Common use of Term Debt Clause in Contracts

Term Debt. Unsecured Short-Term Debt, with the exception of lines of credit, may be incurred without prior written approval of HUD if the Borrower can demonstrate, and the chief financial officer or the chief executive officer of Borrower certifies to HUD in writing prior to incurring the additional indebtedness, that: Total Short-Term Debt for the current fiscal year will not exceed five percent (5%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements; The combined debt service payments for all Long-Term Debt and Short-Term Debt in the current fiscal year is not projected to exceed 10 percent (10%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements; No condition of default exists under this Agreement or under any other agreement entered in connection with any Short-Term Debt or Long-Term Debt. Line of Credit Long-Term or Short-Term Debt in the form of a line of credit (“LOC”) is only permitted with prior written approval of HUD pursuant to the following: The LOC may not have a limit exceeding fifteen (15) days of Adjusted Operating Expenses, as reflected on the Most Recent Audited Financial Statements; The LOC may be secured by Patient Accounts Receivable, subject to consent by the Lender and HUD. The total amount of the Patient Accounts Receivable used to secure the - LOC cannot be greater than 150 percent (150%) of the LOC. Total Short-Term Debt for the current fiscal year will not exceed five percent (5%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements; The combined debt service payments for all Long-Term Debt and Short-Term Debt in the current fiscal year is not projected to exceed 10 percent (10%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements;

Term Debt. Unsecured Short-Term Debt, with the exception of lines of credit, may be incurred without prior written approval of HUD if the Borrower can demonstrate, and the chief financial officer or the chief executive officer of Borrower certifies to HUD in writing prior to incurring the additional indebtedness, thatif: Total Borrower’s total Short-Term Debt for the current fiscal year will not exceed five percent (5%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements; The combined debt service payments for all of Borrower’s Long-Term Debt and Short-Term Debt in the current fiscal year is not projected to exceed 10 percent (10%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements; No condition of default exists under this Agreement or under any other agreement entered in connection with any Short-Term Debt or Long-Term Debt. Line Lines of Credit Long-Term or Short-Term Debt in the form of a line of credit (“LOC”) is only permitted with prior written approval of HUD pursuant to the following: The LOC may not have a limit exceeding fifteen (15) days of Adjusted Operating Expenses, as reflected on the Most Recent Audited Financial Statementsmost recent audited financial statements; The LOC may only be secured by: Assets that are not pledged as collateral for the Borrower’s Security Instrument, subject to consent by HUD, By Patient Accounts Receivable, subject to consent by the Lender and HUD. The total amount of the Patient Accounts Receivable used to secure the - LOC cannot be greater than 150 percent (150%) of the LOC. For all Debt that is secured by ▇▇▇▇▇▇▇▇’s Patient Accounts Receivable, Borrower must obtain an Intercreditor Agreement (HUD 92322-OHF), approved by HUD, executed by ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and the Debt lender, prior to or contemporaneous with the incurrence of the Debt. Total Short-Term Debt for the current fiscal year will not exceed five percent (5%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements; The combined debt service payments for all Long-Term Debt and Short-Term Debt in the current fiscal year is not projected to exceed 10 percent (10%) of the average Adjusted Operating Revenue for the three (3) most recent fiscal years based on audited financial statements;