Document:

GT - Q4 2013 - Ex_10.2

    

THE GOODYEAR TIRE & RUBBER COMPANY
OUTSIDE DIRECTORS' EQUITY PARTICIPATION PLAN
(As Adopted February 2, 1996 and last Amended as of October 1, 2013)

1.    Purpose.  The purpose of the Plan is to enable The Goodyear Tire & Rubber Company (the "Company") to (a) attract and retain outstanding individuals to serve as non-employee directors of the Company, (b) further align the interests of non-employee directors with the interests of the other shareholders of the Company by making the amount of the compensation of non-employee directors dependent in part on the value and appreciation over time of the Common Stock of the Company, and (c) permit each non-employee director to defer receipt of all or a portion of his or her annual retainer until after retirement from the Board of Directors of the Company.

2.    Definitions.  As used in the Plan, the following words and phrases shall have the meanings specified below:
         
"Account" means any of, and "Accounts" means all of, the Equity Participation Accounts and the Retainer Deferral Accounts maintained in the records of the Company for Participants.
        
"Accrual" means any dollar amount credited to an Account, including Special Accruals, Quarterly Accruals, Retainer Deferral Accruals, Dividend Equivalents and Interest Equivalents.

"Beneficiary" means the person or persons designated by a Participant pursuant to Section 12.

"Board" means the Board of Directors of the Company.

"Committee" means the Compensation Committee of the Board.

"Common Stock" means the Common Stock, without par value, of the Company.  

"Conversion Date" means, with respect to each Account of each Retired Outside Director, the later of (i) the first business day of the seventh month following the month during which such Retired Outside Director terminated his or her service as a member of the Board, or (ii) the fifth business day of the calendar year following the calendar year during which such Retired Outside Director terminated his or her service as a member of the Board.  For all balances that are earned and vested after December 31, 2004, the term “termination of service” means a separation from service as defined in Section 409A of the Code.

"Dividend Equivalent" means, with respect to each dividend payment date for the Common Stock, an amount equal to the cash dividend per share of Common 
Stock which is payable on such dividend payment date.

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“Equity Grant Amount” means for each calendar quarter of service from October 1, 2008 through September 30, 2010, $23,750; for service from October 1, 2010 through December 31, 2011, $27,500; for service from January 1, 2012 through December 31, 2012, $28,750; for service from January 1, 2013 through December 31, 2013, $30,000; and for service on or after January 1, 2014, $31,250.
        
"Equity Participation Account" means a bookkeeping account maintained by the Company for a Participant to which Quarterly Accruals and Dividend Equivalents are credited in respect of Outside Directors through the Conversion Date (and, with respect to each Outside Director serving as a Director on February 2, 1996, a Special Accrual will be credited) and Interest Equivalents are credited on Dollar denominated amounts subsequent to the Conversion Date, which Account shall be denominated in Units until the Conversion Date and, thereafter, for Units granted prior to January 1, 2009 shall be denominated in dollars and for Units granted after December 31, 2008 (for service on or after October 1, 2008) shall be denominated in shares of Common Stock except any remaining fractional Unit shall be denominated in Dollars.

"Fair Market Value of Common Stock" means, in respect of any date on or as of which a determination thereof is being or to be made, the closing market price of the Common Stock reported on the New York Stock Exchange Composite Transactions Tape on such date, or, if the Common Stock was not traded on such date, on the next preceding day on which sales of shares of the Common Stock were reported on the New York Stock Exchange Composite Transactions tape.

"Interest Equivalent" has the meaning assigned in Section 11(C).

"Outside Director" means and includes each person who, at the time any determination thereof is being made, is a member of the Board and who is not and never has been an employee of the Company or any subsidiary or affiliate of the Company.

"Participant" means and includes, at the time any determination thereof is being made, each Outside Director and each Retired Outside Director who has a balance in his or her Accounts.

“Restricted Stock Unit” means the Units issued pursuant to a Restricted Stock Grant under Section 8 of the Company’s 2008 Performance Plan, or any successor equity compensation plan, so long as such Units remains subject to the restrictions and conditions specified in this Plan pursuant to which such Restricted Stock Grant is made.

"Retainer" means with respect to each Outside Director the retainer fee payable to such Outside Director by the Company, plus all meeting attendance fees payable by the Company to such Outside Director, in respect of a calendar quarter.

"Retainer Deferral Account" means a bookkeeping account maintained by the Company for a Participant to which Retainer Accruals and Dividend Equivalents are credited through the Conversion Date and Interest Equivalents on Dollar denominated 

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amounts are credited subsequent to the Conversion Date, which Account shall be denominated in Units until the Conversion Date and, thereafter, for Units created prior to January 1, 2011 shall be denominated in dollars and for Units created after December 31, 2010 shall be denominated in shares of Common Stock except any remaining fractional Unit shall be denominated in Dollars.
            
"Retired Outside Director" means an Outside Director who has terminated his or her service as a member of the Board and is entitled to receive distributions in respect of his or her Account or Accounts as provided in Section 10.

"Plan" means The Goodyear Tire & Rubber Company Outside Directors' Equity Participation Plan, the provisions of which are set forth herein.
    
"Quarterly Accrual" has the meaning assigned in Section 7.
            
"Retainer Deferral Accrual" has the meaning assigned in Section 8.

"Special Accrual" has the meaning assigned in Section 7.

"Unit" means an equivalent to a hypothetical share of Common Stock which is the denomination into which all dollar Accruals (other than Interest Equivalents) to any Account are to be translated.  Upon the Accrual of any dollar amount to any Account on or prior to the Conversion Date thereof, such dollar amount shall be translated into Units by dividing the dollar amount of such Accrual by the Fair Market Value of the Common Stock on the day on or as of which such Accrual to the Account is made or, if not made on a day on which the New York Stock Exchange is open for trading, on the trading day next following the date of the Accrual.  Additionally, each Restricted Stock Unit granted is equal to one Unit.  Units, and the translation thereof from dollars, shall be calculated and recorded in the Accounts rounded to the fourth decimal place.

"Year of Service" means, with respect to each Outside Director, the twelve month period commencing with the date of the individuals' election as an Outside Director or any anniversary thereof.

3.    Effective Date.  The Plan is adopted on, and is effective on and after, February 2, 1996.

4.    Eligibility.  Each person who serves as an Outside Director at any time subsequent to February 1, 1996 is eligible to participate in the Plan.    

5.    Administration.  Except with respect to matters expressly reserved for action by the Board pursuant to the provisions of the Plan, the Plan shall be administered by the Committee, which shall have the exclusive authority except as aforesaid to take any action necessary or appropriate for the proper administration of the Plan, including the full power and authority to interpret the Plan and to adopt such rules, regulations and procedures consistent with the terms of the Plan as the Committee deems necessary or appropriate.  The Committee's interpretation of the Plan, and all actions taken within the scope of its authority, shall be final and binding on the Company and the Participants.

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6.    Equity Participation Accounts.  There shall be established and maintained by the Company an Equity Participation Account with respect to each Outside Director to which Accruals or Grants of Restricted Stock Units shall be made from time to time in accordance with the provisions of the Plan.

		
	7.
	(A)  Quarterly Accruals.  On the first day of each calendar quarter, commencing April 1, 2007 and ending on October 1, 2008 for service through September 30, 2008, the Company shall credit $23,750 ($20,000 in respect of each quarter during the period beginning July 1, 2005 and ended on December 31, 2006, $17,500 in respect of each quarter during the period beginning July 1, 2004 and ended on June 30, 2005, $7,500 in respect of each quarter during the period beginning January 1, 2003 and ended on June 30, 2004, $2,500 in respect of each quarter during the period beginning July 1, 1998 and ended on December 31, 2002 and $2,000 in respect of each quarter during the period beginning April 1, 1996 and ended on June 30, 1998) to the Equity Participation Account of each Outside Director who is then a member of the Board of Directors and served as a member of the Board for the entire calendar quarter ended immediately prior to such day (each a "Quarterly Accrual").

(B) (1) Special Accruals.  The Company shall credit to the Equity Participation Account of each Outside Director who was an Outside Director on January 1, 2007, a $3,750 accrual as of April 2, 2007.

(B) (2)    Special Accruals.  On April 13, 2004, the Company shall credit to the Equity Participation Account of each Outside Director eligible to receive a quarterly accrual as of  April 1, 2004, an additional credit in the amount of $20,000.

(B) (3) Special Accruals.  On February 2, 1996, the Company shall credit to the Equity Participation Account of each Outside Director then serving as a member of the Board of Directors a special, one-time credit (a "Special Accrual"), the amount of which shall be determined in accordance with the following formula:
                                                                                                    N       
SP = [FRPA - FQC] / 1.01943 

where,
SP is the dollar amount of the Special Accrual in respect of a participating Outside Director at February 2, 1996;
FRPA is the future value of an annuity at age 70 under the Retirement Plan for Outside Directors (as provided by Watson Wyatt and based on the UP-1984 mortality table) that would be needed to provide a lifetime annuity at age 70 assuming the benefit increases 3% per year starting in 1997.
FQC is the future value of quarterly accruals, calculated on the value at age 70 of $1,000 quarterly accruals to the Equity Participation Account of the participating Outside Director starting April 1, 1996, assuming a compound annual growth rate of 8%.
N is the number of quarters until the Outside Director retires having attained age 70.

(C)  Restricted Stock Units Grant.  Effective for service on or after October 1, 2008 to be granted January 1, 2009 and on the first day of each succeeding calendar quarter, each Outside 

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Director who is then a member of the Board of Directors and served as a member of the Board for any portion of the calendar quarter ended immediately prior to such day, will be granted the number of Restricted Stock Units that will be equal to the applicable Equity Grant Amount (or the pro-rata amount based on the number of days of service in the quarter if the Outside Director did not serve the whole quarter) divided by the Fair Market Value of Common Stock for such grant date, or if the New York Stock Exchange is not open for trading on such date, the grant date shall be the next following trading date.  For the last quarterly grant with respect to the last quarter of Board service, any fractional amount of the applicable Equity Grant Amount (or the pro-rata amount based on the number of days of service in the quarter if the Outside Director did not serve the whole quarter) that is not utilized in converting the grant into whole shares of Restricted Stock when added to any outstanding fractional Restricted Stock Unit shall be paid in cash when the shares are distributed pursuant to 10.(C).  Effective for grants made in respect of service on or after October 1, 2010, the Restricted Stock Units are further restricted by only ratably vesting over three years, subject to accelerated full vesting upon becoming a Retired Outside Director.
 
(D)  Translation of Accruals into Units.  Each Accrual (other than Interest Equivalents) to an Equity Participation Account shall be translated into Units by dividing the dollar amount thereof by the Fair Market Value of the Common Stock on the day as of which such Accrual is made, or, if the date on or as of which such Accrual is made is not a day on which the New York Stock Exchange is open for trading, on the next following trading day.  Upon such translation of an Accrual into Units, the resulting number of Units shall be credited to the relevant Equity Participation Account (in lieu of the dollar amount of such Accrual) and such Accrual shall continue to be denominated in such number of Units until the Conversion Date for such Account, when those Units derived from Accruals (as compared to Units from Restricted Stock Unit Grants) will be converted into a dollar amount equal to the product of (i) the number of Units credited to such Account on such Conversion Date, multiplied by (ii) the Fair Market Value of the Common Stock on such Conversion Date.

8.    Retainer Deferral Accounts.  Each Outside Director may, at his or her sole election, defer receipt of 25%, 50%, 75% or 100% of his or her Retainer payable in respect of and during any calendar year by electing to have such amount credited to his or her Retainer Deferral Account (herein referred to as a "Retainer Account Accrual").  Each deferral election, if any, shall be made by an Outside Director annually, must be in respect of an entire calendar year and shall be made not later than, and shall become irrevocable as of, June 30th of the year prior to the calendar year in respect of which such election is being made.  The dollar amount of each Retainer Account Accrual shall be translated (in the manner specified in Section 7(D)) into Units on the date such Retainer Account Accrual is credited to the relevant Retainer Deferral Account, which shall be the day on which the payment of such portion of the Retainer would have been made absent the election of the Outside Director to defer the payment of all or a portion thereof.  Upon such translation into Units, the resulting number of Units shall be credited to the relevant Retainer Deferral Account (in lieu of the dollar amount of such Accrual) and such Accrual shall continue to be denominated in such number of Units until the Conversion Date, when for Units in respect of deferrals elected prior to January 1, 2011 applicable to plans years through December 31, 2010, the Units will be converted into a dollar amount equal to the product of (i) the number of Units credited to such Retainer Deferral Account on such Conversion Date, multiplied by (ii) the Fair Market Value of the Common Stock of such Conversion Date.  For Units relating to deferrals effective on or after January 1, 2011, each Unit will be converted to 

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a share of Common Stock and all such shares of Common Stock will be delivered on the fifth business day of the calendar quarter following the quarter of his or her separation from Board service with any remaining fractional Unit paid in cash at that time.

9.     Dividend Equivalents.  With respect to each Account and Restricted Stock Unit, from time to time through the relevant Conversion Date each Unit in such Account and Restricted Stock Unit shall be credited with a Dividend Equivalent at the same time as cash dividends are paid on shares of the Common Stock.  Dividend Equivalents credited to each Account and Restricted Stock Unit shall be automatically translated into Units or Restricted Stock Units by dividing the dollar amount of such Dividend Equivalents by the Fair Market Value of the Common Stock on the date the relevant Dividend Equivalent is accrued to such Account and Restricted Stock Unit.   The number of Units or Restricted Stock Units resulting shall be credited to such Account and Restricted Stock Unit (in lieu of the dollar amount of such Accrual) and such Accrual shall be denominated in Units until the Conversion Date.

10.    Eligibility For Benefits.  (A) Equity Participation Accounts. (1)  For all balances that were earned and vested prior to January 1, 2005, each Retired Outside Director shall be entitled to receive the balance of his or her Equity Participation Account in accordance with the provisions of Section 11 of the Plan, unless the Board of Directors acts to reduce the amount of, or to deny the payment of, the Equity Participation Account of such Retired Outside Director; provided, however, that the Board of Directors shall not have the authority to reduce the amount of, or to deny the payment of, the Equity Participation Account of any Outside Director who terminates his or her service on the Board of Directors if (i) prior to such termination of service, the Retired Outside Director either (x) had five or more years of service and had attained age 70, or (y) had ten or more years of service and had attained age 65, or (ii) such termination was due to the death of the Outside Director.  Notwithstanding the foregoing, the Board may at any time deny the payment of, or reduce the amount of, the Equity Participation Account of any Participant if, in the opinion of the Board, such Participant was engaged in an act of misconduct or otherwise engaged in conduct contrary to the best interest of the Company.  (2)  For all balances that are earned or vested after December 31, 2004, each Retired Outside Director shall be entitled to receive the balance of his or her Equity Participation Account in accordance with the provisions of Section 11 of the Plan for Units that are to be paid in Dollars (Units granted from Accruals prior to January 1, 2009).  Notwithstanding the foregoing, the Board may at any time deny the payment of, or reduce the amount of, the Equity Participation Account of any Participant if, in the opinion of the Board, such Participant was engaged in an act of misconduct or otherwise engaged in conduct detrimental to the Company.

		
	(B)
	Retainer Deferral Accounts.  Each Retired Outside Director shall be entitled to receive the balance, if any, of his or her Retainer Deferral Account in accordance with the provisions of Section 11 of the Plan.

		
	(C)
	Restricted Stock Units.   Each Outside Director will receive shares of Common Stock for their Restricted Stock Units on the fifth business day of the calendar quarter following the quarter of his or her separation from Board service.  Notwithstanding the foregoing, the Board may at any time deny the payment of, or reduce the amount of, the Restricted Stock Units of any Participant if, in the opinion of the Board, such Participant was engaged in an act of misconduct or otherwise engaged in conduct detrimental to the Company.

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11.    Payment of Accounts.  (A)  All distributions of Equity Participation Accounts and Retainer Deferral Accounts to Participants shall be made in cash or Common Stock pursuant to the terms of the Accrual, Grant or deferral according to the provisions of the Plan.

(B) In the case of each Retired Outside Director, the Units credited to his or her Equity Participation Account and Retainer Deferral Account, respectively, shall, on the Conversion Date for such Retired Outside Director, be converted to a dollar denominated amount by multiplying the number of Units that are to be paid in Dollars in each of the Accounts by the Fair Market Value of the Common Stock on such Conversion Date and for Units that are to be paid in Common Stock, each Unit is equal to one share.

(C)  For all balances that were earned and vested prior to January 1, 2005, from and after the Conversion Date until paid, the balance (expressed in dollars) of the Equity Participation Account, and, if any, of the Retainer Deferral Account, of each Retired Outside Director shall be credited monthly until paid with "Interest Equivalents", which shall be equal to one-twelfth (1/12th) of the product of (x) the dollar balance of such Account, multiplied by (y) the sum (expressed as a decimal to six places) of the rate equivalent to the prevailing annual yield of United States Treasury obligations having a maturity of ten years (or, if not exactly ten years, as close to ten years as possible without exceeding ten years) at the Conversion Date, plus one percent (1%).

(D) (1)  For all balances that were earned and vested prior to January 1, 2005, the Accounts of each Retired Outside Director will be paid in ten (10) annual installments commencing on the fifth business day following the Conversion Date with respect to such Accounts, and thereafter on each anniversary of such Conversion Date; each installment to be in an amount equal to the total dollar balance of such Accounts on the fifth     business day prior to the date such annual installment is due and payable divided by the number of installments remaining (including the annual installment then being calculated for payment) to be paid.

(D) (2)  For all balances that are earned or vested after December 31, 2004, the payment of such balance for Units that are to be paid in Dollars (Units created from Accruals prior to January 1, 2009) shall be made in a lump sum payment on the fifth business day following the Conversion Date in respect of such Retired Outside Director.  For Units relating to deferrals effective on or after January 1, 2011, each Unit will be converted to a share of Common Stock and all such shares of Common Stock will be delivered on the fifth business day of the calendar quarter following the quarter of his or her separation from Board service with any remaining fractional Unit paid in cash at that time.

(E)  For all balances that were earned and vested prior to January 1, 2005, the Committee may, in its sole discretion, elect to pay the Equity Participation Account or the Retainer Deferral Account, or both,  of any Retired Outside Director in a lump sum or in fewer than ten installments.  In the event that the Committee shall elect to make a lump sum payment of an Account of any Retired Outside Director (or to make payment thereof in fewer than ten annual installments), the payment of such lump sum shall be made (or such installments shall commence) on the fifth business day following the Conversion Date in respect of such Retired Outside Director.

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(F)  In the event of the death of an Outside Director, the entire balance of his or her Accounts shall be eligible for payment which shall be made in a lump sum on the Conversion Date for his or her Accounts.

(G)  In the event of the death of a Retired Outside Director, the entire balance of his or her Accounts(s) shall be paid on the Conversion Date for his or her Accounts (if it has not occurred) or on the next occurring anniversary thereof.

12.    Designation of Beneficiary.  A Participant may designate a person or persons (the "Beneficiary") to receive, after the Participant's death, any remaining benefits payable under the Plan.  Such designation shall be made by the Participant on a form prescribed by the Committee. The Participant may at any time change or revise such designation by filing a new form with the Committee.  The person or persons named as beneficiary in the designation of beneficiary form duly completed and filed with the Company bearing the most recent date will be the Beneficiary. All payments due under the Plan after the death of a  Participant shall be made to his or her Beneficiary, except that (i) if the Participant does not designate a Beneficiary or the Beneficiary predeceases the Participant, any remaining benefits payable under the Plan after the Participant's death shall be paid to the Participant's estate, and (ii) if the Beneficiary survives the Participant but dies prior to receiving the benefits payable under the Plan, the benefits under the Plan shall be paid to the Beneficiary's estate.

13.    Amendment and Termination.  The Board may at any time, or from time to time, amend or terminate the Plan; provided, however, that no such amendment or termination shall reduce Plan benefits which accrued prior to such amendment or termination without the prior written consent of each person entitled to receive benefits under the Plan who is adversely affected by such action; and, provided further, that the Plan shall not be amended more frequently than once every six months, other than to comply with changes in the Internal Revenue Code, the Employee Retirement Income Security Act, or the rules promulgated thereunder.

Notwithstanding the foregoing, no termination or amendment of this Plan may accelerate payment of post-2004 benefits to any Participant except under the following conditions:

(1)  The Company may terminate and liquidate the Plan within 12 months of a corporate dissolution taxed under section 331 of the Internal Revenue Code, or with the approval of a bankruptcy court pursuant to 11 U.S.C. §503(b)(1)(A), provided that the amounts deferred under the Plan are included in the Participants’ gross incomes in the latest of the following years (or, if earlier the taxable year in which the amount is actually or constructively received): (a) the calendar year in which the Plan termination and liquidation occurs; (b) the first calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (c) the first calendar year in which the payment is administratively practicable.  

(2) The Company may terminate and liquidate the Plan pursuant to irrevocable action taken by the Board of Directors within the 30 days preceding or the 12 months following a change in control event (as defined in Treasury Regulation §1.409A-3(i)(5)), provided that this paragraph will only apply to a payment under a plan if all agreements, methods, programs, and other arrangements sponsored by the Company immediately after the time of the change in control event with respect to which deferrals of compensation are treated as having been deferred under a single plan under Treasury Regulation §1.409A-1(c)(2) are terminated and 

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liquidated with respect to each Participant that experienced the change in control event, so that under the terms of the termination and liquidation all such participants are required to receive all amounts of compensation deferred under the terminated agreements, methods, programs and other arrangements within 12 months of the date the Company irrevocably takes all necessary action to terminate and liquidate the agreements, methods, programs, and other arrangements.

(3) The Company may terminate and liquidate the Plan, provided that (a) the termination and liquidation does not occur proximate to a downturn in the financial health of the Company; (b) the Company terminates and liquidates all agreements, methods, programs, and other arrangements sponsored by the Company that would be aggregated with any terminated and liquidated agreements, methods, programs, and other arrangements under Treasury Regulation §1.409-1(c) if any Participant had deferrals of compensation under all of the agreements, methods, programs, and other arrangements that are terminated and liquidated; (c) no payments in liquidation of the Plan are made within 12 months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan other than payments that would be payable under the terms of the Plan if the action to terminate and liquidate the Plan had not occurred; (d) all payments are made within 24 months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan; and (e) the Company does not adopt a new plan that would be aggregated with any terminated and liquidated plan under Treasury Regulation §1.409A-1(c) if the same service provider participated in both plans, at any time within three years following the date the service recipient takes all necessary action to irrevocably terminate and liquidate the Plan.

14.    Plan Unfunded, Rights Unsecured.  With respect to the Equity Participation Account and the Retainer Deferral Account, the Plan is unfunded.  Each Account under the plan represents only a general contractual conditional obligation of the Company to pay in cash or shares of Common Stock the balance thereof in accordance with the provisions of the Plan.  All Restricted Stock Units or shares of Common Stock granted or payable under the Plan will be made from and pursuant to the Company’s 2008 Performance Plan, or any successor equity compensation plan. 

15.    Assignability.  All payments under the Plan shall be made only to the Participant or his or   
her duly designated Beneficiary (in the event of his or her death).  Except pursuant to Section 12 or the laws of descent and distribution and except as may be required by law, the right to receive payments under the Plan may not be assigned or transferred by, and are not subject to the claims of creditors of, any Participant or his or her Beneficiary during his or her lifetime.

16.    Change in the Common Stock.  In the event of any stock dividend, stock split, recapitalization, merger, split-up or other change affecting the Common Stock of the Company, the Units in each Account shall be adjusted in the same manner and proportion as the change to the Common Stock.

17.    Quarterly Statements of Accounts - Valuation.  Each calendar quarter the Company will prepare and send to each Participant a statement reporting the status of his or her Account or Accounts and Restricted Stock Units as of the close of business on the last business day of the prior calendar quarter.  To the extent an Account is denominated in Units, the value of the Units 

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and Restricted Stock Units will be reported at the Fair Market Value of the Common Stock on the relevant valuation date.

18.    No Other Rights.  Neither the establishment of the Plan, nor any action taken thereunder, shall in any way obligate the Company to nominate an Outside Director for re-election or continue to retain an Outside Director on the Board or confer upon any Outside Director any other rights in respect of the Company.

19.    Successors of the Company.   The Plan shall be binding upon any successor to the Company, whether by merger, acquisition, consolidation or otherwise.

20.    Law Governing.  The Plan shall be governed by the laws of the State of Ohio.

THE GOODYEAR TIRE & RUBBER COMPANY

By:       /s/ Joseph B Ruocco                
Joseph B Ruocco
Senior Vice President, Human Resources

ATTEST:

By:    /s/ Bertram Bell     
Bertram Bell
Assistant Secretary

10Converted by EDGARwiz

PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is made by and between SOUTHERN TULSA, LLC, a Georgia limited liability company (“Purchaser”), and NATIONWIDE HEALTH PROPERTIES, LLC, a Delaware limited liability company (“Seller”), effective as of _____________, 2013 (the “Effective Date”).

R E C I T A L S

A.

Seller is the owner of a fee simple interest in that certain real property located in Tulsa County, Oklahoma, as more particularly described on Exhibit A attached hereto, which real property is improved with a continuing care retirement community located at 5170 S. Vandalia, Tulsa, Oklahoma (referred to herein from time to time as the “Facility”).  Such real property, Facility, any other improvements located on such real property, together with all appurtenances relating thereto, and the personal property owned by Seller and located on such real property, are collectively referred to herein as the “Property.”

B.

Seller desires to sell the Property to Purchaser, and Purchaser desires to purchase the Property from Seller, in accordance with the terms and conditions contained in this Agreement.  

A G R E E M E N T

NOW, THEREFORE, for and in consideration of the covenants, agreements and promises herein contained, and in consideration of the payment of the purchase price as stated below, and for other good and valuable consideration, the parties do hereby covenant and agree as follows:

1.

Agreement to Buy and Sell.  Seller agrees to sell to Purchaser, and Purchaser agrees to purchase from Seller, the Property upon the terms and conditions set forth in this Agreement.

2.

Purchase Price; Terms.  The purchase price for the Property (the “Purchase Price”) shall be Five Million Dollars ($5,000,000.00).  The Purchase Price shall be paid by Purchaser to Seller in immediately available cash at the Closing (as defined below).

3.

Deposit; Liquidated Damages.  

(a)

Within two (2) business days after the Effective Date, Purchaser shall deliver to Fidelity National Title Insurance Company, 2828 Routh Street, Suite 800, Dallas, Texas 75201, Attn:  Stephany Roppolo (the “Title Company”), as escrow holder, the sum of One Hundred Twenty-Five Thousand Dollars ($125,000) (the “Initial Deposit”), which shall be held in escrow by the Title Company in accordance with the terms of this Agreement.  Additionally, within two (2) business days after the Due Diligence Expiration Date (as defined below), Purchaser shall deliver to the Title Company, as escrow holder, the sum of Fifty Thousand Dollars ($50,000) (the “Additional Deposit,” and together with the Initial Deposit, the “Deposit”),  which shall be held in escrow by the Title Company in accordance with the terms of this Agreement.  

(b)

The Deposit shall be deposited by the Title Company in an interest-bearing deposit account, and all interest earned thereon shall accrue to the benefit of Purchaser.  The Deposit, and all interest thereon, shall be applied toward payment of the Purchase Price at the Closing, provided the Closing occurs.  If the Closing does not occur due to a breach of this Agreement by Purchaser, Seller may terminate this Agreement and retain the Deposit, including accrued interest, as liquidated damages, and neither party shall have any further rights, duties or obligations under this Agreement.  If the Closing does not occur solely due to 

51666.5

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a breach of this Agreement by Seller, Purchaser may either, as its sole and exclusive remedy, (x) enforce specific performance of this Agreement, or (y) terminate this Agreement and receive the return of the Deposit and all interest thereon.  Nothing contained in this Agreement limits Seller’s liability for a breach by Seller of any representations, covenants, indemnities or obligations that survive the Closing, and Purchaser will have the right to pursue any remedies available at law or in equity against Seller for a breach of such representations, covenants, indemnities and obligations; provided, however, in no event shall Seller ever be liable to Purchaser hereunder for any punitive, speculative or consequential damages.  This Agreement, together with such further instructions, if any, as the parties shall provide to the Title Company by written agreement, shall constitute the escrow instructions to the Title Company, including without limitation the standard printed general escrow instructions of the Title Company, incorporated herein by this reference.

IN THE EVENT SELLER IS ENTITLED TO RETAIN THE DEPOSIT PURSUANT TO THE FOREGOING SECTION 3(b), THE DEPOSIT, ALONG WITH ACCRUED INTEREST, SHALL BE RETAINED BY SELLER AS LIQUIDATED DAMAGES.  THE PARTIES HERETO EXPRESSLY AGREE AND ACKNOWLEDGE THAT SELLER’S ACTUAL DAMAGES IN THE EVENT OF A DEFAULT BY PURCHASER WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO ASCERTAIN AND THAT THE AMOUNT OF THE DEPOSIT REPRESENTS THE PARTIES’ REASONABLE ESTIMATE OF SUCH DAMAGES.  

Purchaser’s Initials: __________     Seller’s Initials:__________

(c)

The parties hereto expressly agree that if the parties give the Title Company contradictory instructions, the Title Company shall have the right at its election to file an action in interpleader requiring the parties to answer and litigate their several claims and rights among themselves and the Title Company is authorized to deposit with the clerk of the court all documents and funds held pursuant to this Agreement.  If such action is filed, the parties agree to pay the Title Company’s cancellation charges and costs, expenses and reasonable attorneys’ fees which the Title Company is required to expend or incur in the interpleader action, the amount thereof to be fixed and judgment therefor to be rendered by the court.  Upon the filing of such an action, the Title Company shall thereupon be fully released and discharged from all obligations to further perform any duties or obligations otherwise imposed by the terms of this Agreement or any other instructions given to the Title Company hereunder. 

4.

Due Diligence Period.  

(a)

Within five (5) business days after the Effective Date, Seller shall deliver or cause to be delivered to Purchaser:  (i) any existing title policies for the Property; (ii) copies of the property tax billings associated with the Property for the last two (2) years; (iii) any ALTA survey of the Property currently in Seller’s possession; (iv) any property or building condition reports in Seller’s possession with respect to the Property; and (v) any soil, engineering or environmental reports in Seller’s possession with respect to the Property (collectively, the “Due Diligence Materials”).  

(b)

Purchaser shall have the right to obtain a new or updated title commitment and/or survey for the Property and Purchaser shall provide copies of any such updates to Seller within five (5) business days after its receipt thereof.  At least five (5) business days prior to the Due Diligence Expiration Date (as defined below), Purchaser shall give Seller notice of any title exceptions or other matters set forth in Seller’s title policies or surveys or any updates thereof as to which Purchaser objects in its sole and absolute discretion.  Seller shall have the right, but not the obligation, to remove, satisfy, cause the Title Company to insure over or otherwise cure any such exception or other matter as to which Purchaser so objects.  If Seller is unable or unwilling to take such actions as may be required to cure such objections.  Seller shall give Purchaser notice thereof, it being understood and agreed that the failure of Seller to give such notice within three (3) 

51666.5

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business days after its receipt of Purchaser’s notice of objection shall be deemed an election by Seller not to remedy such matters.  If Seller shall be unable or unwilling to remove any title defects to which Purchaser has so objected, Purchaser shall elect either (i) to terminate this Agreement (in whole but not in part) or (ii) to proceed to the Closing notwithstanding such title defect without any abatement or reduction in the Purchase Price on account thereof.  Those title or survey matters to which Purchaser does not object to hereunder, or to which Purchaser objects and Seller elects (or is deemed to have elected) not to cure and Purchaser nonetheless elects to proceed to Closing, shall be referred to herein collectively as the “Permitted Exceptions.”  Purchaser shall make any such election by written notice to Seller given on or prior to the Due Diligence Expiration Date; provided, however, if Seller commences to cure a title defect and then elects not to complete such cure, Purchaser shall have the right to terminate this Agreement by written notice to Seller within three (3) business days after Seller notifies Purchaser thereof.  The failure of Purchaser to give such notice shall be deemed an election by Purchaser to proceed to Closing.  If Purchaser terminates this Agreement in accordance with this Section 4(b), the Title Company shall return the Deposit, together with accrued interest, to Purchaser and neither party shall have any further rights or obligations hereunder, except those obligations that specifically survive the termination hereof.  

(c)

On or before the date (the “Due Diligence Expiration Date”) that is thirty (30) calendar days after the Effective Date, Purchaser shall have completed its due diligence investigation of the Property.  At any time prior to the Due Diligence Expiration Date, Purchaser may notify Seller expressly and in writing that Purchaser has determined, for any reason or no reason, in its sole and absolute discretion that it will not complete the proposed acquisition of the Property, and is thereby terminating this Agreement (the “Termination Notice”).  If Seller does not receive the Termination Notice on or before the Due Diligence Expiration Date, then, absent a default solely on the part of Seller under this Agreement and except as set forth in Section 5 or Section 7 below, the Deposit shall become nonrefundable to Purchaser and Purchaser shall be obligated to close on its purchase of the Property upon the satisfaction of the conditions precedent in favor of Purchaser set forth in Section 6(b) below, with all other conditions precedent in favor of Purchaser then being deemed satisfied or waived. 

(d)

At any time between the Effective Date and the Due Diligence Expiration Date, subject to the rights of Operator under the Facility Lease (both as defined below) and upon twenty-four (24) hours prior written notice to Seller, Purchaser and its agents, employees and contractors shall have the right to enter the Property during reasonable business hours, at times acceptable to Operator, and, while thereon, make surveys, investigations and appraisals, take measurements, make structural, mechanical, architectural, zoning, land use, market and engineering studies, and make any other inspections and studies of the Property deemed appropriate by Purchaser, all at Purchaser’s expense; provided, however Purchaser shall not (i) take any samples of materials of any kind from the Property, or (ii) perform any physically invasive procedure at the Property (such as a Phase II environmental audit) without, in each case, the prior written consent of Seller, which consent will not be unreasonably withheld.  Purchaser will cooperate with Seller and/or Operator to conduct the investigations, analyses, surveys, and reviews contemplated in this Section 4(d) in such a manner as to cause as little disruption to the business conducted at the Property as possible.

(e)

Seller hereby agrees to use commercially reasonable efforts to cause Operator to cooperate with Purchaser in connection with its investigation of the Property pursuant to Section 4(d) above; provided, however, the foregoing shall not be deemed to require Seller to expend any money, incur any expense or institute any judicial or other proceeding against Operator in connection therewith.  Additionally, Purchaser may contact Operator and its representatives in connection with its due diligence review of the Property; provided, however, Purchaser may only interview or otherwise communicate (in person, by phone or otherwise) with Operator and/or its employees or representatives with the participation of a representative of Seller, unless Seller specifically consents to the contrary in writing in each instance.  Seller hereby agrees to make a representative of Seller reasonably available for such purpose during regular business hours on business 

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days, but only upon reasonable advance notice from Purchaser.  As of the Effective Date, Seller’s representative for purposes of this Section 4(e) shall be Humair Sabir (hsabir@Ventasreit.com); provided, however, Seller shall have the right to designate a different representative from time to time.  Purchaser agrees that in connection with its investigation of the Property or contact with Operator or its employees or representatives, Purchaser shall not unreasonably disrupt or interfere with the operations at the Property or Seller’s business relationship with Operator.  Upon Seller’s reasonable determination that Purchaser has violated the preceding sentence, Seller shall have the right, exercisable in its sole and absolute discretion, to limit, restrict or prohibit any further communication between Purchaser and Operator.

(f)

If Purchaser exercises its rights under Section 4(d) above, it shall keep the Property free and clear of any liens or claims resulting therefrom, and Purchaser shall indemnify, defend (with counsel reasonably satisfactory to Seller), protect and hold harmless Seller and Operator from and against any and all liability, loss, cost, damage or expense (including, without limitation, attorneys’ fees and costs) that Seller may sustain or incur by reason of or in connection with any tests made by Purchaser or Purchaser’s agent or contractors relating to or in connection with the Property or entries by Purchaser or its agents or contractors onto the Property.  Purchaser shall restore any portion of the Property damaged by such exercise to substantially the same condition immediately before such exercise.  The rights and obligations of the parties under this subsection shall survive Closing or any earlier termination of this Agreement.  Purchaser shall use care and consideration in connection with all of its inspections.  Prior to any entry on the Property by Purchaser or its agents or consultants, Purchaser shall secure and maintain, or shall cause its agents and consultants to secure and maintain, the following insurance written by insurers that have an A.M. Best Rating of A-VII or better :  (i) a commercial general liability policy (including contractual liability and independent contractors liability) written on an occurrence policy form, in an amount of not less than One Million Dollars ($1,000,000) each occurrence and Three Million Dollars ($3,000,000) in the aggregate and with a deductible (or self-insured retention) in an amount not to exceed $10,000, which will cover the activities and actions of Purchaser and its agents and consultants on the Property and shall name Seller and its direct and indirect subsidiaries and affiliates, and their respective agents, beneficiaries, members, managers, partners, employees and any mortgagee of Seller or any ground lessor, as well as Operator, as additional insureds thereunder, (ii) workers’ compensation and employer’s liability insurance in accordance with the provisions of Oklahoma law; and, (iii) business auto liability insurance covering all owned, non-owned and hired vehicles in an amount of not less than One Million Dollars ($1,000,000) each accident.  Such insurance required in this Section 4(f) shall be primary and non-contributory with any insurance maintained by Seller or Operator.  Purchaser shall provide a certificate of insurance to Seller evidencing the insurance required herein prior to any entry on the Property by Purchaser or its agents or consultants.  If the commercial general liability insurance coverage is written on a claims-made policy form, such coverage shall have a retroactive date not later than the Effective Date and Purchaser shall for a period of two (2) years after completion of Seller’s due diligence, including physical inspections of the Property, (A) maintain commercial general liability insurance, at Purchaser’s sole cost and expense, satisfying the foregoing, or (B) secure “tail” or extended reporting coverage.  This provision shall survive the Closing or any earlier termination of this Agreement.

(g)

In consideration for Seller granting to Purchaser the right to inspect the Property and allowing Purchaser access to the Property for the purposes of its due diligence, Purchaser has paid to Seller concurrently with the execution of this Agreement the sum of One Hundred Dollars ($100), cash-in-hand, which amount constitutes independent consideration, separate and apart from the Purchase Price and is non-refundable under any circumstances, and shall be retained by Seller notwithstanding any other provisions of this Agreement in consideration of the rights and options granted by Seller under this Agreement.

(h)

If this Agreement terminates for any reason, Purchaser shall (i) deliver to Seller a copy of any tests, audits, surveys, reports, studies and the results of any and all investigations and inspections performed for Purchaser by third parties which are requested in writing by Seller within ten (10) days of such 

51666.5

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request (excluding any proprietary materials and materials subject to the attorney-client and/or work product privilege); and (ii) return to Seller or certify the destruction of any and all Due Diligence Materials given to Purchaser by or on behalf of Seller within ten (10) days of the termination of this Agreement.  The foregoing covenants of Purchaser shall survive any such termination of this Agreement.

(i)

Purchaser agrees that any Due Diligence Material provided by Seller or Seller’s agents or brokers to Purchaser is provided for illustrative purposes only, and is not warranted by Seller as to accuracy, completeness, reliability or in any other manner.

5.

Operations Transfer Agreement.  As of the Effective Date, the Property is leased by Seller to SH CCRC, LLC (“Operator”) pursuant to the terms of that certain Lease dated as of November 1, 2007 (as amended to date, the “Facility Lease”).  On or before forty-five (45) days from the Effective Date (the “Outside OTA Date”), Purchaser shall negotiate, execute and enter into an operations transfer agreement (the “OTA”) with Operator, pursuant to which, inter alia, Purchaser and Operator shall make certain agreements and arrangements concerning the orderly transfer and transition of the business operations at the Property.  Purchaser hereby agrees to diligently pursue the mutual execution of the OTA, and to exercise best efforts to enter into the OTA on or before the Outside OTA Date.  Purchaser hereby acknowledges and agrees that Seller is only selling to it the Property and Purchaser shall solely rely on the provisions of the OTA with respect to the transfer of any operational assets and liabilities in connection with the operation of the business conducted at the Property.  Upon execution, Purchaser shall provide Seller with a copy of the OTA executed by Purchaser and Operator.  Notwithstanding anything herein which may be construed to the contrary, the termination of the Facility Lease shall be a condition precedent to Seller’s obligation to proceed to Closing; provided, however, Seller covenants and agrees to use commercially reasonable efforts to cause the Facility Lease to be terminated concurrently with the Closing.  If Purchaser has not entered into the OTA on or before the Outside OTA Date and provided Purchaser has otherwise complied with its obligations under this Section 5, Purchaser shall have the right to terminate this Agreement by written notice to Seller, delivered on or before the OTA Outside Date, in which case, the Deposit (and all interest thereon) shall be returned to Purchaser and neither party shall have any further rights or obligations hereunder, except those specifically survive the termination hereof.  

6.

Conveyance of Title; Closing Deliveries.

(a)

At the Closing, Seller shall convey (i) title to the real property, together with any buildings or other improvements, included in the Property (the “Real Property”) by special warranty deed in the form of Exhibit B attached hereto (with any necessary modifications to conform with local laws for recording in the land records in the jurisdiction in which the Real Property is located) (the “Deed”), subject to the Permitted Exceptions, (ii) all of Seller’s right, title and interest in and to the tangible assets and personal property included in the Property by bill of sale in the form of Exhibit C attached hereto (the “Bill of Sale”).  Seller covenants and agrees not to cause or permit any other defects in or encumbrances or limitations upon Seller’s title to the Real Property to arise from and after the Effective Date without the prior consent of Purchaser; provided, however, the foregoing shall not apply to statutory liens for real estate taxes, assessments or similar matters arising in the ordinary course and that are not then yet due and payable.

(b)

Prior to the Closing, Seller shall deliver to the Title Company in escrow:

(i)

a duly executed and acknowledged original of the Deed;

(ii)

a duly executed original of the Bill of Sale;

(iii)

a duly executed affidavit of non-foreign status; 

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(iv)

a duly executed counterpart to a closing statement prepared by the Title Company and approved by Seller and Purchaser, which shall conform to the proration and other relevant provisions of this Agreement (the “Closing Statement”); 

(v)

such documents reasonably required by the Title Company to establish the authority of Seller to enter into and close the transactions contemplated hereby, and such documents required to satisfy Seller’s obligations with respect to those title or survey matters to which Seller has agreed to take a curative action pursuant to Section 4(b); 

(vi)

a duly executed owner’s affidavit in the form of Exhibit C attached hereto; and

(vii)

any other documents required to comply with applicable federal, state or local laws, rules or regulations, including any filings or certifications required in connection with the transfer taxes payable in connection with the Closing.  

(c)

Prior to the Closing, Purchaser shall deliver to the Title Company in escrow:

(i)

immediately available funds in the amount of the Purchase Price, plus any other sums required for costs to be paid by Purchaser pursuant to the terms of this Agreement, less any credits against the Purchase Price provided for herein, including, without limitation, the Deposit; 

(ii)

a duly executed counterpart to the Closing Statement;

(iii)

such documents reasonably required by the Title Company to establish the authority of Purchaser to enter into and close the transactions contemplated hereby; and

(iv)

any documents required to comply with applicable federal, state or local laws, rules or regulations, including any filings or certifications required in connection with the transfer taxes payable in connection with the Closing.

(d)

The parties shall also deliver at the Closing any other documents reasonably requested by the other party to complete and evidence the acquisition of the Property contemplated hereby.

7.

Closing.  The closing of the acquisition of the Property (the “Closing”) shall occur on the first (1st) day of the calendar month following the later of (a) fifteen (15) days after the Due Diligence Expiration Date, and (b) the date on which Purchaser obtains the Required Authorizations (as defined below), and shall be consummated through the mutual exchange of documents and funds through the escrow established with the Title Company.  Purchaser hereby covenants and agrees to use its best efforts to secure the Required Authorizations by the date (the “Outside Authorization Date”) required (pursuant to the preceding sentence) for the Closing to occur on the first (1st) day of the calendar month following one hundred eighty (180) days from the Effective Date, including, without limitation, by submitting its initial application for the Required Authorizations (the “Required Authorization Application”) with the applicable governmental authority within five (5) days of the Effective Date.   Purchaser shall continuously use its best efforts and due diligence to obtain the Required Authorizations prior to the Outside Authorization Date and shall promptly respond to any questions or information requests from any governmental authority responsible for or otherwise involved in the review of the Required Authorization Application.  Upon Seller’s request, Purchaser shall furnish to Seller a copy of the Required Authorization Application and any correspondence or other written documentation received from or delivered to any governmental authority responsible for or otherwise involved in the review of Required Authorization Application.  Purchaser shall keep Seller fully advised at all times as 

51666.5

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to the status of Purchaser’s efforts to obtain the Required Authorizations and of any material developments in connection therewith, including notifying Purchaser promptly following receipt of notice of the issuance of or rejection of the application for, the Required Authorizations.  The foregoing obligations of Purchaser with respect to the Required Authorizations are collectively referred to herein as the “Licensing Obligations.”  If (i) Purchaser does not obtain the Required Authorizations on or before the Outside Authorization Date or (ii) Purchaser’s Required Authorization Application is rejected by the applicable governmental authority, either party may terminate this Agreement by written notice to the other party at any time thereafter (the “Licensing Termination Notice”).  If this Agreement is terminated due to the delivery of the Licensing Termination Notice, neither party shall have any further liabilities or obligations hereunder, except for those liabilities and obligations that expressly survive a termination of this Agreement, and, provided Purchaser has fully and timely satisfied the Licensing Obligations, the Deposit and all interest thereon shall be returned to Purchaser.  The term “Required Authorizations” shall mean such consents, approvals and other assurances, oral or written, as are, under local custom and practice, customarily obtained from State licensing authorities by reasonable operators of facilities like the Facility, acting in good faith, before such an operator takes possession of, and begins to operate, a facility like the Facility.  By way of example and without limitation of the foregoing, in the event that Purchaser receives permission from the applicable State licensing authorities to assume operational control of the Facility prior to the issuance of a non-provisional or non-conditional license for the Facility (e.g., due to a State licensing authority’s requirement that a survey of Purchaser’s operations at the Facility be completed prior to the issuance of a non-provisional or non-conditional license) and, under local custom and practice, reasonable operators of facilities like the Facility customarily take possession of, and begin to operate, facilities like the Facility on the basis of such permission, then, for purposes of this Section 7, the date of such permission would be treated as the date that Purchaser obtained the Required Authorizations.

8.

Allocation of Costs and Expenses.  

(a)

Seller shall pay (i) any deed or transfer taxes applicable to the Deed, (ii) fifty percent (50%) of all escrow fees, charges and expenses of the Title Company and the fees for recording the Deed, and (iii) the fees and expenses of Seller’s attorneys, accountants and professional advisors.

(b)

Purchaser shall pay (i) the premium for Purchaser’s title policy and any endorsements thereto, (ii) fifty percent (50%) of all escrow fees, charges and expenses of the Title Company and the fees for recording the Deed, and (iii) the fees and expenses of Purchaser’s attorneys, accountants and professional advisors. 

(c)

Any other costs of the Title Company or of closing pertaining to this transaction not otherwise expressly allocated among Purchaser and Seller under this Agreement shall be apportioned in the manner customary in Tulsa County, Oklahoma.

9.

Prorations.  

(a)

Except as provided in Section Error! Referenc below, all revenues and costs associated with owning or operating the Property shall be prorated between Purchaser and Operator under the terms of the OTA.  

(b)

Real estate taxes and assessments shall be prorated between Purchaser and Seller for the calendar year in which such taxes and assessments are assessed, on the basis of the number of days in such period the Property will have been owned by Seller and Purchaser, respectively.  If the current tax bill is not available at Closing, then the proration shall be made on the basis of the most recent ascertainable tax bill, with Seller and Purchaser to readjust the proration for taxes, if necessary, once the actual tax bill or bills for the year in which Closing occurs are received.  Seller shall be deemed to be the owner of the Property on the day 

51666.5

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preceding the date on which the Closing occurs, and Purchaser shall be deemed to be the owner of the Property on the date on which the Closing occurs.

10.

Broker.  At the Closing, Seller shall pay a commission to Marcus & Millichap (“Seller’s Broker”) or its designee in connection with this transaction under a separate agreement between them.  Except for any commission that may be payable to Seller’s Broker as set forth above, Seller and Purchaser hereby represent to the other that neither has discussed this Agreement or the subject matter thereof with any broker or salesman so as to create any legal right in any such broker or salesman to claim a commission or similar fee with respect to the purchase or sale of the Property contemplated by this Agreement.  Purchaser and Seller hereby indemnify each other against and agree to defend and hold harmless the other from any and all claims for any commission or similar fees arising out of or in any way connected with any claimed agency relationship with the indemnitor and relating to the purchase and sale of the Property contemplated by this Agreement.  The representations and indemnity obligations in this Section 10 shall survive the Closing.  

11.

Risk of Condemnation Pending the Closing.  If, prior to the Closing, any material part of the Facility is taken by eminent domain (or becomes the subject of a pending taking which has not yet been consummated), Seller shall notify Purchaser of such fact promptly after obtaining knowledge thereof and Purchaser shall have the right to terminate this Agreement (in whole but not in part) by giving notice thereof to Seller not later than ten (10) days after the giving of Seller’s notice (and, if necessary, the Closing shall be extended until the first (1st) day of a calendar month after the expiration of such ten (10)-day period).  If Purchaser elects to terminate this Agreement as aforesaid, the Deposit (together with all accrued interest) shall be returned to Purchaser, whereupon, this Agreement shall terminate and be of no further force or effect and no party shall have any rights or obligations hereunder, except those that specifically survive the termination hereof.  If less than a material part of the Facility shall be affected or if Purchaser shall not elect to terminate this Agreement as aforesaid, the sale of the Property shall be consummated as herein provided without any adjustment to the Purchase Price (except to the extent of any condemnation award received by Seller prior to the Closing) and Seller shall assign to Purchaser at the Closing all of Seller’s right, title and interest in and to all awards with respect to the Property,  if any, for the taking, and Purchaser shall be entitled to receive and keep all awards for the taking of the Facility or portion thereof.  As used herein, the term “any material part of the Facility is taken by eminent domain (or becomes the subject of a pending taking which has not yet been consummated)” shall mean any taking that would:  (a) materially and adversely affect Purchaser’s ability after said taking to operate the Facility in compliance with the licenses applicable to the Facility with the same number of licensed beds at the Facility as are existing as of the Effective Date, (b) eliminate, after said taking, the primary means of egress and ingress to and from the Property to a public highway, or (c) result in the taking of in excess of ten percent (10%) of the square footage of the Facility or twenty percent (20%) of the Real Property.

12.

Risk of Casualty Pending the Closing.  If, prior to the Closing, all or any material part of the Facility is destroyed or materially damaged by fire or other casualty, Seller shall promptly notify Purchaser of such fact.  In such event, Purchaser shall have the right to terminate this Agreement (in whole but not in part) by giving notice thereof to Seller not later than ten (10) days after receiving Seller’s notice (and, if necessary, the Closing shall be extended until the first (1st) day of a calendar month after the expiration of such ten (10)-day period).  If Purchaser elects to terminate this Agreement as aforesaid, the Deposit (together with all accrued interest) shall be returned to Purchaser, whereupon, this Agreement shall terminate and be of no further force or effect and no party shall have any rights or obligations hereunder, except those that specifically survive the termination hereof.  If less than a material part of the Facility shall be affected or if Purchaser shall not elect to terminate this Agreement as aforesaid, there shall be no abatement of the Purchase Price and Seller shall assign to Purchaser at the Closing all of Seller’s right, title and interest in and to the proceeds, if any, under Seller’s insurance policies covering the Facility with respect to such damage or destruction and there shall be credited against the Purchase Price the amount of any applicable deductible not then paid by Seller.  

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As used herein, the term “all or any material part of the Facility is destroyed or materially damaged by fire or other casualty” shall mean that the cost to repair the Facility following such destruction or damage is reasonably estimated by Seller’s insurance consultant to exceed $1,000,000.  

13.

Notice.

(a)

Any notice, election or other communication required or permitted hereunder shall be delivered by hand (or nationally-recognized courier service) to the following named persons or by certified United States mail, return receipt requested, postage and charges prepaid, to the following addresses:

to Purchaser:

Southern Tulsa, LLC

Two Buckhead Plaza

3050 Peachtree Road NW, Suite 355

Atlanta, Georgia  30305

Attention:  Christopher F. Brogdon

with a copy to:

Holt Ney Zatcoff & Wasserman, LLP

100 Galleria Pkwy, Suite 1800

Atlanta, Georgia  30339

Attention:  Gregory P. Youra, Esq.

to Seller:

c/o Ventas, Inc.

2050 Main Street, Suite 800

Irvine, California  92614

Attention:  Humair Sabir

with a copy to:

c/o Ventas, Inc.

353 N. Clark Street, Suite 3300

Chicago, Illinois  60654

Attention:  Legal Department, Asset Management Counsel

with a copy to:

Sherry Meyerhoff Hanson & Crance LLP

610 Newport Center Drive, Suite 1200

Newport Beach, California  92660

Attention:  Kyle B. Bennion, Esq.

(b)

Any notice, election or other communication delivered or mailed as aforesaid shall be effective upon delivery.  

(c)

Each party hereto may change its address and addressee for notice, elections and other communications from time to time by notifying the other parties hereto of the new address and addressee in the manner provided for giving notice herein.

14.

Representations and Warranties.  

(a)

As an inducement to Purchaser to enter into this Agreement, Seller represents and warrants as follows (all of which shall expressly survive Closing for one (1) year, but no longer):

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(i)

Seller is a limited liability company, duly organized, validly existing and in good standing under the laws of the State of Delaware and duly qualified to transact business in the State of Oklahoma. 

(ii)

This Agreement and all the documents to be executed and delivered by Seller to Purchaser or the Title Company pursuant to the terms of this Agreement (A) will have been, as of the execution date of each respective document, duly authorized, executed and delivered by Seller; (B) are or will be legal and binding obligations of Seller as of the date of their respective executions; (C) are or will be, as of the execution date of each respective document, enforceable in accordance with their respective terms (except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, moratorium and other principles relating to or limiting the rights of contracting parties generally); and (D) do not, and will not at the Closing, violate any provision of any agreement to which Seller is a party, any of Seller’s organizational documents or any existing obligation of or restriction on Seller under any order, judgment or decree of any state or federal court or governmental authority binding on Seller.

(iii)

To Seller’s knowledge, there are no pending investigations, actions or proceedings which question the validity of this Agreement or any action taken or to be taken pursuant hereto.  Within the last twelve (12) months, Seller has not received any written notice regarding any pending or threatened litigation or administrative proceedings with respect to the Property which could reasonably be expected to materially adversely affect the Facility or Seller’s right to enter into this Agreement or to consummate the transactions contemplated hereunder.  To Seller’s knowledge, Seller is not subject to any judgment, order, writ, injunction, decree or award of any court, arbitrator or governmental department, agency, board, bureau or instrumentality issued or entered in a proceeding to which Seller or the Facility is or was a party which is binding upon the Facility.  

(iv)

Within the last twelve (12) months, Seller has not received any written notice from any governmental authority claiming that the Property is in material violation of any applicable law, code, rule, regulation, ordinance, license or permit. 

(v)

To Seller's knowledge. Seller has not unlawfully used, generated, transported, treated, constructed, deposited, stored, disposed, placed or located at, on, under or from the Property any flammable explosives, radioactive materials, hazardous or toxic substances, materials or wastes, pollutants or contaminants defined, listed or regulated by any applicable local, state or federal environmental laws in material violation of any such environmental laws where such violation could reasonably be expected to have an material adverse effect on the Facility 

As used in this Agreement, the term “to Seller’s knowledge” or any similar phrase, shall mean the actual, current knowledge, without any duty of investigation, of Humair Sabir, in his capacity as an employee of Seller’s ultimate parent company.  

(b)

As an inducement to Seller to enter into this Agreement, Purchaser represents and warrants as follows (all of which shall expressly survive Closing for one (1) year, but no longer):  

(i)

Purchaser is a limited liability company, duly organized, validly existing and in good standing under the laws of the State of Georgia.

51666.5

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(ii)

This Agreement and all the documents to be executed and delivered by Purchaser to Seller or the Title Company pursuant to the terms of this Agreement (A) will have been, as of the execution date of each respective document, duly authorized, executed and delivered by Purchaser; (B) are or will be legal and binding obligations of Purchaser as of the date of their respective executions; (C) are or will be, as of the execution date of each respective document, enforceable in accordance with their respective terms (except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, moratorium and other principles relating to or limiting the rights of contracting parties generally); and (D) do not, and will not at the Closing, violate any provision of any agreement to which Purchaser is a party, any of Purchaser’s organizational documents or any existing obligation of or restriction on Purchaser under any order, judgment or decree of any state or federal court or governmental authority binding on Purchaser.

15.

RELEASE; AS-IS/WHERE-IS.  

(a)

PURCHASER, ON BEHALF OF ITSELF AND ITS EMPLOYEES, AGENTS, SUCCESSORS AND ASSIGNS, ATTORNEYS AND OTHER REPRESENTATIVES, AND EACH OF THEM, HEREBY RELEASES SELLER FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, CAUSES OF ACTION, OBLIGATIONS, DAMAGES AND LIABILITIES OF ANY NATURE WHATSOEVER, WHETHER ALLEGED UNDER ANY STATUTE, COMMON LAW OR OTHERWISE, DIRECTLY OR INDIRECTLY, ARISING OUT OF OR RELATED TO THE CONDITION, OPERATION OR ECONOMIC PERFORMANCE OF THE PROPERTY.  The foregoing shall not be deemed to release Seller from any covenants or obligations under this Agreement or any rights which Purchaser may have against Seller under the terms of this Agreement.  Notwithstanding the foregoing, Seller’s liability to Purchaser for a breach of this Agreement by Seller, including, without limitation, a breach of any representation or warranty by Seller hereunder, shall not exceed $100,000.00.  

(b)

Except for the representations of Seller set forth in Section 14(a) and those warranties of title to be included in the Deed, Seller is not making any representations or warranties with respect to the Property, and the Property is being sold “AS-IS, WHERE-IS WITH NO REPRESENTATIONS OR WARRANTIES EXPRESSED OR IMPLIED AND WITH ALL FAULTS” in accordance with the provisions of this Section 15, it being understood and agreed that the Purchase Price has been adjusted by prior negotiation to reflect that the Property is being sold by Seller and purchased by Purchaser to the foregoing.  Purchaser has or shall perform its own due diligence in determining whether to purchase the Property and Purchaser is not relying on any representations or warranties of Seller in determining whether to purchase the Property.  Except for those warranties of title to be included in the Deed, Purchaser acknowledges and agrees that Seller has not made, does not make and specifically negates and disclaims any representations, warranties, promises, covenants, agreements or guaranties of any kind or character whatsoever, whether express or implied, oral or written, past, present or future of, as to, concerning or with respect to: (a) the value of the Property; (b) the income to be derived from the Property; (c) the suitability of the Property for any and all activities and uses which Purchaser may conduct thereon, including any development of the Property; (d) the habitability, merchantability, marketability, profitability or fitness for a particular purpose of the Property; (e) the manner, quality, state of repair or lack of repair of the Property; (f) the nature, quality or condition of the Property, including, without limitation, the water, soil and geology; (g) the compliance of or by the Property or its operation with any laws, rules, ordinances or regulations of any applicable governmental authority or body; (h) the manner, condition or quality of the construction or materials incorporated into the Property; (i) compliance with any environmental protection, pollution or land use laws, rules, regulations, orders or requirements; (j) the presence or absence of hazardous materials at, on, under or adjacent to the Property; (k) the conformity of the improvements to any plans or specifications for the Property; (l) the conformity of the Property to past, current or future applicable zoning or building requirements; (m) adequacy or deficiency of 

51666.5

11

any drainage; (n) the existence of vested land use, zoning or building entitlements affecting the Property; or (o) with respect to any other matter concerning the Property, including any and all such matters referenced, discussed or disclosed in any documents delivered by Seller to Purchaser, in any public records of any governmental agency or entity or utility company.

16.

Time of Essence.  Time is of the essence as to all dates and times of performance pursuant to this Agreement.  Notwithstanding the foregoing, in the event the date for the performance of an action or the giving of a notice falls on a Saturday, Sunday or holiday, then the date for the performance of such action or giving of such notice shall be automatically extended to the next succeeding business day.

17.

Entire Agreement.  This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be amended except by written instrument executed by all the parties hereto.

18.

Headings; Defined Terms; Interpretation.  The paragraph and section headings are inserted for convenience only and are in no way intended to describe, interpret, define or limit the scope or content of this Agreement or any provision hereof.  As used herein, a “business day” shall mean a day other than Saturday, Sunday or any day on which banking institutions in Tulsa, Oklahoma, are authorized by law or other governmental action to close.  Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be valid under applicable law, but, if any provision of this Agreement shall be invalid or prohibited thereunder, such invalidity or prohibition shall be construed as if such invalid or prohibited provision had not been inserted herein and shall not affect the remainder of such provision or the remaining provisions of this Agreement.  The language in all parts of this Agreement shall be in all cases construed simply according to its fair meaning and not strictly against the party that drafted such language.  

19.

Applicable Law.  This Agreement shall be construed and interpreted in accordance with the laws of the State of Oklahoma.

20.

Attorneys’ Fees.  If either party commences an action against the other to interpret or enforce any of the terms of this Agreement or because of the breach by the other party of any of the terms hereof, the losing party shall pay to the prevailing party reasonable attorneys’ fees, costs and expenses incurred in connection with the prosecution or defense of such action, whether or not the action is prosecuted to a final judgment.  

21.

Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of Seller and Purchaser, and their respective successors and assigns, if any.  It is specifically agreed that Purchaser may nominate another party to take title to the Property at Closing, but no such nomination shall relieve Purchaser of any liability hereunder.

22.

1031 Exchange.  Purchaser or Seller may consummate the purchase or sale of the Property as part of a so-called like kind exchange (the “Exchange”) pursuant to Section 1031 of the Internal Revenue Code of 1986, as amended (the “Code”), provided that:  (a) the Closing shall not be delayed or affected by reason of the Exchange nor shall the consummation or accomplishment of the Exchange be a condition precedent or condition subsequent to Purchaser’s or Seller’s obligations under this Agreement; (b) Seller shall not be required to take an assignment of the purchase agreement for the relinquished property or be required to acquire or hold title to any real property for purposes of consummating the Exchange; (c) a party performing an Exchange shall pay any additional costs that would not otherwise have been incurred had such party not consummated an Exchange; (d) neither party’s acquiescence to an Exchange shall affect or diminish in any manner its rights hereunder nor shall the party not performing an Exchange be responsible for compliance with or be deemed to have warranted to the other party that the Exchange in fact complies with Section 1031 of the 

51666.5

12

Code; and (e) any party performing an Exchange shall indemnify, defend, and hold harmless the other party from or against all claims, losses, costs, damages, liabilities (including reasonable attorneys’ fees) in connection therewith.

23.

Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which, when taken together, shall constitute one and the same instrument.

24.

Confidentiality.  Purchaser agrees that, (a) except as otherwise required by valid law and (b) except to the extent reasonably necessary to deliver such documents or information to Purchaser’s employees, agents, attorneys and/or consultants in connection with Purchaser’s evaluation of this transaction, Purchaser shall use all diligent efforts to keep the contents of any materials, reports, documents, data, test results, and other information related to the transaction contemplated hereby, including the Due Diligence Materials and all information regarding Purchaser’s acquisition of the Property strictly confidential.  The provisions of this Section 24 shall survive any termination of this Agreement but shall not survive the Closing. 

25.

Submission Not An Offer.  Submission of this Agreement to Purchaser does not constitute an option or offer to sell the property and this Agreement shall not be effective unless and until execution and delivery occurs by both Purchaser and Seller.

[Signature Page Follows]

51666.5

13

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

PURCHASER: 

SOUTHERN TULSA, LLC,

a Georgia limited liability company

By:  

/s/ Christopher E. Brogdon

Name:  Christopher E. Brogdon

Title:  Manager

[Signatures continue on next page]

51666.SIG

S-1

SELLER:

NATIONWIDE HEALTH PROPERTIES, LLC,

a Delaware limited liability company

By:  

/s/Joseph D. Lambert 

Name:  

Title: Vice President

51666.SIG

S-2

CONSENT OF ESCROW

The undersigned agrees to (a) accept this Agreement; (b) be escrow holder under this Agreement; and (c) be bound by this Agreement in the performance of its duties as the Title Company and escrow holder.  However, the undersigned will have no obligations, liability or responsibility under this Agreement or any amendment hereto unless and until this Agreement and such amendment, as applicable has been fully executed by the parties hereto and delivered to the undersigned.  

TITLE COMPANY:

FIDELITY NATIONAL TITLE INSURANCE COMPANY

By:  

Name:  

Title:  

Fidelity National Title Insurance Company

National Title Services Division

2828 Routh Street, Suite 800

Dallas, Texas 75201

Attn:  Stephany Roppolo

Dated:  _________________, 2013

Escrow No. ____________________

51666.SIG

S-3

EXHIBIT A

Legal Description

That certain real property located in the City of Tulsa, County of Tulsa, State of Oklahoma and more particularly described as follows:

LOT ONE (1), BLOCK ONE (1), URBANA HEIGHTS TWO, AN ADDITION TO THE CITY OF TULSA, TULSA COUNTY, STATE OF OKLAHOMA, ACCORDING TO THE RECORDED PLAT THEREOF.  

51666.5

Exhibit A

EXHIBIT B

Form of Deed

SPECIAL WARRANTY DEED

STATE OF OKLAHOMA

)

)

KNOW ALL PERSONS BY THESE PRESENTS:

COUNTY OF TULSA

)

THAT NATIONWIDE HEALTH PROPERTIES, LLC, a Delaware limited liability company (“Grantor”), in consideration of the sum of TEN AND NO/100 (10.00) DOLLARS and other good and valuable consideration to Grantor, cash in hand paid by SOUTHERN TULSA, LLC, a Georgia limited liability company (“Grantee”), the receipt and sufficiency of which are hereby acknowledged and confessed, has GRANTED, BARGAINED, SOLD and CONVEYED, and by these presents does hereby GRANT, BARGAIN, SELL and CONVEY unto Grantee, all of (i) the real property (the “Land”) located in Tulsa County, Oklahoma, and more particularly described in Exhibit “A” attached hereto and made a part hereof for all purposes; together with (ii) all and singular, the benefits, privileges, easements, tenements, hereditaments and appurtenances thereon or in anywise appertaining thereto, and any and all right, title and interest of Grantor in and to adjacent roads and rights-of-way (the “Rights and Appurtenances”); and together with (iii) all buildings, fixtures, and improvements located on the Land (the “Improvements”) (the Land, Improvements and Rights and Appurtenances are collectively referred to herein as the “Property”); subject to, however, of all rights, encumbrances, takings, rights-of-way, easements, agreements, conditions, restrictions, reservations and other matters of record, insofar as the same are now in force and applicable, to any lien for real estate taxes assessed and not yet due and payable, which the Grantee by acceptance hereof hereby assumes and agrees to pay, and to any matters disclosed on a survey delivered to Grantee.

TO HAVE AND TO HOLD the Property, together with all and singular any other rights and appurtenances thereto in anywise belonging unto Grantee, its successors and assigns, FOREVER; and it is agreed that Grantor does hereby bind itself and its successors and assigns to WARRANT AND FOREVER DEFEND all and singular, the Property, subject as aforesaid, unto Grantee and its successors and assigns, against every person whomsoever lawfully claiming or to claim the same or any part thereof, by, through, or under Grantor, but not otherwise.

Grantee acknowledges and agrees and that Grantor has not made, does not make and specifically negates and disclaims any representation, warranties, other than those expressly contained herein, promises, agreements or guaranties of any kind or character whatsoever, whether express or implied, oral or written concerning or with respect to: (i) the value, quality or condition of the Property; (ii) the suitability of the Property for any and all activities and uses which Grantee may conduct thereon; (iii) the compliance of the Property with any applicable laws or restrictive covenants; (iv) the habitability, suitability, merchantability, marketability or fitness for particular purpose of the Property; (v) the manner or quality of the construction or materials incorporated into the Property; (vi) the manner, quality, state of repair or lack of repair of the Property; or (vii) any other matter of any kind with respect to the Property.  Grantee further acknowledges and agrees that to the maximum extent permitted by law, the sale of the Property as provided for herein is made on an “as is” and “with all faults” condition and basis with all faults and defects.

The address of Grantee is Two Buckhead Plaza, 3050 Peachtree Road NW, Suite 355, Atlanta, Georgia 30305.

51666.5

Exhibit B-1

IN WITNESS WHEREOF, Grantor has executed this Special Warranty Deed as of the ______ day of _______, 2013.

GRANTOR:

NATIONWIDE HEALTH PROPERTIES, LLC,

a Delaware limited liability company

By:  

Name:  

Title:  

STATE OF ILLINOIS

)

) ss.

COUNTY OF COOK

)

I certify that I know or have satisfactory evidence that the person appearing before me and making this acknowledgment is the person whose true signature appears on this document.

On this _____ day of _____________________, 2013, before me personally appeared ______________________, to me known to be the ______________________ of Nationwide Health Properties, LLC, the limited liability company that executed the within and foregoing instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said limited liability company, for the uses and purposes therein mentioned, and on oath stated that he/she was authorized to execute said instrument.

WITNESS my hand and official seal hereto affixed the date and year first above written.

Notary Public in and for the State of 

Residing at 

My commission expires:

Type or Print Notary Name

AFTER RECORDATION, PLEASE RETURN TO:

Gregory P. Youra, Esq.

Holt Ney Zatcoff & Wasserman, LLP

100 Galleria Pkwy, Suite 1800

Atlanta, Georgia 30339

51666.5

Exhibit B-2

EXHIBIT C

Form of Bill of Sale

BILL OF SALE

Pursuant to that certain Purchase and Sale Agreement dated as of _______________, 2013 (the “Purchase Agreement”), by and between NATIONWIDE HEALTH PROPERTIES, LLC, a Delaware limited liability company (“Seller”), and SOUTHERN TULSA, LLC, a Georgia limited liability company (“Purchaser”), and in consideration of Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller does hereby grant, bargain, sell, convey, assign and transfer to Purchaser, all of Seller’s right, title and interest, if any, in and to, all personal property which is located on that certain real property described on Exhibit A attached hereto (the “Personal Property”) and owned by Seller.  

TO HAVE AND TO HOLD, all and singular, the Personal Property hereby sold, assigned, transferred and conveyed to Purchaser, its successors and assigns, to and for its own use and benefit.  PURCHASER HEREBY ACKNOWLEDGES AND AGREES THAT ANY AND ALL PERSONAL PROPERTY BEING TRANSFERRED HEREUNDER ARE ON AN AS-IS, WHERE-IS BASIS WITH ALL FAULTS AND CONDITIONS.  SELLER MAKES NO EXPRESS OR IMPLIED WARRANTIES OR REPRESENTATIONS OF ANY KIND OR NATURE WHATSOEVER, INCLUDING ANY REPRESENTATIONS OR WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PURPOSE.

Dated as of this _____ day of _____________, 2013.

SELLER:

NATIONWIDE HEALTH PROPERTIES, LLC,

a Delaware limited liability company

By:  

Name:  

Title:  

51666.5

Exhibit D-1

EXHIBIT D

Form of Owner’s Affidavit

SELLER’S DECLARATION

TITLE COMPANY:   FIDELITY NATIONAL TITLE INSURANCE COMPANY

ORDER NO.:  ______________

SELLER:  NATIONWIDE HEALTH PROPERTIES, LLC, a Delaware limited liability company

PURCHASER:   SOUTHERN TULSA, LLC, a Georgia limited liability company

PROPERTY DESCRIPTION (the “Property”):  See Exhibit A attached hereto

The undersigned, on behalf of Seller, declares that, to the undersigned’s actual and current knowledge, the following information is true and correct:

1.

Purpose of Declaration.  This declaration is made to the Title Company as an inducement to it to complete a transaction concerning the Property.  Seller acknowledges that Title Company is relying upon the representations in this declaration as being true and correct and that the transaction contemplated would not be consummated without this declaration being executed.  

2.

Debts and Liens.  Except as indicated below, there are no loans, tax liens, abstract of judgment liens or other real estate liens affecting the Property that are not of public record.  

Exceptions:  _____________________________________

3.

Real Property and Personal Property Taxes.  All real property taxes assessed against the Property which are due and payable have been paid in full, except as shown on the public records.  

4.

Improvement debts and liens.  During the six (6) months immediately preceding the date of this declaration, Seller has not contracted with any person to whom a debt is due for labor or materials furnished in the erection, alteration, repair or removal of a building or structure upon the Property, or to the improvement of or alteration to the Property, in procuring or furnishing such labor or materials for work performed during the past six (6) months.

5.

Other Contracts.  Other than the agreement to sell the Property to Purchaser (which agreement is set forth in that certain Purchase and Sale Agreement dated as of _____________, 201__, by and between Seller and Purchaser, there are no other unreleased contracts of sale concerning the Property.

[Signature page follows]

51666.5

Exhibit D-2

EXECUTED this __ day of ___________, 2013.

NATIONWIDE HEALTH PROPERTIES, LLC,

a Delaware limited liability company

By:  

Name:  

Title:  

51666.5

Exhibit D-3

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