Document:

First Amendment to Master Lease and Letter of Credit Agreement

 Exhibit 10.1 
 FIRST AMENDMENT TO MASTER LEASE 
 AND LETTER OF CREDIT AGREEMENT  
 AND CONSENT OF GUARANTOR 
 THIS
FIRST AMENDMENT TO MASTER LEASE AND LETTER OF CREDIT AGREEMENT AND CONSENT OF GUARANTOR (the “Agreement”) is entered into on June 29, 2006, to be retroactively effective as of June 1, 2006 (the “Effective
Date”), by and among the entities listed on the signature pages hereto as “Landlord” (individually and collectively, “Landlord”), the entities listed on the signature pages hereto as “Tenant”
(individually and collectively, “Tenant”), and HEARTHSTONE SENIOR SERVICES, L.P., a Delaware limited partnership (“Guarantor”). 
 R E C I T A L S 
 A. Landlord, as lessor, and Tenant, as lessee, are parties to that certain
Master Lease dated as of May 31, 2006 (the “Master Lease”), pursuant to which, among other things, Landlord leases to Tenant the “Premises” described therein. Initially capitalized terms used but not otherwise defined
in this Agreement shall have the meanings given to them in the Master Lease. 
 B. In connection with the Master Lease, Landlord and
Tenant are also parties to that certain Letter of Credit Agreement of even date with the Master Lease (the “LC Agreement”), pursuant to which, among other things, Tenant has posted with Landlord the Letter of Credit described
therein as partial collateral for the performance of its obligations under the Master Lease. 
 C. Pursuant to the Guaranty of even
date with the Master Lease (the “Guaranty”), Guarantor has, among other things, guarantied to Landlord the performance by Tenant of its obligations under the Master Lease and LC Agreement. 
 D. Landlord, Tenant and Guarantor now desire to amend the Master Lease, LC Agreement and Guaranty to, among other things, make certain
clarifications to the Master Lease, all as more particularly set forth herein. 
 A G R E E M E N T 
 NOW, THEREFORE, taking into account the foregoing Recitals, and in consideration of the mutual covenants and agreements contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
  

 - 1 - 

 1. Amendments to Master Lease. The Master Lease is hereby specifically amended as set forth
in this Section 2. 
 (a) Initial Term Rent. Section 2.1(a) of the Master Lease is amended and
restated in its entirety as follows: 
 “During the Initial Term, subject to the redetermination thereof pursuant to
Section 2.2, “Minimum Rent” is Thirty-One Million Five Hundred Eighty-Two Thousand One Hundred Eighty-One Dollars ($31,582,181) per Lease Year, payable in advance in twelve (12) equal monthly installments.
Commencing with the second (2nd) Lease Year and continuing thereafter during the Term (excluding the eighth
(8th) Lease Year of the Initial Term and the first (1st) Lease Year of any Renewal Term as further provided in Section 2.2), Tenant agrees to pay “Additional Rent” to Landlord
monthly in advance together with the payment of Minimum Rent. Such Additional Rent (which shall be expressed as an annual amount but shall be payable in equal monthly installments) shall be equal to the sum of (a) the Additional Rent for
the immediately preceding Lease Year and (b) the sum of (I) the product of (i) the Minimum Rent and Additional Rent due for the immediately preceding Lease Year and (ii) one percent (1%), and
(II) the product of (i) the Minimum Rent and Additional Rent due for the immediately preceding Lease Year and (ii) the lesser of (x) two percent (2.0%) or (y) a percentage equal to five
(5) times the CPI Increase. During the Initial Term (but not during any Renewal Term), Tenant shall also pay “Supplemental Rent,” which shall be calculated on a quarterly basis in an amount equal to the Applicable Percentage of
Revenue, multiplied by Revenue for the applicable fiscal quarter. Supplemental Rent shall be due and payable as follows: (A) during each of the first two (2) Lease Years (each an “Accrual Year”), Supplemental
Rent shall accrue but shall not be payable; (B) in the third (3rd) Lease Year, in addition to
amounts payable pursuant to the following clause (C), Tenant shall pay the aggregate amount of Supplement Rent for the first two (2) Lease Years accrued in accordance with the preceding clause (A) in twelve
(12) equal monthly installments, which shall be payable with each payment of Minimum Rent during such Lease Year, and (C) in each Lease Year during the Initial Term commencing with the third (3rd) Lease Year, Tenant shall pay Supplemental Rent for each fiscal quarter within thirty (30) days after the end of such quarter,
provided that Landlord may, in its sole and absolute discretion, allow Tenant to defer payment of all or a portion of the Supplemental Rent payable in the third (3rd) Lease Year until the fourth (4th) Lease Year, in which
case the aggregate amount deferred shall be payable in twelve (12) equal monthly installments in the fourth (4th) Lease Year, each payable with each payment of Minimum Rent during such Lease Year. Notwithstanding the foregoing, in the event that, in accordance with Section 16, Landlord in its sole and absolute discretion
consents to any change of control in Guarantor, or to any other transaction constituting an assignment of this Lease pursuant to the terms of Section 16, all accrued but unpaid Supplemental Rent shall be immediately due and
payable.” 
  

 - 2 - 

 (b) Restrictions on Distributions. Section 4.3(b) of the Master Lease is
amended and restated in its entirety as follows: 
 “As used herein, (1) “Restricted
Dividend” means any Dividend, other than a Tax Dividend, that is made at any time that the Dividend Conditions are not then satisfied; (2) “Dividend” means any dividend, payment or other
distribution of cash or property by Guarantor to its shareholders or any other Person on account of or with respect to the capital stock of Guarantor; (3) “Dividend Conditions” means that
(i) the Rent Coverage Ratio for the Preceding Fiscal Quarter is greater than or equal to 1.20 to 1.00 and (ii) that Guarantor shall have had Minimum Net Working Capital Balances for the Preceding Fiscal Quarter; and
(4) “Preceding Fiscal Quarter” means the fiscal quarter immediately preceding the fiscal quarter in which the Dividend in question is made or to be made; (5) “Minimum Net Working
Capital Balances” means that Guarantor shall have Net Working Capital as of the end of any applicable fiscal quarter equal to or greater than the lesser of (i) an amount equal to forty-one percent (41%) of
Revenue for such quarter, or (ii) Fifteen Million Four Hundred Fifty Thousand Dollars ($15,450,000); (6) “Net Working Capital” means the sum of the amounts of the line items on
Guarantor’s consolidated balance sheet for “Cash,” “Restricted Funds, short term,” “Accounts Receivable,” “Other Current Assets (Inventory and Prepaid Expenses)” and “Restricted Funds, long
term” minus the sum of the amounts of the line items on Guarantor’s consolidated balance sheet for “Accounts Payable” and “Accrued Expenses,” as each of the same line items may be re-named or amended from time to
time, and including as appropriate such similar line items created by Guarantor after the date hereof, each as determined as of the relevant date and calculated in a manner consistent with Guarantor’s and HAL’s respective past practices
and the Contribution Agreement; (7) “Tax Dividend” means a Dividend in an amount which does not exceed the Tax Expense for all the members of the Guarantor for the Tax Period most recently ended;
(8) “Tax Expense” shall mean for any member of Guarantor, an amount equal to the product of (i) the amount of federal and state taxable income of Guarantor for the applicable Tax Period,
(ii) the Presumed Tax Rate, giving effect to the character of such taxable income as ordinary income or capital gain income, and (iii) such member’s percentage interest in Guarantor; (9) “Tax
Period” means the calendar year or quarter to which any applicable Tax Expense is attributable, and (10) “Presumed Tax Rate” means (i) with respect to income taxable as ordinary
income or short term capital gains, the highest combined federal and state income tax rate applicable during the applicable Tax Period, and (ii) with respect to income taxable as long-term capital gains, the highest rate then applicable
to the gains on capital held for at least twelve (12) months, in both cases as determined without regard to the adjustment provided in Sections 67 and 68 of the Internal Revenue Code.” 
 2. Amendments to Letter of Credit Agreement. The LC Agreement is hereby specifically amended as set forth in this Section 2. As
set forth and used in the LC Agreement, the term “Lease” shall mean “the Master Lease dated as of even date with this Agreement, as amended, modified or revised from time to time.” 
  

 - 3 - 

 3. Affirmation of Obligations under Lease Documents and Guaranty. 
 (a) Notwithstanding the modifications to the Master Lease and LC Agreement contained herein, Tenant and Landlord each hereby
acknowledges and affirms its respective obligations under the Master Lease and LC Agreement (each as modified hereby) and all other documents executed by such party in connection therewith. 
 (b) Guarantor hereby consents to the terms of this Agreement in all respects. Notwithstanding the modifications to the Master Lease
and LC Agreement contained herein, Guarantor hereby acknowledges and affirms its obligations under the Guaranty and all documents executed by Guarantor in connection therewith. 
 4. Interpretation. This Agreement shall be construed as a whole and in accordance with its fair meaning. Headings are for convenience only
and shall not be used in construing meaning. 
 5. Further Instruments. Each party will, whenever and as often as it shall be
reasonably requested so to do by another party, cause to be executed, acknowledged or delivered, any and all such further instruments and documents as may be necessary or proper, in the reasonable opinion of the requesting party, in order to carry
out the intent and purpose of this Agreement. 
 6. Incorporation of Recitals. The Recitals to this Agreement are incorporated
hereby by reference. 
 7. Counterparts. This Agreement may be executed in counterparts, all of which executed counterparts
shall together constitute a single document. Signature pages may be detached from the counterparts and attached to a single copy of this document to physically form one document. 
 8. Effect of Amendment. Except as specifically amended pursuant to the terms of this Agreement, the terms and conditions of the Master
Lease, LC Agreement and Guaranty shall remain unmodified and in full force and effect. In the event of any inconsistencies between the terms of this Agreement and any terms of the Master Lease, LC Agreement or Guaranty, the terms of this Agreement
shall govern and prevail. 
 9. Entire Agreement. This Agreement contains the entire agreement between the parties relating to
the subject matters contained herein. Any oral representations or statements concerning the subject matters herein shall be of no force or effect. 
 [SIGNATURES ON NEXT PAGE] 
  

 - 4 - 

 IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as of the Effective
Date. 
  

	
	“TENANT”:

  

					
	 ARLINGTON ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Arlington Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 BARTLETT ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Bartlett Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 CHATTANOOGA ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Chattanooga Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 

  

			
	 AUSTIN ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Austin Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 BIRMINGHAM ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Birmingham Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 CONROE ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Conroe Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

 Signature Page - 1 

					
	 GARLAND ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Garland Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 CY-FAIR ASSISTED
LIVING, LTD.,
 a Texas limited partnership
  
 By:   Cy-Fair Assisted Living G.P.,
Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 IRVING ASSISTED LIVING,
LTD.,
 a Texas limited partnership
  
 By:   Irving Assisted Living G.P.,
Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 KENTWOOD ASSISTED
LIVING, LTD.,
 a Texas limited partnership
  
 By:   Kentwood Assisted Living, G.P.,
Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 

  

			
	 BRAESWOOD ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Braeswood Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 HUNTSVILLE ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Huntsville Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 CLAYTON COUNTY ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Clayton Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 LAKE JACKSON ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Lake Jackson Assisted Living, G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

 Signature Page - 2 

					
	 LEWISVILLE ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Lewisville Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 COBB COUNTY ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Cobb County Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 MADISON ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Madison Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 
	  
 OKLAHOMA CITY ASSISTED LIVING LIMITED
PARTNERSHIP,
 a Texas limited partnership
  
 By:   Oklahoma City Assisted Living G.P.,
Inc.,
          a Texas corporation, its General Partner
  
	  	 
			 
	By:	 	/s/    RICHARD ROSENBERG	  	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	  	 

  

			
	 LORAIN ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Lorain Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 MOBILE ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Mobile Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 NASHVILLE ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Nashville Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

	  
 SAN ANTONIO ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   San Antonio Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

 Signature Page - 3 

					
	 CARROLLWOOD ASSISTED LIVING
 OPERATIONS, LTD.,
 a Texas limited partnership
  
 By:   Carrolwood Assisted Living G.P.,
Inc.,
          a Texas corporation, its General Partner
  
	 	 
			 
	By:	 	/s/    RICHARD ROSENBERG	 	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	 	 
		 
	 TEMPLE ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Temple Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	 	 
			 
	By:	 	/s/    RICHARD ROSENBERG	 	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	 	 
		 
	 TUCSON ASSISTED LIVING LIMITED PARTNERSHIP,
 a Texas limited partnership
  
 By:   Tucson Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	 	 
			 
	By:	 	/s/    RICHARD ROSENBERG	 	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	 	 
		 
	 WHARTON ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Wharton Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  
	 	 
			 
	By:	 	/s/    RICHARD ROSENBERG	 	 
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President
	 	 

  

			
	 TEMPE ASSISTED LIVING LIMITED PARTNERSHIP,
 a Texas limited partnership
  
 By:   Tempe Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 TEXAS CITY ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Texas City Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 VICTORIA ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Victoria Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

			
	 ALBUQUERQUE ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   Albuquerque Assisted Living G.P., Inc.,
          a Texas corporation, its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  

 Signature Page - 4 

	
	“GUARANTOR”:

  

			
	 HEARTHSTONE SENIOR SERVICES, L.P.,
 a Delaware limited partnership
  
 By:   Hearthstone Senior Living Services, LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    RICHARD ROSENBERG
	 Name:
 Title:
	 	 Richard Rosenberg
 Vice President

  
  

  

 Signature Page - 5 

	
	“LANDLORD”:

  

					
	 NATIONWIDE HEALTH PROPERTIES, INC.,
 a Maryland corporation
  
	  	 
			 
	By:	 	 /s/    ABDO H. KHOURY
	  	 
	Name:	 	Abdo H. Khoury	  	 
	Title:	 	Senior Vice President	  	 
	  
 AUSTIN ASSISTED RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
	  	 
			 
	By:	 	 /s/    ABDO H. KHOURY
	  	 
	Name:	 	Abdo H. Khoury	  	 
	Title:	 	Senior Vice President	  	 
	  
 BIRMINGHAM AL RE, L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY	  	 
	Name:	 	Abdo H. Khoury	  	 
	Title:	 	Senior Vice President	  	 

  

			
	 ARLINGTON AL RE, LTD.,
 a Texas
limited partnership
  
 By:   NHP
Master RE G.P., LLC,
          a Delaware limited liability
company,
          its General Partner

		
	By:	 	 /s/    ABDO H. KHOURY

	Name:	 	Abdo H. Khoury
	Title:	 	Senior Vice President

  

			
	 BARTLETT AL RE, L.P.,
 a
Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a
Delaware limited liability company,
          its General
Partner

		
	By:	 	 /s/    ABDO H. KHOURY

	Name:	 	Abdo H. Khoury
	Title:	 	Senior Vice President

  

			
	 CHATTANOOGA AL RE, L.P.,
 a
Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a
Delaware limited liability company,
          its General
Partner

		
	By:	 	 /s/    ABDO H. KHOURY

	Name:	 	Abdo H. Khoury
	Title:	 	Senior Vice President

  

 Signature Page - 6 

					
	 CONROE AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 
	  
 BRAESWOOD AL RE,
LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 
	  
 HUNTSVILLE AL RE,
L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 
	  
 CLAYTON COUNTY AL RE,
L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 

			
	 GARLAND AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 CY-FAIR AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 IRVING AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 LAKE JACKSON ASSISTED LIVING R.E., LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

 Signature Page - 7 

					
	 LEWISVILLE AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
	 	 
			 
	By:	 	/s/    ABDO H. KHOURY	 	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	 	 
		 
	 MOBILE AL RE, L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
	 	 
			 
	By:	 	/s/    ABDO H. KHOURY	 	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	 	 
		 
	 NASHVILLE AL RE, L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
	 	 
			 
	By:	 	/s/    ABDO H. KHOURY	 	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	 	 
		 
	 CARROLLWOOD ASSISTED LIVING, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
	 	 
			 
	By:	 	/s/    ABDO H. KHOURY	 	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	 	 

			
	 COBB COUNTY AL RE, L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 MADISON AL RE, L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 SAN ANTONIO AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 TEMPE AL RE, L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner

		
	By:	 	/s/    ABDO H. KHOURY
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

 Signature Page - 8 

					
	 TEMPLE AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY 	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 
	  
 TUCSON AL RE,
L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY 	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 
	  
 VICTORIA AL RE,
LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY 	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 
	  
 KENTWOOD AL RE LIMITED
PARTNERSHIP,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  
	  	 
			 
	By:	 	/s/    ABDO H. KHOURY 	  	 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice President
	  	 

  

			
	 TEXAS CITY AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    ABDO H. KHOURY 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 WHARTON AL RE, LTD.,
 a Texas limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    ABDO H. KHOURY 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

			
	 ALBUQUERQUE AL RE, L.P.,
 a Delaware limited partnership
  
 By:   NHP Master RE G.P., LLC,
          a Delaware limited liability company,
          its General Partner
  

		
	By:	 	/s/    ABDO H. KHOURY 
	 Name:
 Title:
	 	 Abdo H. Khoury
 Senior Vice
President

  

 Signature Page - 9Registration Rights Agreement with Riverside Fund II, L.P.

 Exhibit 4.2 
 REGISTRATION RIGHTS AGREEMENT 
 This Agreement is entered into as of January 18, 2002 by and
among (i) Applied Precision Holdings, LLC (“APHLLC”), (ii) Applied Precision, LLC (“APLLC”), (iii) Applied Precision, Inc. (“API”), (iv) Donald Snow (“Snow”), Ronald Seubert
(“Seubert”) and John Stewart (“Stewart”, and collectively with Snow and Seubert, the “Founders”), each of whom is a principal shareholder of API, (v) Riverside Fund II, L.P. (“Riverside”) and
(vi) DRW Venture Partners LP (“DRW “). API, Snow, Seubert, Stewart, Riverside, DRW and any person or entity who hereafter becomes a party to or bound by this Agreement are collectively referred to herein as, the “Holders”.

 Introduction 
 This
Agreement is being entered into in order to provide certain rights to the Holders, who, directly or indirectly, are principal equity owners of APHLLC, in the event that APHLLC, APLLC or a successor or parent corporation (APHLLC, APLLC or such
corporation, as applicable, being referred to herein as the “Company”) has equity securities registered under the Securities Act of 1933, as amended (the “Act”). 
 Now, therefore, in consideration of the mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree as follows: 
 1. Demand Registration Rights. 
 (a) Commencing on the date which is 180 days after the date when any of the Company’s Common Stock is registered under the
Act, if holders of more than 10% of the Registrable Securities (as defined in Section 4) request the Company to file a registration statement under the Act for a firm commitment underwritten public offering of not less than 10% of the
Registrable Securities (or any lesser percentage if the anticipated aggregate offering price of such offering, before underwriting discounts and commissions, exceeds $10,000,000), the Company shall (i) within 10 days notify all holders of
Registrable Securities of such request and (ii) use its best efforts to so register under the Act the Registrable Securities of all holders who request within 15 days after receiving the Company’s notice that their Registrable Securities
be included therein. The Company is obligated to effect a maximum of four such demand registrations requested by the holders of Registrable Securities. 
 (b) If the underwriter managing the offering determines that, because of marketing considerations, all of the Registrable Securities requested to be registered may not be included in the offering, then all
holders of Registrable Securities who have requested registration shall participate in the offering pro rata based upon the number of Registrable Securities which they have requested to be so registered. Such pro rata reduction shall be 

 
applied first, to shares other than Registrable Securities, which shares will not be included in the registration unless all Registrable Securities requested
to be included in the registration have been included. If any such reduction results in the inclusion of less than 80% of the Registrable Securities requested to be included therein, such registration shall not reduce the number of registrations
available to the holders of Registrable Securities under this Section 1. 
 (c) If the Company includes in any
registration required under this Section 1 a number of shares other than Registrable Securities that exceeds the number of Registrable Securities to be included, then such registration shall be deemed to be a registration under Section 2
instead of this Section 1. In all other cases where the Company includes in such registration any shares other than Registrable Securities, such registration shall remain subject to this Section 1, provided that in no event shall other
shares be included if such inclusion would (i) prevent holders of Registrable Securities from registering all Registrable Securities requested by them or (ii) adversely affect the offering price of the Registrable Securities in such
registration. 
 2. Piggyback Registration Rights. 
 (a) Whenever the Company proposes to register any Common Stock for its own or others’ account under the Act, other than a
registration relating to employee benefit plans or a registration relating to shares to be sold under Rule 145 or a similar provision under the Act, the Company shall give each holder of Registrable Securities prompt written notice of its
intent to do so. Upon the written request of any such holder given within 15 days after receipt of such notice, the Company will use its best efforts to cause to be included in such registration all of the Registrable Securities which such holder
requests. 
 (b) If the Company is advised in writing in good faith by any managing underwriter of the securities being
offered pursuant to any registration statement under this Section 2 that, because of marketing considerations, the number of shares to be sold by persons other than the Company is greater than the number of such shares which can be offered
without adversely affecting the offering, the Company may reduce pro rata the number of shares offered for the accounts of such persons (based upon the number of shares requested by each such person to be included in the registration) to a number
deemed satisfactory by such managing underwriter. Such pro rata reduction shall be applied first to shares other than Registrable Securities, which shares will not be included in the registration unless all Registrable Securities requested to be
included in the registration have been included. 
 3. Form S-3 Registration Rights. If, at a time when Form S-3 is available for such
registration, the Company shall receive from any holder of Registrable Securities a written request or requests that the Company effect a registration on Form S-3 of any of such holder’s Registrable Securities, the Company will promptly give
written notice of the proposed registration to all other holders of Registrable Securities and, as soon as practicable, effect such registration and all related qualifications and compliances as may be requested and as would permit or facilitate the
sale and distribution of all Registrable Securities as are specified in such request and any written requests of other holders given within 15 days after receipt of such notice. The Company shall have no obligation to effect a registration under
this Section 3 (a) unless the aggregate offering price of the Registrable Securities requested to be sold pursuant to 

  

 2 

 
such registration is expected to be equal to or greater than $2,000,000 or (b) more often than once in any six-month period. Any registration under this
Section 3 will not be counted as a registration under Section 1 above. 
 4. Registrable Securities. “Registrable
Securities” means all shares of Common Stock of the Company held by any Holder at any time, including without limitation any shares of Common Stock of the Company acquired (or which may be acquired upon the exercise or conversion of securities
for or into shares of Common Stock) by a Holder pursuant to any preemptive right, right of first refusal or otherwise, and any other shares of Common Stock of the Company issued in respect of any of such securities (as a result of stock splits,
stock dividends, reclassifications, recapitalizations or other events), but excluding any shares of Common Stock acquired in open market purchases; provided, however, that securities shall cease to be Registrable Securities upon (i) any sale
pursuant to a registration statement under the Act or (ii) any sale which is a “brokers’ transaction” pursuant to Rule 144 under the Act or which is in the open market under Subsection (k) of Rule 144. Whenever reference is
made in this Agreement to a request or consent of holders of a certain percentage of Registrable Securities, the determination of such percentage shall include shares of Common Stock issuable upon conversion of any convertible securities referred to
above or exercise of any options, warrants or other rights referred to above. 
 5. Selection of Underwriter. The underwriter of any
offering under Section 1 shall be selected by holders of a majority of the Registrable Securities included therein. The underwriter of any offering requested under Section 2 shall be selected by the Company. 
 6. Registration Procedures. If and whenever the Company is required by the provisions of this Agreement to use its best efforts to effect the
registration of any of the Registrable Securities under the Act, the Company shall: 
 (a) as expeditiously as possible
(and, in the case of a registration under Section 1, within 60 days of any request thereunder) file with the Securities and Exchange Commission (the “Commission”) a registration statement, in form and substance required by the Act,
with respect to such Registrable Securities and use its best efforts to cause that registration statement to become effective; 
 (b) as expeditiously as possible, prepare and file with the Commission any amendments and supplements to the registration statement and the prospectus included in the registration statement as may be necessary to keep the
registration statement effective, in the case of a firm commitment underwritten public offering, until completion of the distribution of all securities described therein and, in the case of any other offering, until the earlier of the sale of all
Registrable Securities covered thereby or 120 days after the effective date thereof 
 (c) as expeditiously as
possible, furnish to each holder that requested that Registrable Securities be included in such registration, such reasonable numbers of copies of the prospectus, including a preliminary prospectus, in conformity with the requirements of the Act,
and such other documents as such holder may reasonably request in order to facilitate the public sale or other disposition of the Registrable Securities owned by such holder; 
  

 3 

 (d) as expeditiously as possible, use its best efforts to register or qualify the
Registrable Securities covered by the registration statement under the securities or Blue Sky laws of such states as the holders thereof shall reasonably request, and do any and all other acts and things that may be necessary or desirable to enable
the holders thereof to consummate the public sale or other disposition in such states of the Registrable Securities owned by the holders; provided, however, that the Company shall not be required in connection with this Subsection (d) to
qualify to do business or to file a general consent to service of process in any such states or jurisdictions. 
 (e)
in connection with each registration pursuant to Sections 1, 2 and 3 above covering an underwritten public offering, the Company and each participating holder agrees to enter into a written agreement with the managing underwriter in such form and
containing such provisions (including, if the underwriter so requests, customary contribution provisions on the part of the Company) as are customary in the securities business for such an arrangement between such underwriter and companies of the
Company’s size and investment stature, provided that the holders shall not be obligated to enter into any such underwriting agreement if the indemnification provisions thereof are more burdensome on such holder than those contained herein or if
any standback requirement therein is for a period that exceeds the period required by this Agreement; 
 (f) at the
request of any participating holder, the Company will furnish to each underwriter, if any, and the participating holders, a legal opinion of its counsel and a letter from its independent certified public accountants, each in customary form and
substance, at such time or times as such documents are customarily provided in the type of offering involved; 
 (g)
whenever the Company is registering any Common Stock under the Act and a holder of Registrable Securities is selling securities under such registration or determines that it may be a controlling person under the Act, the Company will keep such
holder advised in writing of the initiation, progress and completion of such registration, will allow such holder and such holder’s counsel to participate in the preparation of the registration statement and to have access to all relevant
corporate records, documents and information, will include in the registration statement such information as such holder may reasonably request and will take all such other action as such holder may reasonably request; 
 (h) each holder of Registrable Securities included in a registration shall furnish to the Company such information regarding such
holder and the distribution proposed by such holder as the Company may reasonably request in writing and as shall be required in connection with the registration, qualification or compliance referred to in this Agreement; 
 (i) as of the effective date of any registration statement relating thereto, cause all such Registrable Securities to be listed on
each securities exchange on which similar securities issued by the Company are then listed, and, if not so listed, to be listed on the Nasdaq Stock Market; and 
  

 4 

 (j) as of the effective date of any registration statement relating thereto,
provide a transfer agent and registrar for all such Registrable Securities. 
 7. Expenses. The Company will pay all expenses incurred
by the Company in complying with this Agreement, including, without limitation, all registration and filing fees, exchange listing fees, printing expenses, transfer taxes, fees and expenses of counsel for the Company and the reasonable fees and
expenses of one counsel selected by the holders of a majority of the Registrable Securities to be included in such registration to represent them, state Blue Sky fees and expenses, and the expense of any special audits incident to or required by any
such registration, but excluding underwriting discounts and selling commissions relating to the sale of the Registrable Securities. 
 8.
Notification. The Company shall promptly notify each holder of Registrable Securities covered by any registration statement of any event which results in the prospectus included in such registration statement, as then in effect, containing an
untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing. 
 9. Indemnification and Contribution. 
 (a) Indemnification by the Company. The Company shall indemnify and hold harmless each holder or Registrable Securities included in any registration, its officers, directors and partners, each
underwriter of the Registrable Securities being sold by such holder, and each controlling person of any of the foregoing, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any prospectus, offering, circular, or other document relating to such Registrable Securities (or in any related registration statement, notification or the like) or any
omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any violation by the Company of the Act, or the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), or any applicable state securities laws, or any rule or regulation promulgated thereunder, applicable to the Company and relating to action or inaction required of the Company in connection with any registration,
qualification or compliance contemplated by this Agreement, and will reimburse each such holder, each of its officers, directors and partners, and each such underwriter and controlling person for any legal or any other expenses reasonably incurred
in connection with investigating or defending any such claim, loss, damage, liability or action, whether or not resulting in liability; provided, however, that the Company will not be liable in any such case to the extent that any such claim, loss,
damage or liability (i) arises out of or is based on any untrue statement or omission based upon and in conformity with written information furnished to the Company by such holder or underwriter and stated to be specifically for use therein
after the Company has furnished such holder with a sufficient number of copies thereof~, or (ii) results solely from the failure of such holder to deliver a copy of the registration statement, prospectus, offering circular or any amendments or
supplements thereto after the Company has furnished such holder with a sufficient number of copies thereof. 
  

 5 

 (b) Indemnification by the Holders of Registrable Securities. Each
participating holder of Registrable Securities shall, severally and not jointly, indemnify and hold harmless the Company, each of its directors, each of its officers who has signed the registration statement, each underwriter of the Registrable
Securities, each other participating holder of Registrable Securities, its officers, directors and partners, and each controlling person of any of the foregoing, against all claims, losses, damages and liabilities (or actions in respect thereof)
arising Out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any prospectus, offering circular, or other document relating to the Registrable Securities (or in any related registration statement,
notification or the like) or any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or by the failure of such holder to deliver a copy of the
registration statement, prospectus, offering circular, or any amendments or supplements thereto after the Company has furnished the holder with a sufficient number of copies thereof, and will reimburse the Company and each such director, officer or
controlling person for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, provided, however, that no holder of Registrable Securities will be liable in
any such case except to the extent that any such claim, loss, damage or liability arises out of any untrue statement or omission based upon and in conformity with written information furnished to the Company by such holder and stated to be
specifically for use therein, and provided, further, that no holder of Registrable Securities will be liable under this Section for losses, costs, damages or expenses exceeding in the aggregate the net proceeds to such holder in such offering.

 (c) Procedures for Indemnification. Each party entitled to indemnification under Subsection (a) or
(b) (the “Indemnified Party”) shall give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom; provided, that counsel for the Indemnifying Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party (whose approval shall not be unreasonably withheld); and, provided, further, that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party
of its obligations under this Agreement. The Indemnified Party may participate in such defense at such party’s expense; provided, however, that the Indemnifying Party shall pay such expenses if the Indemnified Party shall believe in good faith
that representation of such Indemnified Party by the counsel retained by the Indemnifying Party would be inappropriate due to actual or potential differing interests between the Indemnified Party and any other party represented by such counsel in
such proceeding. All expenses of an Indemnified Party hereunder shall be paid in advance by the Indemnifying Party, subject to receipt by the Indemnifying Party of an undertaking from the Indemnified Party to return such amounts if the Indemnified
Party is subsequently finally determined not to have been entitled to indemnification with respect to such expenses in accordance with this Agreement. No Indemnifying Party, in the defense of any such claim or litigation shall, except with the
consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all
liability in respect of such claim or litigation, and no Indemnified Party shall consent to entry of 

  

 6 

 
any judgment or settle such claim or litigation without the prior written consent of the Indemnifying Party. 
 (d) Contribution. If the indemnification provided for in Subsections (a) or (b) is unavailable to any Indemnified
Party thereunder in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to in such Sections, then each person or entity that would have been an Indemnifying Party thereunder shall contribute to the amount
paid or payable by such Indemnified Party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and
such Indemnified Party on the other. The relative fault shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates
to information supplied by the Indemnifying Party or such Indemnified Party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission, or whether such losses, claims,
damages or liabilities (or actions in respect thereof) arose out of the action or failure to act of one or more of such parties. Notwithstanding the foregoing, (i) no holder of Registrable Securities will be required to contribute any amount in
excess of the net proceeds to such holder of all Registrable Securities sold by such holder pursuant to such registration statement, and (ii) no person or entity guilty of fraudulent misrepresentation, within the meaning of Section 11(f)
of the Act, shall be entitled to contribution from any person or entity who is not guilty of such fraudulent misrepresentation. 
 10.
Reports Under Exchange Act. With a view to making available to the holders of Registrable Securities the benefits of Rule 144 promulgated under the Act and any other rule or regulation of the Commission that may at any time permit a holder to
sell securities of the Company to the public without registration or pursuant to a registration on Form S-3, the Company agrees to use its best efforts to satisfy the requirements of all such rules and regulations (including the requirements for
public information, registration under the Exchange Act and timely reporting to the Commission) at the earliest possible date (but in any event not later than 90 days) after the effective date of the registration statement for its first registered
public offering. The Company will furnish to each holder of Registrable Securities, whenever requested, a written statement as to its compliance with the reporting requirements of Rule 144, the Act and the Exchange Act, a copy of its most recent
annual or quarterly report, and such other reports and information filed by the Company as any Holder may reasonably request in connection with the sale of Registrable Securities without registration. 
 11. Registration Rights of Others. The Company will not, without the prior written consent of the holders of a majority of the Registrable
Securities, grant to any other person or entity the right to (a) require the Company to initiate the registration of any securities or (b) require the Company to include in any registration, securities owned by such holder, unless under
the terms of such arrangement, such holder may include securities in such registration only to the extent that the inclusion thereof does not limit the number of Registrable Securities included therein or adversely affect the offering price thereof.

 12. Lock-Up Agreement. Each holder of Registrable Securities agrees that in connection with an initial public offering of the
Company’s Common Stock and any other public 

  

 7 

 
offering of the Company’s Common Stock in which shares of Registrable Securities are being sold by such holder, and upon the request of the managing
underwriter in such offering, such holder will not sell, grant any option for the purchase of, or otherwise dispose of any of the Company’s securities held by such holder (other than those included in such registration) without the prior
written consent of such underwriter, for such period of time as may be requested by such underwriter (not to exceed (a) 180 days after the effective date of such registration, in the case of the initial public offering of the Company’s
Common Stock or (b) 90 days after the effective date of such registration, in the case of any other registration). In addition, for a period of two (2) years following the initial public offering of the Company’s successor’s
Common Stock, each holder of Registrable Securities (other than Riverside and its affiliates) agrees only to sell, grant an option for the purchase of, or otherwise dispose of Registrable Securities in such pro rata amount as Riverside and its
affiliates have sold prior to or contemporaneously with such proposed sale by the holder of Registrable Securities; provided that such restrictions shall not apply to (i) securities held by Stewart, (ii) up to 50% of the securities
held by Snow as of the date hereof, less any securities sold since such date and (iii) up to 5% every six (6) months of the securities held by Seubert as of the date hereof, less any securities sold since such date (provided such
securities are sold only following the expiration of any applicable lock-up period). The obligation of the holders of Registrable Securities under this Section 12 is conditional upon the agreement of all of the Company’s officers and
directors and of all persons holding 5% or greater of the Company’s capital stock to be bound by the terms of this Section 12. 
 13. Insider Trading Policy. At all times during which the Company is subject to the reporting requirements of the Act, the Company will use its reasonable best efforts to establish and maintain an internal policy with respect to
officers, directors, employees and related persons and entities who possess material, non-public information of the Company or any of its Subsidiaries (each, an “Insider”) in which (a) such Insiders are permitted to trade in the
Company’s equity securities only during the period commencing forty-eight (48) hours after the public release of quarterly or annual earnings and ending immediately preceding the 15th calendar day before the end of the next fiscal quarter;
and (b) notwithstanding clause (a) above, such Insiders may not, at any time, directly or indirectly, purchase, sell or engage in any derivative or other transaction involving any equity security issued by the Company if at the time of
such transaction such Insider is in possession of material, non-public information about the Company, except if such purchase or sale is “pursuant to a contract, instruction or plan” in compliance with Rule 10b5-1(c)( 1) of the Exchange
Act. 
 14. Notices. All notices, demands, requests or other communications hereunder shall be in writing and shall be deemed to have
been duly given if delivered in person, or by United States mail, certified or registered with return receipt requested, or by nationally recognized overnight courier service, to the address of a holder of Registrable Securities on the
Company’s stock records. 
 15. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns who acquire Registrable Securities; provided that the Company cannot assign its rights and obligations hereunder without the consent of the holders of the Registrable Securities. 

 

 8 

 16. Survival. This Agreement, including without limitation the obligation of the parties under
Section 8 hereof, shall survive indefinitely. 
 17. Severability and Governing Law. If any provision of this Agreement is
rendered void, invalid or unenforceable by any court of law for any reason, such invalidity or unenforceability shall not void or render invalid or unenforceable any other provision of this Agreement. This Agreement is governed by and construed in
accordance with the internal laws of the State of Delaware. 
 18. Amendments, Etc. This Agreement may be waived, amended or modified
only with the written consent of (i) the Company, (ii) Riverside and (iii) the holders of a majority of the Registrable Securities held beneficially by the Founders. Each holder of Registrable Securities will be given prior notice of
any proposed amendment, waiver or modification to this Agreement. 
 19. Termination of Rights. The rights of any particular holder of
Registrable Securities to cause the Company to register securities under this Agreement shall terminate with respect to such holder at such time as such holder is able to dispose of all of such holder’s Registrable Securities in one three-month
period pursuant to the provisions of Rule 144, provided that such holder holds not more than one percent of the outstanding Common Stock of the Company. 
 20. Joinder by Company. At such time as there exists a successor or parent corporation to APHLLC or APLLC as to which this Agreement applies, APHLLC or APLLC will cause such corporation to become a party to
this Agreement. 
 21. Counterparts. This Agreement may be executed in one or more counterparts, and with counterpart signature pages,
including facsimile counterpart signature pages, each of which shall be an original, but all of which together shall constitute one in the same Agreement. 
  

 9 

 In witness whereof, the parties hereto have executed and delivered this Agreement as a sealed instrument
as of the date first above written. 
  

													
	APPLIED PRECISION, INC.	 		 		 	RIVERSIDE FUND II, L.P.	 	
							
		 		 		 		 	 By:
	 	 Riverside Partners II, LLC
 its General
Partner
	 	
						
	By:	 	/s/ Donald V. Snow	 	CEO	 		 	 By:
	 	/s/ David Belluck
		 		 	(Title)	 		 		 	David Belluck	 	(Manager)
					
	/s/ Donald B. Snow	 		 		 	 DRW Venture Partners LP
	 	
	Donald Snow	 		 		 	 By:
	 	RBC Dain Rauscher Corp.	 	
		 		 		 		 		 	
						
	/s/ Ronald C. Seubert	 		 		 	 By:
	 	/s/ Mary Zimmer	 	
	Ronald C. Seubert	 		 		 		 	Mary Zimmer,	 	
		 		 		 		 	Director of Finance and Administration	 	
		 		 		 		 	 RBC CM
	 	
					
	/s/ John P. Stewart	 		 		 	 APPLIED PRECISION HOLDINGS, LLC
	 	
						
	John P. Stewart	 		 		 	 By:
	 	/s/ Ronald C. Seubert	 	President
		 		 		 		 		 	(Title)
					
		 		 		 	 APPLIED PRECISION, LLC
	 	
							
		 		 		 		 	 By:
	 	/s/ Ronald C. Seubert	 	President
		 		 		 		 		 	(Title)

  

 10

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