertaining to the foregoing, (9) all property tax refunds payable with respect to the Mortgaged Property (the “Tax Refunds”), (10) all accessions, replacements and substitutions for any of the foregoing and all proceeds thereof (the “Proceeds”), (11) all insurance policies, unearned premiums therefor and proceeds from such policies covering any of the above property now or hereafter acquired by Mortgagor (the “Insurance”), and (12) all awards, damages, remunerations, reimbursements, settlements or compensation heretofore made or hereafter to be made by any governmental authority pertaining to any condemnation or other taking (or any purchase in lieu thereof) of all or any portion of the Land, Improvements, Fixtures or Personalty (the “Condemnation Awards”).  As used in this Mortgage, the term “Mortgaged Property” shall mean all or, where the context permits or requires, any portion of the above or any interest therein.

 

(e)   “Obligations”:  All of the agreements, covenants, conditions, warranties, representations and other obligations of Mortgagor under the Credit Agreement and the other Loan Documents to which it is a party.

 

(f)    “Permitted Liens”: Permitted Liens under and as defined in the Credit Agreement .

 

(g)   “Security Agreement”:  That certain Amended and Restated Security Agreement by and from Mortgagor and the other grantors referred to therein to Agent and the other Secured Parties dated of even date herewith, as the same may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time.

 

(h)   “UCC”:  The Uniform Commercial Code of the State of [            ] or, if the creation, perfection and enforcement of any security interest herein granted is governed by the laws of a state other than the State of [             ], then, as to the matter in question, the Uniform Commercial Code in effect in that state.

 

ARTICLE 2
 GRANT[INSERT ONLY IF MORTGAGE IS CAPPED:  ; REVOLVING LOAN]

 

Section 2.1            Grant.  To secure the full and timely payment of the Indebtedness and the full and timely performance of the Obligations, Mortgagor MORTGAGES, GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and CONFIRMS, to Mortgagee the Mortgaged Property, subject, however, only to the matters that are set forth on Exhibit B attached hereto (the “Permitted Encumbrances”) and to Permitted Liens, TO HAVE AND TO HOLD the Mortgaged Property to Mortgagee, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property unto Mortgagee.

 

Section 2.2            Treatment of Borrowings and Repayments.  [insert only if mortgage is capped:  Pursuant to the Credit Agreement, the amount of the Indebtedness may increase and decrease from time to time as the Secured Parties advance, Borrower repays, and the Secured Parties re-advance

 

4

 

sums pursuant to the Credit Agreement.  For purposes of this Mortgage, so long as the balance of the Indebtedness equals or exceeds the Secured Amount, the amount of the Indebtedness secured by this Mortgage shall at all times equal only the Secured Amount.  Such Secured Amount represents only a portion of the first sums advanced by the Secured Parties in respect of the Indebtedness.

 

Section 2.3            Reduction of Secured Amount.  [insert only if mortgage is capped:  The Secured Amount shall be reduced only by the last and final sums that Borrower repays with respect to the Indebtedness and shall not be reduced by any intervening repayments of the Indebtedness.  So long as the balance of the Indebtedness exceeds the Secured Amount, any payments and repayments of the Indebtedness shall not be deemed to be applied against, or to reduce, the portion of the Indebtedness secured by this Mortgage.  Such payments shall instead be deemed to reduce only such portions of the Indebtedness as are secured by other collateral located outside of the State of [              ].

 

ARTICLE 3
 WARRANTIES, REPRESENTATIONS AND COVENANTS

 

Mortgagor warrants, represents and covenants to Mortgagee as follows:

 

Section 3.1            Title to Mortgaged Property and Lien of this Instrument.  Mortgagor owns the Mortgaged Property free and clear of any liens, claims or interests, except the Permitted Encumbrances and the Permitted Liens.  This Mortgage creates valid, enforceable first priority liens and security interests against the Mortgaged Property.

 

Section 3.2            First Lien Status.  Mortgagor shall preserve and protect the first lien and security interest status of this Mortgage and the other Loan Documents.  If any lien or security interest other than a Permitted Encumbrance or a Permitted Lien is asserted against the Mortgaged Property, Mortgagor shall promptly, and at its expense, (a) give Mortgagee a detailed written notice of such lien or security interest (including origin, amount and other terms), and (b) pay the underlying claim in full or take such other action so as to cause it to be released or contest the same in compliance with the requirements of the Credit Agreement (including the requirement of providing a bond or other security satisfactory to Mortgagee).

 

Section 3.3            Payment and Performance.  Mortgagor shall pay the Indebtedness when due under the Credit Agreement and the other Loan Documents and shall perform the Obligations in full when they are required to be performed.

 

Section 3.4            Replacement of Fixtures and Personalty.  Mortgagor shall not, without the prior written consent of Mortgagee, permit any of the Fixtures or Personalty owned or leased by Mortgagor to be removed at any time from the Land or Improvements, unless the removed item is removed temporarily for maintenance and repair, is replaced by an item of equal or better quality or is permitted to be removed (or otherwise disposed of) under the Credit Agreement.

 

Section 3.5            Inspection.  Mortgagor shall permit Mortgagee and the other Secured Parties, and their respective agents, representatives and employees, upon reasonable prior notice to Mortgagor, to inspect the Mortgaged Property and all books and records of Mortgagor located thereon, and to conduct such environmental and engineering studies as Mortgagee or the other Secured Parties may require, provided that such inspections and studies shall not materially interfere with the use and operation of the Mortgaged Property; provided, however, that Mortgagee or the other Secured Parties shall only request additional environmental studies (i) upon a reasonable determination that prohibited environmental activities or conditions exist in connection with the Mortgaged Property, or (ii) following the occurrence and during the continuance of any Event of Default.

 

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Section 3.6            Other Covenants.  All of the covenants in the Credit Agreement are incorporated herein by reference and, together with covenants in this Article 3, shall be covenants running with the Land.

 

Section 3.7            Insurance; Condemnation Awards and Insurance Proceeds.

 

(a)   Insurance.  Mortgagor shall maintain or cause to be maintained, with financially sound and reputable insurers, insurance with respect to the Mortgaged Property in compliance with the requirements set forth on Schedule I attached hereto.

 

(b)   Condemnation Awards.  Mortgagor assigns all Condemnation Awards to Mortgagee and authorizes Mortgagee to collect and receive such Condemnation Awards and to give proper receipts and acquittances therefor, subject to the terms of the Credit Agreement and the applicable provisions of Schedule I attached hereto.

 

(c)   Insurance Proceeds.  Mortgagor assigns to Mortgagee all proceeds of any insurance policies insuring against loss or damage to the Mortgaged Property.  Subject to the terms of the Credit Agreement and the applicable provisions of Schedule I attached hereto, Mortgagor authorizes Mortgagee to collect and receive such proceeds and authorizes and directs the issuer of each of such insurance policies to make payment for all such losses directly to Mortgagee, instead of to Mortgagor and Mortgagee jointly.

 

ARTICLE 4
  [INTENTIONALLY OMITTED]

 

ARTICLE 5
 DEFAULT AND FORECLOSURE

 

Section 5.1            Remedies.  Upon the occurrence and during the continuance of an Event of Default, Mortgagee may, at Mortgagee’s election, exercise any or all of the following rights, remedies and recourses:

 

(a)   Acceleration.  Subject to any provisions of the Loan Documents providing for the automatic acceleration of the Indebtedness upon the occurrence of certain Events of Default, declare the Indebtedness to be immediately due and payable, without further notice, presentment, protest, notice of intent to accelerate, notice of acceleration, demand or action of any nature whatsoever (each of which hereby is expressly waived by Mortgagor), whereupon the same shall become immediately due and payable.

 

(b)   Entry on Mortgaged Property.  Enter the Mortgaged Property and take exclusive possession thereof and of all books, records and accounts relating thereto or located thereon.  If Mortgagor remains in possession of the Mortgaged Property following the occurrence and during the continuance of an Event of Default and without Mortgagee’s prior written consent, Mortgagee may invoke any legal remedies to dispossess Mortgagor.

 

(c)   Operation of Mortgaged Property.  Hold, lease, develop, manage, operate or otherwise use the Mortgaged Property upon such terms and conditions as Mortgagee may deem reasonable under the circumstances (making such repairs, alterations, additions and improvements and taking other actions, from time to time, as Mortgagee deems necessary or desirable), and apply all Rents

 

6

 

and other amounts collected by Mortgagee in connection therewith in accordance with the provisions of Section 5.7.

 

(d)   Foreclosure and Sale.  Institute proceedings for the complete foreclosure of this Mortgage by judicial action or by power of sale, in which case the Mortgaged Property may be sold for cash or credit in one or more parcels.  With respect to any notices required or permitted under the UCC, Mortgagor agrees that ten (10) days’ prior written notice shall be deemed commercially reasonable.  At any such sale by virtue of any judicial proceedings, power of sale, or any other legal right, remedy or recourse, the title to and right of possession of any such property shall pass to the purchaser thereof, and to the fullest extent permitted by law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, claim, equity, equity of redemption, and demand whatsoever, either at law or in equity, in and to the property sold and such sale shall be a perpetual bar both at law and in equity against Mortgagor, and against all other Persons claiming or to claim the property sold or any part thereof, by, through or under Mortgagor.  Mortgagee or any of the other Secured Parties may be a purchaser at such sale.  If Mortgagee or such other Secured Party is the highest bidder, Mortgagee or such other Secured Party may credit the portion of the purchase price that would be distributed to Mortgagee or such other Secured Party against the Indebtedness in lieu of paying cash.  In the event this Mortgage is foreclosed by judicial action, appraisement of the Mortgaged Property is waived.

 

(e)   Receiver.  Make application to a court of competent jurisdiction for, and obtain from such court as a matter of strict right and without notice to Mortgagor or regard to the adequacy of the Mortgaged Property for the repayment of the Indebtedness, the appointment of a receiver of the Mortgaged Property, and Mortgagor irrevocably consents to such appointment.  Any such receiver shall have all the usual powers and duties of receivers in similar cases, including the full power to rent, maintain and otherwise operate the Mortgaged Property upon such terms as may be approved by the court, and shall apply such Rents in accordance with the provisions of Section 5.7.

 

(f)    Other.  Exercise all other rights, remedies and recourses granted under the Loan Documents or otherwise available at law or in equity.

 

Section 5.2            Separate Sales.  The Mortgaged Property may be sold in one or more parcels and in such manner and order as Mortgagee in its sole discretion may elect.  The right of sale arising out of any Event of Default shall not be exhausted by any one or more sales.

 

Section 5.3            Remedies Cumulative, Concurrent and Nonexclusive.  Mortgagee and the other Secured Parties shall have all rights, remedies and recourses granted in the Loan Documents and available at law or equity (including the UCC), which rights (a) shall be cumulative and concurrent, (b) may be pursued separately, successively or concurrently against Mortgagor or others obligated under the Loan Documents, or against the Mortgaged Property, or against any one or more of them, at the sole discretion of Mortgagee or such other Secured Party, as the case may be, (c) may be exercised as often as occasion therefor shall arise, and the exercise or failure to exercise any of them shall not be construed as a waiver or release thereof or of any other right, remedy or recourse, and (d) are intended to be, and shall be, nonexclusive.  No action by Mortgagee or any other Secured Party in the enforcement of any rights, remedies or recourses under the Loan Documents or otherwise at law or equity shall be deemed to cure any Event of Default.

 

Section 5.4            Release of and Resort to Collateral.  Mortgagee may release, regardless of consideration and without the necessity for any notice to or consent by the holder of any subordinate lien on the Mortgaged Property, any part of the Mortgaged Property without, as to the remainder, in any way impairing, affecting, subordinating or releasing the lien or security interest created in or evidenced by the Loan Documents or their status as a first and prior lien and security interest in and

 

7

 

to the Mortgaged Property.  For payment of the Indebtedness, Mortgagee may resort to any other security in such order and manner as Mortgagee may elect.

 

Section 5.5            Waiver of Redemption, Notice and Marshalling of Assets.  To the fullest extent permitted by law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefit that might accrue to Mortgagor by virtue of any present or future statute of limitations or law or judicial decision exempting the Mortgaged Property from attachment, levy or sale on execution or providing for any stay of execution, exemption from civil process, redemption or extension of time for payment, (b) all notices of any Event of Default or of Mortgagee’s election to exercise or the actual exercise of any right, remedy or recourse provided for under the Loan Documents, and (c) any right to a marshalling of assets or a sale in inverse order of alienation.

 

Section 5.6            Discontinuance of Proceedings.  If Mortgagee or any other Secured Party shall have proceeded to invoke any right, remedy or recourse permitted under the Loan Documents and shall thereafter elect to discontinue or abandon it for any reason, Mortgagee or such other Secured Party, as the case may be, shall have the unqualified right to do so and, in such an event, Mortgagor, Mortgagee and the other Secured Parties shall be restored to their former positions with respect to the Indebtedness, the Obligations, the Loan Documents, the Mortgaged Property and otherwise, and the rights, remedies, recourses and powers of Mortgagee and the other Secured Parties shall continue as if the right, remedy or recourse had never been invoked, but no such discontinuance or abandonment shall waive any Event of Default which may then exist or the right of Mortgagee or any other Secured Party thereafter to exercise any right, remedy or recourse under the Loan Documents for such Event of Default.

 

Section 5.7            Application of Proceeds.  The proceeds of any sale of, and the Rents and other amounts generated by the holding, leasing, management, operation or other use of the Mortgaged Property, shall be applied by Mortgagee (or the receiver, if one is appointed) in the following order unless otherwise required by applicable law:

 

(a)   to the payment of the costs and expenses of taking possession of the Mortgaged Property and of holding, using, leasing, repairing, improving and selling the same, including, without limitation (1) receiver’s fees and expenses, including the repayment of the amounts evidenced by any receiver’s certificates, (2) court costs, (3) attorneys’ and accountants’ fees and expenses, and (4) costs of advertisement;

 

(b)   to the payment of the Indebtedness and performance of the Obligations in such manner and order of preference as Mortgagee in its sole discretion may determine; and

 

(c)   the balance, if any, to the Persons legally entitled thereto.

 

Section 5.8            Occupancy After Foreclosure.  Any sale of the Mortgaged Property or any part thereof in accordance with Section 5.1(d) will divest all right, title and interest of Mortgagor in and to the property sold.  Subject to applicable law, any purchaser at a foreclosure sale will receive immediate possession of the property purchased.  If Mortgagor retains possession of such property or any part thereof subsequent to such sale, Mortgagor will be considered a tenant at sufferance of the purchaser, and will, if Mortgagor remains in possession after demand to remove, be subject to eviction and removal, forcible or otherwise, with or without process of law.

 

Section 5.9            Additional Advances and Disbursements; Costs of Enforcement.

 

(a)   Upon the occurrence and during the continuance of any Event of Default, Mortgagee and each of the other Secured Parties shall have the right, but not the obligation, to cure such Event of

 

8

 

Default in the name and on behalf of Mortgagor.  All sums advanced and expenses incurred at any time by Mortgagee or any other Secured Party under this Section 5.9, or otherwise under this Mortgage or any of the other Loan Documents or applicable law, shall bear interest from the date that such sum is advanced or expense incurred, to and including the date of reimbursement, computed at the highest rate at which interest is then computed on any portion of the Indebtedness, and all such sums, together with interest thereon, shall be secured by this Mortgage.

 

(b)   Mortgagor shall pay all expenses (including reasonable attorneys’ fees and expenses) of or incidental to the perfection and enforcement of this Mortgage and the other Loan Documents, or the enforcement, compromise or settlement of the Indebtedness or any claim under this Mortgage and the other Loan Documents, and for the curing thereof, or for defending or asserting the rights and claims of Mortgagee in respect thereof, by litigation or otherwise.

 

Section 5.10         No Mortgagee in Possession.  Neither the enforcement of any of the remedies under this Article 5, the assignment of the Rents and Leases under Article 6, the security interests under Article 7, nor any other remedies afforded to Mortgagee under the Loan Documents, at law or in equity shall cause Mortgagee or any other Secured Party to be deemed or construed to be a mortgagee in possession of the Mortgaged Property, to obligate Mortgagee or any other Secured Party to lease the Mortgaged Property or attempt to do so, or to take any action, incur any expense, or perform or discharge any obligation, duty or liability whatsoever under any of the Leases or otherwise.

 

ARTICLE 6
 ASSIGNMENT OF RENTS AND LEASES

 

Section 6.1            Assignment.  In furtherance of and in addition to the assignment made by Mortgagor in Section 2.1 of this Mortgage, Mortgagor hereby absolutely and unconditionally assigns, sells, transfers and conveys to Mortgagee all of its right, title and interest in and to all Leases, whether now existing or hereafter entered into, and all of its right, title and interest in and to all Rents.  This assignment is an absolute assignment and not an assignment for additional security only.  So long as no Event of Default shall have occurred and be continuing, Mortgagor shall have a revocable license from Mortgagee to exercise all rights extended to the landlord under the Leases, including the right to receive and collect all Rents and to hold the Rents in trust for use in the payment and performance of the Obligations and to otherwise use the same.  The foregoing license is granted subject to the conditional limitation that no Event of Default shall have occurred and be continuing.  Upon the occurrence and during the continuance of an Event of Default, whether or not legal proceedings have commenced, and without regard to waste, adequacy of security for the Obligations or solvency of Mortgagor, the license herein granted shall automatically expire and terminate, without notice to Mortgagor by Mortgagee (any such notice being hereby expressly waived by Mortgagor to the extent permitted by applicable law).

 

Section 6.2            Perfection Upon Recordation.  Mortgagor acknowledges that Mortgagee has taken all actions necessary to obtain, and that upon recordation of this Mortgage Mortgagee shall have, to the extent permitted under applicable law, a valid and fully perfected, first priority, present assignment of the Rents arising out of the Leases and all security for such Leases.  Mortgagor acknowledges and agrees that upon recordation of this Mortgage Mortgagee’s interest in the Rents shall be deemed to be fully perfected, “choate” and enforced as to Mortgagor and  to the extent permitted under applicable law, all third parties, including, without limitation, any subsequently appointed trustee in any case under Title 11 of the United States Code (the “Bankruptcy Code”), without the necessity of commencing a foreclosure action with respect to this Mortgage, making formal demand for the Rents, obtaining the appointment of a receiver or taking any other affirmative action.

 

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Section 6.3            Bankruptcy Provisions.  Without limitation of the absolute nature of the assignment of the Rents hereunder, Mortgagor and Mortgagee agree that (a) this Mortgage shall constitute a “security agreement” for purposes of Section 552(b) of the Bankruptcy Code, (b) the security interest created by this Mortgage extends to property of Mortgagor acquired before the commencement of a case in bankruptcy and to all amounts paid as Rents and (c) such security interest shall extend to all Rents acquired by the estate after the commencement of any case in bankruptcy.

 

Section 6.4            No Merger of Estates.  So long as part of the Indebtedness and the Obligations secured hereby remain unpaid and undischarged, the fee and leasehold estates to the Mortgaged Property shall not merge, but shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Mortgagee, any tenant or any third party by purchase or otherwise.

 

ARTICLE 7
 SECURITY AGREEMENT

 

Section 7.1            Security Interest.  This Mortgage constitutes a “security agreement” on personal property within the meaning of the UCC and other applicable law and with respect to the Personalty, Fixtures, Leases, Rents, Deposit Accounts, Property Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards.  To this end, Mortgagor grants to Mortgagee a first and prior security interest in the Personalty, Fixtures, Leases, Rents, Deposit Accounts, Property Agreements, Tax Refunds, Proceeds, Insurance, Condemnation Awards and all other Mortgaged Property which is personal property to secure the payment of the Indebtedness and performance of the Obligations, and agrees that Mortgagee shall have all the rights and remedies of a secured party under the UCC with respect to such property.  Any notice of sale, disposition or other intended action by Mortgagee with respect to the Personalty, Fixtures, Leases, Rents, Deposit Accounts, Property Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards sent to Mortgagor at least ten (10) days prior to any action under the UCC shall constitute reasonable notice to Mortgagor.  In the event of any conflict or inconsistency between the terms of this Mortgage and the terms of the Security Agreement with respect to the collateral covered both therein and herein, the Security Agreement shall control and govern to the extent of any such conflict or inconsistency.

 

Section 7.2            Financing Statements.  Mortgagor shall prepare and deliver to Mortgagee such financing statements, and shall execute and deliver to Mortgagee such documents, instruments and further assurances, in each case in form and substance satisfactory to Mortgagee, as Mortgagee may, from time to time, reasonably consider necessary to create, perfect and preserve Mortgagee’s security interest hereunder.  Mortgagor hereby irrevocably authorizes Mortgagee to cause financing statements (and amendments thereto and continuations thereof) and any such documents, instruments and assurances to be recorded and filed, at such times and places as may be required or permitted by law to so create, perfect and preserve such security interest.  Mortgagor represents and warrants to Mortgagee that Mortgagor’s jurisdiction of organization is the State of [         ].  After the date of this Mortgage, Mortgagor shall not change its name, type of organization, organizational identification number (if any), jurisdiction of organization or location (within the meaning of the UCC) without giving at least thirty (30) days’ prior written notice to Mortgagee.

 

Section 7.3            Fixture Filing.  This Mortgage shall also constitute a “fixture filing” for the purposes of the UCC against all of the Mortgaged Property which is or is to become fixtures.  The information provided in this Section 7.3 is provided so that this Mortgage shall comply with the requirements of the UCC for a mortgage instrument to be filed as a financing statement.  Mortgagor is the “Debtor” and its name and mailing address are set forth in the preamble of this Mortgage immediately preceding Article 1.  Mortgagee is the “Secured Party” and its name and mailing address from which information concerning the security interest granted herein may be obtained are also set forth in the

 

10

 

preamble of this Mortgage immediately preceding Article 1.  A statement describing the portion of the Mortgaged Property comprising the fixtures hereby secured is set forth in Section 1.1(d) of this Mortgage. Mortgagor represents and warrants to Mortgagee that Mortgagor is the record owner of the Mortgaged Property.

 

ARTICLE 8
  [INTENTIONALLY OMITTED]

 

ARTICLE 9
 MISCELLANEOUS

 

Section 9.1            Notices.  Any notice required or permitted to be given under this Mortgage shall be given in accordance with Section 9.02 of the Credit Agreement.

 

Section 9.2            Covenants Running with the Land.  All Obligations contained in this Mortgage are intended by Mortgagor and Mortgagee to be, and shall be construed as, covenants running with the Land.  As used herein, “Mortgagor” shall refer to the party named in the first paragraph of this Mortgage and to any subsequent owner of all or any portion of the Mortgaged Property.  All Persons who may have or acquire an interest in the Mortgaged Property shall be deemed to have notice of, and be bound by, the terms of the Credit Agreement and the other Loan Documents; provided, however, that no such party shall be entitled to any rights thereunder without the prior written consent of Mortgagee.

 

Section 9.3            Attorney-in-Fact.  Mortgagor hereby irrevocably appoints Mortgagee as its attorney-in-fact, which agency is coupled with an interest and with full power of substitution, with full authority in the place and stead of Mortgagor and in the name of Mortgagor or otherwise (a) to execute and/or record any notices of completion, cessation of labor or any other notices that Mortgagee deems appropriate to protect Mortgagee’s interest, if Mortgagor shall fail to do so within ten (10) days after written request by Mortgagee, (b) upon the issuance of a deed pursuant to the foreclosure of this Mortgage or the delivery of a deed in lieu of foreclosure, to execute all instruments of assignment, conveyance or further assurance with respect to the Leases, Rents, Deposit Accounts, Property Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards in favor of the grantee of any such deed and as may be necessary or desirable for such purpose, (c) to prepare and file or record financing statements and continuation statements, and to prepare, execute and file or record applications for registration and like papers necessary to create, perfect or preserve Mortgagee’s security interests and rights in or to any of the Mortgaged Property, and (d) after the occurrence and during the continuance of any Event of Default, to perform any obligation of Mortgagor hereunder; provided, however, that (1) Mortgagee shall not under any circumstances be obligated to perform any obligation of Mortgagor; (2) any sums advanced by Mortgagee in such performance shall be added to and included in the Indebtedness and shall bear interest at the highest rate at which interest is then computed on any portion of the Indebtedness; (3) Mortgagee as such attorney-in-fact shall only be accountable for such funds as are actually received by Mortgagee; and (4) Mortgagee shall not be liable to Mortgagor or any other person or entity for any failure to take any action which it is empowered to take under this Section 9.3.

 

Section 9.4            Successors and Assigns.  This Mortgage shall be binding upon and inure to the benefit of Mortgagee, the other Secured Parties, and Mortgagor and their respective successors and assigns.  Except as permitted by the Credit Agreement, Mortgagor shall not, without the prior written consent of Mortgagee, assign any rights, duties or obligations hereunder.

 

Section 9.5            No Waiver.  Any failure by Mortgagee or the other Secured Parties to insist upon strict performance of any of the terms, provisions or conditions of the Loan Documents shall

 

11

 

not be deemed to be a waiver of same, and Mortgagee and the other Secured Parties shall have the right at any time to insist upon strict performance of all of such terms, provisions and conditions.

 

Section 9.6            Credit Agreement.  If any conflict or inconsistency exists between this Mortgage and the Credit Agreement, the Credit Agreement shall control and govern to the extent of any such conflict or inconsistency.

 

Section 9.7            Release or Reconveyance.  Upon payment in full of the Indebtedness and performance in full of the Obligations, upon a sale or other disposition of the Mortgaged Property permitted by the Credit Agreement, or otherwise as provided in the Credit Agreement, Mortgagee, at Mortgagor’s request and expense, shall release the liens and security interests created by this Mortgage or reconvey the Mortgaged Property to Mortgagor.

 

Section 9.8            Waiver of Stay, Moratorium and Similar Rights.  Mortgagor agrees, to the full extent that it may lawfully do so, that it will not at any time insist upon or plead or in any way take advantage of any stay, marshalling of assets, extension, redemption or moratorium law now or hereafter in force and effect so as to prevent or hinder the enforcement of the provisions of this Mortgage or the Indebtedness or Obligations secured hereby, or any agreement between Mortgagor and Mortgagee or any rights or remedies of Mortgagee or any other Secured Party.

 

Section 9.9            Applicable Law.  The provisions of this Mortgage regarding the creation, perfection and enforcement of the liens and security interests herein granted shall be governed by and construed under the laws of the state in which the Mortgaged Property is located.  All other provisions of this Mortgage shall be governed by the laws of the State of New York (including, without limitation, Section 5-1401 of the General Obligations Law of the State of New York).

 

Section 9.10         Headings.  The Article, Section and Subsection titles hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections.

 

Section 9.11         Severability.  If any provision of this Mortgage shall be held by any court of competent jurisdiction to be unlawful, void or unenforceable for any reason, such provision shall be deemed severable from and shall in no way affect the enforceability and validity of the remaining provisions of this Mortgage.

 

Section 9.12         Entire Agreement.  This Mortgage and the other Loan Documents embody the entire agreement and understanding between Mortgagee and Mortgagor relating to the subject matter hereof and thereof and supersede all prior agreements and understandings between such parties relating to the subject matter hereof and thereof.  Accordingly, the Loan Documents may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties.  There are no unwritten oral agreements between the parties.

 

Section 9.13         Mortgagee as Agent; Successor Agents.

 

(a)   Agent has been appointed to act as Agent hereunder by the other Secured Parties.  Agent shall have the right hereunder to make demands, to give notices, to exercise or refrain from exercising any rights, and to take or refrain from taking any action (including, without limitation, the release or substitution of the Mortgaged Property) in accordance with the terms of the Credit Agreement, any related agency agreement among Agent and the other Secured Parties (collectively, as amended, amended and restated, supplemented or otherwise modified or replaced from time to time, the “Agency Documents”) and this Mortgage.  Mortgagor and all other Persons shall be entitled to rely on releases,

 

12

 

waivers, consents, approvals, notifications and other acts of Agent, without inquiry into the existence of required consents or approvals of the Secured Parties therefor.

 

(b)   Mortgagee shall at all times be the same Person that is Agent under the Agency Documents.  Written notice of resignation by Agent pursuant to the Agency Documents shall also constitute notice of resignation as Agent under this Mortgage.  Removal of Agent pursuant to any provision of the Agency Documents shall also constitute removal as Agent under this Mortgage.  Appointment of a successor Agent pursuant to the Agency Documents shall also constitute appointment of a successor Agent under this Mortgage.  Upon the acceptance of any appointment as Agent by a successor Agent under the Agency Documents, that successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring or removed Agent as the Mortgagee under this Mortgage, and the retiring or removed Agent shall promptly (i) assign and transfer to such successor Agent all of its right, title and interest in and to this Mortgage and the Mortgaged Property, and (ii) execute and deliver to such successor Agent such assignments and amendments and take such other actions, as may be necessary or appropriate in connection with the assignment to such successor Agent of the liens and security interests created hereunder, whereupon such retiring or removed Agent shall be discharged from its duties and obligations under this Mortgage.  After any retiring or removed Agent’s resignation or removal hereunder as Agent, the provisions of this Mortgage and the Agency Documents shall inure to its benefit as to any actions taken or omitted to be taken by it under this Mortgage while it was Agent hereunder.

 

Section 9.14         Subrogation.  If any or all of the proceeds of the Indebtedness are used to extinguish, extend or renew any indebtedness heretofore existing against the Mortgaged Property, then, to the extent of the funds so used, Mortgagee and the other Secured Parties shall be subrogated to all of the rights, claims, liens, titles, and interests existing against the Mortgaged Property heretofore held by, or in favor of, the holder of such indebtedness and such former rights, claims, liens, titles, and interests, if any, are not waived but rather are continued in full force and effect in favor of Mortgagee and the other Secured Parties and are merged with the lien and security interest created herein as cumulative security for the repayment of the Indebtedness and the performance of the Obligations.

 

ARTICLE 10
 LOCAL LAW PROVISIONS

 

[To Come]

 

[The remainder of this page has been intentionally left blank]

 

13

 

IN WITNESS WHEREOF, Mortgagor has on the date set forth in the acknowledgement hereto, effective as of the date first above written, caused this instrument to be duly EXECUTED AND DELIVERED by authority duly given.

 

	
MORTGAGOR:
    	
[                                             ],
    
	
 
    	
a [                                             ]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

S-1

 

[Insert State specific notary block]

 

N-1

 

SCHEDULE I

 

INSURANCE, CASUALTY AND CONDEMNATION REQUIREMENTS

 

1.1 Insurance.

 

1.1.1       Insurance Policies.  (a)  [Mortgagor/Grantor] shall obtain and maintain, or cause to be maintained, insurance for [Mortgagor/Grantor] and the [Mortgaged Property/Trust Property] providing at least the following coverages:

 

(i)            all risk insurance on the Improvements and the personal property at the [Mortgaged Property/Trust Property], in each case (A) in an amount equal to one hundred percent (100%) of the “Full Replacement Cost,” which for purposes of this [Mortgage/Deed of Trust] shall mean actual replacement value (containing no exclusion for foundations, underground utilities and footings); (B) containing an agreed amount endorsement (or its equivalent) with respect to the Improvements and personal property at the [Mortgaged Property/Trust Property] waiving all or containing no co-insurance provisions; (C) providing for no deductible in excess of Five Hundred Thousand and No/100 Dollars ($500,000) for all such insurance coverage, except for (1) windstorm coverage in which the deductible may not exceed the greater of (a) Five Hundred Thousand and No/100 Dollars ($500,000), and (b) five percent (5%) of the insured value of the [Mortgaged Property/Trust Property] (provided, however, that if windstorm coverage is not available at commercially reasonable rates with such a deductible, [Mortgagor/Grantor] shall procure the same with a commercially reasonable deductible), (2) earthquake coverage in which the deductible may not exceed the greater of (a) Five Hundred Thousand and No/100 Dollars ($500,000), and (b) five percent (5%) of the insured value of the [Mortgaged Property/Trust Property], and (3) flood coverage in which the deductible may not exceed Five Hundred Thousand and No/100 Dollars ($500,000) per building; and (D) containing an “Ordinance or Law Coverage” or “Enforcement” endorsement, including coverage for the value of the undamaged portion of the building, demolition costs and increased cost of construction,  if any of the Improvements or the use of the [Mortgaged Property/Trust Property] shall at any time constitute legal non-conforming structures or uses.

 

(ii)           commercial general liability and professional liability insurance against claims for personal injury, bodily injury, death or property damage occurring upon, in or about the [Mortgaged Property/Trust Property], such insurance (A) to be on the so-called “claims made” form with general liability and professional liability limits, excluding umbrella coverage, of not less than $500,000 per occurrence, with no deductible or self insured retention over and above what is covered by [Mortgagor/Grantor]’s wholly-owned captive insurance company (Senior Living Insurance Company, Ltd.); (b) to continue at not less than the aforesaid limit until required to be changed by Agent in writing by reason of changed economic conditions making such protection inadequate; and (C) to cover at least the following hazards:  (1) premises and operations; (2) products and completed operations on an “if any” basis; (3) independent contractors; and (4) blanket contractual liability for all insured contracts; and (5) acts of terrorism;

 

Sched I-1

 

(iii)          business income insurance (A) with loss payable to Agent; (B) covering all risks required to be covered by the insurance provided for in subsection (i) above; (C) containing an extended period of indemnity endorsement which provides that after the physical loss to the Improvements and personal property has been repaired, the continued loss of income will be insured until such income either returns to the same level it was at prior to the loss, or the expiration of six (6) months from the date that the [Mortgaged Property/Trust Property] is repaired or replaced and operations are resumed, whichever first occurs, and notwithstanding that the policy may expire prior to the end of such period; and (D) in an amount equal to one hundred percent (100%) of the gross income from the [Mortgaged Property/Trust Property] for a period of eighteen (18) months from the date of loss.  The amount of such business income insurance shall be determined prior to the date hereof and at least once each year thereafter based on [Mortgagor/Grantor]’s reasonable estimate of the gross income from the [Mortgaged Property/Trust Property] for the succeeding eighteen (18) month, or greater, as applicable, period;

 

(iv)          at all times during which structural construction, repairs or alterations are being made with respect to the Improvements, (A) owner’s contingent or protective liability insurance covering claims not covered by or under the terms or provisions of the above mentioned commercial general liability insurance policy; and (B) the insurance provided for in subsection (i) above written in a so-called builder’s risk completed value form (1) on a non-reporting basis, (2) against all risks insured against pursuant to subsection (i) above, (3) including permission to occupy the [Mortgaged Property/Trust Property], and (4) with an agreed amount endorsement waiving co-insurance provisions;

 

(v)           workers’ compensation, subject to the statutory limits of the state in which the [Mortgaged Property/Trust Property] is located, and employer’s liability insurance with a limit of at least $1,000,000 per accident and per disease per employee, and $1,000,000 for disease aggregate in respect of any direct employees of [Mortgagor/Grantor];

 

(vi)          comprehensive boiler and machinery insurance covering all mechanical and electrical equipment and pressure vessels and boilers in an amount not less than their replacement cost or in such other amount as shall be reasonably required by Agent;

 

(vii)         intentionally omitted

 

(viii)        if any portion of the [Mortgaged Property/Trust Property] includes a structure with at least two walls and a roof (a “Building”) or a Building in the course of construction and such Building is located in an area identified by the Federal Emergency Management Agency as an area having special flood hazards, then [Mortgagor/Grantor] shall maintain, or cause to be maintained, with a financially sound and reputable insurer, flood insurance on terms and in an amount sufficient to comply with all applicable rules and regulations promulgated pursuant to the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973 (including any amendment or successor act or acts thereto) (“Flood Insurance”);

 

(ix)          earthquake (if the [Mortgaged Property/Trust Property] is in an Earthquake Zone 3 or 4 with a probable maximum loss of greater than 20%), sinkhole

 

Sched I-2

 

and mine subsidence insurance, if required, in amounts equal to the probable maximum loss (net of applicable deductibles) of the [Mortgaged Property/Trust Property] as determined by Agent in its reasonable discretion and in form and substance satisfactory to Agent, provided that the insurance pursuant to this subsection (ix) shall be on terms consistent with the all risk insurance policy required under subsection 1.1.1(a)(i);

 

(x)           umbrella liability insurance, in addition to primary coverage, in a total amount of not less than $20,000,000 per occurrence for professional liability and $25,000,000 per occurrence for general liability on terms consistent with the commercial general liability insurance policy required under subsection (ii) above;

 

(xi)          intentionally omitted;

 

(xii)         motor vehicle liability coverage for all owned and non-owned vehicles, including rented and leased vehicles containing minimum limits per occurrence, excluding umbrella coverage, of One Million and No/100 Dollars ($1,000,000);

 

(xiii)        so-called “host liquor liability” insurance or other liability insurance required in connection with distributing and serving, but not selling, alcoholic beverages;

 

(xiv)        if [Mortgagor/Grantor] has employees, insurance against employee dishonesty in an amount not less than $1 million per loss and with a deductible not greater than Fifteen Thousand and No/100 Dollars ($15,000); and

 

(xv)         such other insurance and in such amounts as Agent from time to time may reasonably request against such other insurable hazards which at the time are commonly insured against for property similar to the [Mortgaged Property/Trust Property] located in or around the region in which the [Mortgaged Property/Trust Property] is located.

 

The comprehensive all risk insurance, business income insurance, general liability and umbrella liability policies required under subsections (i), (ii), (iii), and (x) above shall be required to cover perils of terrorism and acts of terrorism for the maximum amount obtainable up to the amounts set forth in subsections (i) (ii), (iii), and (x) above and with deductibles no greater than the deductibles set forth in subsections (i), (ii), (iii), and (x) above.  Notwithstanding the foregoing, if acts of terrorism or perils of terrorism or other similar acts or events are hereafter excluded from the policies required under subsections (i) (ii), (iii), and (x) above, [Mortgagor/Grantor] shall obtain an endorsement to such policy (or a separate policy from an insurance provider reasonably approved by Agent), if available at commercially reasonable rates as determined by Agent, insuring against all acts of terrorism and perils of terrorism and “fire following” (or, in the case of any period of time during which the Terrorism Risk Insurance Act of 2002 (“TRIA”) or its successors, is in effect, insuring against all “certified acts of terrorism” as defined in TRIA and “fire following”), each in an amount and on terms consistent with the requirements of subsections (i) (ii), (iii), and (x) above. The endorsement or policy shall be in form and substance reasonably satisfactory to Agent.

 

(b)           All insurance provided for in Section 1.1.1(a) above shall be obtained under valid and enforceable policies (collectively, the “Policies” or in the singular, the “Policy”) and, to the extent not specified above, shall be subject to the reasonable approval of Agent as to deductibles, loss payees and insureds.  Prior to the expiration dates of the Policies theretofore furnished to Agent, certificates of insurance evidencing the renewal or successor Policies accompanied by evidence satisfactory to Agent of

 

Sched I-3

 

payment of the premiums then due thereunder (the “Insurance Premiums”), shall be delivered by [Mortgagor/Grantor] to Agent. Within ten (10) days of request by Agent, [Mortgagor/Grantor] shall deliver to Agent carrier-certified copies of the Policies, provided that the Policies are available.

 

(c)           Any blanket insurance Policy shall specifically allocate to the [Mortgaged Property/Trust Property] the amount of coverage from time to time required hereunder and shall otherwise provide the same protection as would a separate Policy insuring only the [Mortgaged Property/Trust Property] in compliance with the provisions of Section 1.1.1(a) above.

 

(d)           All Policies of insurance provided for or contemplated by Section 1.1.1(a) above, except for the Policy referenced in Section 1.1.1(a)(v), shall name [Mortgagor/Grantor] as the insured and Agent and its successors and/or assigns as the additional insured, as their interests may appear, and the Policies referenced in Section 1.1.1(a)(ii) above shall also name each other Secured Party and its successors and/or assigns as additional insureds, and in the case of property damage, boiler and machinery, flood and earthquake insurance, shall contain a so-called New York standard mortgagee endorsement and loss payable clause in favor of and acceptable to Agent.

 

(e)           All Policies of insurance provided for in Section 1.1.1(a) above, except for the Policies referenced in Section 1.1.1(a)(v), shall contain clauses or endorsements to the effect that:

 

(i)            no act or negligence of [Mortgagor/Grantor], or anyone acting for [Mortgagor/Grantor], or of any tenant or other occupant, or failure to comply with the provisions of any Policy, which might otherwise result in a forfeiture of the insurance or any part thereof, shall in any way affect the validity or enforceability of the insurance insofar as Agent or any Secured Party is concerned;

 

(ii)           the Policy shall not be cancelled without at least thirty (30) days’ written notice to Agent, with ten (10) days’ written notice permissible for nonpayment of premium, and notwithstanding the fact that liability policies may only provide notice of cancellation to the named insured; and

 

(iii)          Neither Agent nor any Secured Party shall be a co-insurer and they shall not be liable for any contribution or Insurance Premiums thereon or subject to any assessments thereunder.

 

(f)            If at any time Agent is not in receipt of written evidence that all insurance required hereunder is in full force and effect, and such failure continues after written request therefor, Agent shall have the right, without notice to [Mortgagor/Grantor], to take such action as Agent deems necessary to protect its interest in the [Mortgaged Property/Trust Property], including, without limitation, the obtaining of such insurance coverage as Agent in its sole discretion deems appropriate and all expenses incurred by Agent in connection with such action or in obtaining such insurance and keeping it in effect shall be paid by [Mortgagor/Grantor] to Agent upon demand and until paid shall be secured by this [Mortgage/Deed of Trust] and shall bear interest at the default interest rate specified in the Credit Agreement.

 

(g)           In the event of foreclosure of this [Mortgage/Deed of Trust] or other transfer of title to the [Mortgaged Property/Trust Property] in extinguishment in whole or in part of the Facility, all right, title and interest of [Mortgagor/Grantor] in and to the Policies then in force concerning the [Mortgaged Property/Trust Property] and all proceeds payable thereunder shall thereupon vest in the purchaser at such foreclosure or Agent or other transferee in the event of such other transfer of title.

 

Sched I-4

 

1.1.2       Insurance Company.  The Policies shall be issued by financially sound and responsible insurance companies authorized to do business in the state in which the [Mortgaged Property/Trust Property] is located and shall be otherwise reasonably satisfactory to Agent, and carry an S&P rating of at least “A-”.  If four or fewer insurance companies issue the policies, then at least 75% of the insurance coverage represented by the policies must be provided by insurance companies with a claims paying ability rating of “A-” or better by S&P, with no carrier below “BBB” by S&P.  If five (5) or more insurance companies issue the policies, then at least sixty percent (60%) of the insurance coverage represented by the policies must be provided by insurance companies with a claims paying ability rating of “A-” or better by S&P, with no carrier below “BBB” by S&P. Notwithstanding the foregoing, [Mortgagor/Grantor] shall be permitted to maintain the Policies with insurance companies which do not meet the foregoing requirements (an “Otherwise Rated Insurer”), provided [Mortgagor/Grantor] obtains a “cut-through” endorsement (that is, an endorsement which permits recovery against the provider of such endorsement) with respect to any Otherwise Rated Insurer from an insurance company which meets the claims paying ability ratings required above. Also notwithstanding the foregoing, Agent has approved Landmark American Insurance Company, Torus Specialty Insurance Company and Aspen Specialty Insurance Company for this loan so long as they maintain an AM Best rating of at least A- XI by AM Best. Also Approved for this loan is Senior Living Insurance Company Limited, a [Mortgagor/Grantor]-funded captive insurance company that provides coverage to reimburse [Mortgagor/Grantor] for any general liability and professional liability deductibles/retentions.

 

Sched I-5

 

EXHIBIT A

 

LEGAL DESCRIPTION

 

Legal Description of premises located at [                                 ]:

 

[See Attached Page(s) For Legal Description]

 

Exh. A-1

 

[EXHIBIT B

 

PERMITTED ENCUMBRANCES]

 

Those exceptions set forth in Schedule B of that certain policy of title insurance issued to Mortgagee by [              ] on or about the date hereof pursuant to commitment number [         ].

 

Exh. B-1

 

EXHIBIT H to the

CREDIT AGREEMENT

 

FORM OF BORROWING

BASE CERTIFICATE

 

BORROWING BASE CERTIFICATE

 

Five Star Quality Care, Inc.,

Borrowing Base Certificate

Period ending   /  /

 

Citibank, N.A.

as Administrative Agent

under the Credit Agreement

referred to below

1615 Brett Road OPS III

New Castle, DE 19720

Attention:  Bank Loan Syndications Department

 

Pursuant to provisions of that certain Amended and Restated Credit Agreement, dated as of February 24, 2017, among Five Star Quality Care, Inc., a Maryland corporation, as borrower (“Borrower”), the Guarantors party thereto, Citibank, N.A., as Administrative Agent and Collateral Agent for the Secured Parties, the Secured Parties identified therein, and the Arrangers party thereto (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms not otherwise defined herein shall have their respective meanings set forth in the Credit Agreement), the undersigned, a Responsible Officer of the Borrower, hereby certifies and represents and warrants on behalf of the Borrower as follows:

 

1.             The information contained in Schedule I of this certificate and the attached information supporting the calculation of the Facility Available Amount, Total Borrowing Base Value, and Borrowing Base Debt Service Coverage Ratio is true, complete and correct as of the close of business on             , 20   (the “Calculation Date”) and has been prepared in accordance with the provisions of the Credit Agreement.

 

2              The Facility Exposure of $                   does not exceed the Facility Available Amount of $                      as required by Section 5.04(b)(i) of the Credit Agreement.

 

3.             This certificate is furnished to the Administrative Agent pursuant to Section [3.02][5.01(k)][5.02(d)][5.02 (e)(iii)(D)][5.03(d)] of the Credit Agreement.

 

4.             The Borrowing Base Assets comply with all Borrowing Base Conditions and the other conditions, terms, warranties, representations and covenants set forth in the Credit Agreement other than those previously waived in writing by the Administrative Agent and the Required Lenders.

 

 

In each case, with supporting information showing the computations used in determining compliance with such covenants set forth on Schedule I attached hereto.

 

 

	
 
    	
FIVE STAR QUALITY   CARE, INC.,
    
	
 
    	
a Maryland corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

 

Schedule I — Financial Covenant Computations

 

(See Attached Pages)

 

 

	
Five Star Quality   Care, Inc.
    	
 
    	
 
    
	
Borrowing Base Covenant Calculation
    	
 
    	
 
    
	
As of   [          ]
    	
 
    	
 
    

 

	
Facility Available Amount (the lesser of 1, 2, 3 and   4)
    	
 
    	
[                    ]
    
	
Facility Exposure (must not exceed #1 above)
    	
 
    	
[                    ]
    
	
 
    	
 
    	
 
    
	
Facility Available Amount (the lesser of 1, 2, 3 and   4)
    	
 
    	
[                    ]
    
	
 
    	
 
    	
 
    
	
1 $100,000,000
    	
 
    	
[                    ]
    
	
2 Total Borrowing Base Value
    	
 
    	
[                    ]
    
	
3 Amount that would result in a BB DSCR = 1.5x
    	
 
    	
[                    ]
    
	
4 Aggregate amount of title insurance
    	
 
    	
[$100,000,000]
    
	
 
    	
 
    	
 
    
	
Total Borrowing Base Value
    	
 
    	
[                    ]
    
	
 
    	
 
    	
 
    
	
Is the aggregate Asset Value of all Borrowing Base   Assets more than $100,000,000?
    	
 
    	
[                    ]
    
	
Is the number of Borrowing Base Assets not less than   5?
    	
 
    	
[                    ]
    
	
Total Borrowing Base Value adjusted subject to   adjusted NOI concentration limit and minimum of 75% private pay operating   revenue
    	
 
    	
[                    ]
    
	
 
    	
 
    	
 
    
	
Amount that would result in a BB DSCR = 1.5x
    	
 
    	
[                    ]
    
	
 
    	
 
    	
 
    
	
Aggregate Adjusted NOI for all Borrowing Base Assets
    	
 
    	
[                    ]
    
	
Facility Exposure
    	
 
    	
[                    ]
    
	
1 Month Eurodollar Rate
    	
 
    	
[                    ]
    
	
10 Year Treasuries Rate
    	
 
    	
[                    ]
    
	
7.50% per annum
    	
 
    	
[                    ]
    
	
Margin Used
    	
 
    	
[                    ]
    
	
Coupon Rate Used
    	
 
    	
[                    ]
    
	
Debt Service
    	
 
    	
[                    ]
    
	
DSCR
    	
 
    	
[                    ]
    

 

 

Five Star Quality Care, Inc.
 Borrowing Base Property Inputs 
 For the Twelve Months Ended [          ]

	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Facility
    	
 
    	
Asset Value
    	
 
    	
Included
   in Total
   Borrowing
   Base
   Value?
    	
 
    	
Borrowing
   Base Value
    	
 
    	
Adjusted NOI
    	
 
    	
%
   ANOI
   of
   Total
    	
 
    	
Borrowing Base
   Value adjustment
   for 25% ceiling (1)
    	
 
    	
Borrowing Base
   Value adjusted for
   25% ceiling (1)
    	
 
    	
Adjusted
   Operating
   Revenue
    	
 
    	
Adjusted
   Operating
   Revenue from
   Private Pay (1)
    	
 
    	
Adjusted
   NOI (1)
    	
 
    	
%
   private
   pay
    	
 
    	
Borrowing
   Base Value
   adjusted for
   75% floor
   (2)
    
	
1
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
2
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
3
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
4
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
5
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
6
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
7
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
8
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
9
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
10
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

(1) Total Borrowing Base Value with max 25% NOI restriction

(2) Total Borrowing Base Value with min 75% private pay condition

 

 

EXHIBIT I-1

 

FORM OF

 

SECTION 2.12(g) U.S. TAX COMPLIANCE CERTIFICATE

 

(For Foreign Lender Parties That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement dated as of February 24, 2017 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among  Five Star Quality Care, Inc., as borrower, and Citibank, N.A., as administrative agent and collateral agent, and the other parties party thereto.

 

Pursuant to the provisions of Section 2.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Advance(s) (as well as any Note(s) evidencing such Advance(s)) in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (iii) it is not a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code, and (iv) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Internal Revenue Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN or W-8BEN-E, as applicable.  By executing this certificate, the undersigned agrees that if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

 

	
[NAME OF LENDER PARTY]
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
Date:                        ,   20[ ]
    	
 
    

 

Exhibit I-1

 

EXHIBIT I-2

 

FORM OF

 

SECTION 2.12(g) U.S. TAX COMPLIANCE CERTIFICATE

 

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement dated as of February 24, 2017 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among  Five Star Quality Care, Inc., as borrower, and Citibank, N.A., as administrative agent and collateral agent, and the other parties party thereto.

 

Pursuant to the provisions of Section 2.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (iii) it is not a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code, and (iv) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Internal Revenue Code.

 

The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

 

	
[NAME OF PARTICIPANT]
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
Date:                        ,   20[ ]
    	
 
    

 

Exhibit I-2

 

EXHIBIT I-3

 

FORM OF

 

SECTION 2.12(g) U.S. TAX COMPLIANCE CERTIFICATE

 

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement dated as of February 24, 2017 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among  Five Star Quality Care, Inc., as borrower, and Citibank, N.A., as administrative agent and collateral agent, and the other parties party thereto.

 

Pursuant to the provisions of Section 2.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect to such participation, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code, and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Internal Revenue Code.

 

The undersigned has furnished its participating Lender with Internal Revenue Service Form W-8IMY accompanied by one of the following forms from each its partners/members that is claiming the portfolio interest exemption:  (i) an Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, or (ii) an Internal Revenue Service Form W-8IMY accompanied by an Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

	
[NAME OF PARTICIPANT]
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
Date:                        ,   20[ ]
    	
 
    

 

Exhibit I-3

 

EXHIBIT I-4

 

FORM OF

 

SECTION 2.12(g) U.S. TAX COMPLIANCE CERTIFICATE

 

(For Foreign Lender Parties That Are Partnerships For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement dated as of February 24, 2017 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among  Five Star Quality Care, Inc., as borrower, and Citibank, N.A., as administrative agent and collateral agent, and the other parties party thereto.

 

Pursuant to the provisions of Section 2.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Advance(s) (as well as any Note(s) evidencing such Advance(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Advance(s) (as well as any Note(s) evidencing such Advance(s)); (iii) with respect to the extension of credit pursuant to this Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code, and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Internal Revenue Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with Internal Revenue Service Form W-8IMY accompanied by one of the following forms from each its partners/members that is claiming the portfolio interest exemption:  (i) an Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, or (ii) an Internal Revenue Service Form W-8IMY accompanied by an Internal Revenue Service Form W-8BEN or W-8BEN-E, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

 

	
[NAME OF LENDER PARTY]
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
Date:                        ,   20[ ]
    	
 
    

 

Exhibit I-4

 

EXHIBIT J to the

CREDIT AGREEMENT

 

FORM OF COMPLIANCE CERTIFICATE

 

COMPLIANCE CERTIFICATE

 

Five Star Quality Care, Inc.

Dated [         ] [  ], 20[  ]

 

Citibank, N.A.

as Administrative Agent

under the Credit Agreement

referred to below

1615 Brett Road OPS III

New Castle, DE 19720

Attention:  Bank Loan Syndications Department

 

Pursuant to Section [5.03(b)] [5.03(c)] of that certain Amended and Restated Credit Agreement dated as of February 24, 2017, among Five Star Quality Care, Inc., a Maryland corporation (“Borrower”), the Guarantors party thereto, the Lender Parties party thereto, Citibank, N.A., as Collateral Agent and as Administrative Agent for the Lender Parties and the Arrangers party thereto (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms not otherwise defined herein shall have their respective meanings set forth in the Credit Agreement), the undersigned, the [Chief Financial Officer] of the Borrower, hereby certifies and represents and warrants on behalf of the Borrower as follows:

 

1.             The information contained in this certificate and the attached information supporting the calculation of (i) the Leverage Ratio, (ii) the tangible net worth of the Borrower and its Subsidiaries, as determined in accordance with GAAP (but exclusive of depreciation and amortization), (iii) the Fixed Charge Coverage Ratio, (iv) the Facility Exposure, and (v) the Borrowing Base Debt Service Coverage Ratio is true, complete and correct as of the close of business on [March 31] [June 30] [September 30] [December 31], 20[  ] (the “Calculation Date”) and has been prepared in accordance with the provisions of the Credit Agreement.

 

2.             As of the Calculation Date:

 

(a)           Borrower Financial Covenants:

 

(i)                                     Maximum Leverage Ratio.  The Leverage Ratio was                        :1.00, which was not greater than 5.00:1.00 as required by Section 5.04(a)(i) of the Credit Agreement.

 

(ii)                                  Minimum Tangible Net Worth.  The tangible net worth of the Borrower and its Subsidiaries, as determined in accordance with GAAP (but exclusive of depreciation and amortization) was $                      which was not less than the applicable minimum tangible net worth required by Section 5.04(a)(ii) of the Credit Agreement.

 

1

 

(iii)                               Minimum Fixed Charge Coverage Ratio.  The Fixed Charge Coverage Ratio was     :1.00 which was not less than 1.50:1.00 as required by Section 5.04(a)(iii) of the Credit Agreement.

 

(b)                                 Borrowing Base Covenants

 

(i)                                     Maximum Facility Exposure.  The Facility Exposure of $                                 did not exceed the Facility Available Amount of $                  , as required by Section 5.04(b)(i) of the Credit Agreement.

 

(ii)                                  Minimum Borrowing Base Debt Service Coverage Ratio.  The Borrowing Base Debt Service Coverage Ratio was            :1.00 which was not less than 1.50:1.00.

 

In each case, supporting information showing the computations used in determining compliance with such covenants is attached hereto as Exhibit A.

 

3.             The undersigned hereby certifies that (i) no Default has occurred and is continuing and (ii) Borrower has not taken any action nor proposes to take any action with respect to any Default or the continuance thereof, other than as set forth in Exhibit B attached hereto.

 

[Balance of page intentionally left blank.]

 

2

 

IN WITNESS WHEREOF, I have executed this Compliance Certificate this       day of               , 20   .

 

 

	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title: Chief Financial Officer
    

 

 

I,                 , the duly qualified                       of Five Star Quality Care, Inc., a Maryland corporation, do hereby certify that                 is the duly appointed and qualified Chief Financial Officer of such corporation and that his signature set forth immediately above is his genuine signature.

 

IN WITNESS WHEREOF, I have set my hand as of this       day of               , 20   .

 

 

	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

	
 
    	
s-1

 
    	
Certificate   of Compliance

 
    

 

 

EXHIBIT A

 

SCHEDULE OF COMPUTATIONS

 

[to be attached]

 

	
 
    	
Exh A-1

 
    	
Certificate of Compliance

 
    

 

 

EXHIBIT B

 

DEFAULTS AND DESCRIPTION OF
 PROPOSED ACTIONS TO BE TAKEN

 

[Insert “none” if no Default has occurred and is continuing]

 

	
 
    	
Exh B-1

 
    	
Certificate of Compliance

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