THIS LEASE IS NOT TO BE RECORDED]

Exhibit 10.2

[THIS LEASE IS NOT TO BE RECORDED]

AMENDED AND RESTATED MASTER LEASE
AND SECURITY AGREEMENT

between

HCP AUR1 California A Pack, LLC, HCP EMOH, LLC, HCP Xxxxx Creek, LLC, HCP MA2 California, LP, HCP MA2 Massachusetts, LP, HCP MA2 Ohio, LP, HCP MA2 Oklahoma, LP, HCP MA3 California, LP, HCP MA3 South Carolina, LP, HCP MA3 Washington LP, HCP Partners, LP, HCP Senior Housing Properties Trust, HCP SH Eldorado Heights LLC, HCP SH ELP1Properties, LLC, HCP SH ELP2 Properties, LLC, HCP SH ELP3 Properties, LLC, HCP XX Xxxxxx House, LLC, HCP SH Mountain Laurel, LLC, HCP SH Mountain View, LLC, HCP SH River Valley Landing, LLC, HCP XX Xxxxxxxx Landing, LLC, HCP ST1 Colorado, LP, HCP,Inc. and HCPI Trust,
as their interests may appear, as Lessor

and

Emeritus Corporation, Summerville at Xxxxx Creek, LLC and Summerville at Prince Xxxxxxx,Inc.,
collectively, and jointly and severally, as Lessee

Dated as of August 29, 2014

TABLE OF CONTENTS


		Page
Article I.		1
1.1	Leased Property; Term	1
Article II.		1
2.1	Definitions	1
Article III.		13
3.1	Rent	13
3.2	Additional Charges	15
3.3	Late Payment of Rent	16
3.4	Net Lease	16
3.5	Personal Property	16
Article IV.		17
4.1	Impositions	17
4.2	Utility Charges	17
4.3	Insurance Premiums	17
4.4	Impound Accounts	17
4.5	Tax Service	18
Article V.		18
5.1	No Termination, Abatement, etc.	18
5.2	Termination with Respect to Fewer than All of the Facilities	18
Article VI.		19
6.1	Ownership of the Leased Property	19
6.2	Personal Property	19
6.3	Transfer of Personal Property and Capital Additions to Lessor	19
Article VII.		19
7.1	Condition of the Leased Property	19
7.2	Use of the Leased Property	19
7.3	Lessor to Grant Easements, Etc.	20
7.4	Preservation of Facility Value	20
Article VIII.		23
8.1	Compliance with Legal and Insurance Requirements, Instruments, Etc.	23
Article IX.		23
9.1	Maintenance and Repair	23
9.2	Encroachments, Restrictions, Mineral Leases, Etc	23
9.3	Intentionally Omitted	24
9.4	O&M Plan	24


9.5	Capital Projects Funded by Lessee	24
9.6	Intentionally Omitted	25
9.7	Inspections; Due Diligence Fee	25
9.8	Capital Projects Funded by Lessor	25
Article X.		27
10.1	Construction of Alterations	27
10.2	Construction Requirements for all Alterations	27
Article XI.		30
11.1	Liens	30
Article XII.		30
12.1	Permitted Contests	30
Article XIII.		30
13.1	General Insurance Requirements	30
13.2	Waiver of Subrogation	32
13.3	General Provisions	32
13.4	Increase in Limits	32
13.5	Blanket Policies	32
Article XIV.		32
14.1	Insurance Proceeds	32
14.2	Insured Casualty	33
14.3	Uninsured Casualty	33
14.4	No Abatement of Rent	34
14.5	Waiver	34
Article XV.		34
15.1	Condemnation	34
Article XVI.		34
16.1	Events of Default	34
16.2	Certain Remedies	36
16.3	Damages	36
16.4	Receiver	37
16.5	Lessee’s Obligation to Purchase	37
16.6	Waiver	37
16.7	Application of Funds	37
16.8	Grant of Security Interest; Appointment of Collateral Agent	37
16.9	Leases and Residential Care Agreements	39
Article XVII.		39
17.1	Lessor’s Right to Cure Lessee’s Default	39


Article XVIII.		39
18.1	Purchase of the Leased Property	39
18.2	Rights of Lessee Prior to Closing	39
18.3	Lessor’s Election of 1031 Exchange; Lessee’s Regulatory Filings	40
Article XIX.		40
19.1	Extended Terms	40
Article XX.		40
20.1	Holding Over	40
Article XXI.		41
21.1	General REIT Provisions	41
21.2	REIT Agreements	41
Article XXII.		41
22.1	Risk of Loss	41
Article XXIII.		41
23.1	General Indemnification	41
Article XXIV.		42
24.1	Transfers	42
Article XXV.		46
25.1	Officer’s Certificates and Financial Statements	46
Article XXVI.		48
26.1	Lessor’s Right to Inspect and Show the Leased Property and Capital Additions	48
Article XXVII.		48
27.1	No Waiver	48
Article XXVIII.		48
28.1	Remedies Cumulative	48
Article XXIX.		48
29.1	Acceptance of Surrender	48
Article XXX.		48
30.1	No Merger	48
Article XXXI.		48
31.1	Conveyance by Lessor	48
31.2	New Lease	48
31.3	New Master Lease	49

iii


31.4	Purchase Option	49
Article XXXII.		50
32.1	Quiet Enjoyment	50
Article XXXIII.		50
33.1	Notices	50
Article XXXIV.		51
34.1	Appraiser	51
Article XXXV.		52
35.1	Intentionally Omitted.	52
Article XXXVI.		52
36.1	Lessor May Grant Liens	52
36.2	Attornment	52
36.3	Compliance with Facility Mortgage Documents; Superior Leases	52
36.4	Superior Leases	53
Article XXXVII.		53
37.1	Hazardous Substances and Mold	53
37.2	Notices	54
37.3	Remediation	54
37.4	Indemnity	54
37.5	Inspection	55
Article XXXVIII.		55
38.1	Memorandum of Lease	55
Article XXXIX.		56
39.1	Sale of Assets	56
Article XL.		56
40.1	Additional Representations and Warranties by Lessor	56
Article XLI.		57
41.1	Additional Representations and Warranties by Lessee	57
Article XLII.		57
42.1	Attorneys’ Fees	57
Article XLIII.		57
43.1	Brokers	57
Article XLIV.		57
44.1	Delayed Commencement Facilities	57

Article XLV.		58
45.1	Miscellaneous	58
Article XLVI.		64
46.1	Provisions Relating to Master Lease	64
46.2	Treatment of Lease	64
46.3	Tax Characterization	64
Article XLVII.		65
47.1	California State Law Provisions	65
47.2	Connecticut State Law Provisions	65
47.3	Colorado State Law Provisions	65
47.4	Florida State Law Provisions	65
47.5	Georgia State Law Provisions	66
47.6	Waiver of Kentucky Holdover Law	66
47.7	Massachusetts State Law Provisions	66
47.8	Minnesota State Law Provisions	66
47.9	Mississippi State Law Provision	67
47.10	Montana State Law Mold Disclosure	67
47.11	Nevada State Law Provisions	67
47.12	New Jersey State Law Provisions	68
47.13	New Mexico State Law Provisions	68
47.14	North Dakota State Law Provisions	69
47.15	Oregon State Law Provisions	70
47.16	Pennsylvania State Law Provisions	70
47.17	Texas State Law Provisions	70
47.18	Virginia State Law Provisions	70
47.19	Washington State Law Provisions	70
47.20	Wisconsin State Law Provisions	71
47.21	Local Law Provisions	71

Exhibit A-1 List of Pool 1 Facilities, Facility Description and Primary Intended Use, Fixed and Extended Terms, and Initial Annual Allocated Minimum Rent and Allocated Initial Investment

Exhibit A-2 List of Pool 2 Facilities, Facility Description and Primary Intended Use, Fixed and Extended Terms, and Initial Annual Allocated Minimum Rent and Allocated Initial Investment

Exhibit A-3 List of Pool 3 Facilities, Facility Description and Primary Intended Use, Fixed and Extended Terms, and Initial Annual Allocated Minimum Rent and Allocated Initial Investment

Exhibit B Lessor’s Personal Property

Exhibit C Form of Memorandum of Lease

Schedule 1 State-Specific Impositions

Schedule 3.1.4(a) CCRC Properties

Schedule 7.4.1 List of Competing Communities

Schedule 10.1 Pre-Existing Alteration Projects

Schedule 31.4 Purchase Option Properties

Schedule 36.4 Superior Leases

AMENDED AND RESTATED MASTER LEASE AND SECURITY AGREEMENT

THIS AMENDED AND RESTATED MASTER LEASE AND SECURITY AGREEMENT (as amended, restated, replaced, supplemented or otherwise modified from time to time, this “Lease”) is dated as of August 29, 2014, and is made by and between HCP AUR1 California A Pack, LLC, a Delaware limited liability company, HCP EMOH, LLC, a Delaware limited liability company, HCP Xxxxx Creek, LLC, a Delaware limited liability company, HCP MA2 California, LP, a Delaware limited partnership, HCP MA2 Massachusetts, LP, a Delaware limited partnership, HCP MA2 Ohio, LP, a Delaware limited partnership, HCP MA2 Oklahoma, LP, a Delaware limited partnership, HCP MA3 California, LP, a Delaware limited partnership, HCP MA3 South Carolina, LP, a Delaware limited partnership, HCP MA3 Washington LP, a Delaware limited partnership, HCP Partners, LP, a Delaware limited partnership, HCP Senior Housing Properties Trust, a Delaware statutory trust, HCP SH Eldorado Heights LLC, a Delaware limited liability company, HCP SH ELP1 Properties, LLC, a Delaware limited liability company, HCP SH ELP2 Properties, LLC, a Delaware limited liability company, HCP SH ELP3 Properties, LLC, a Delaware limited liability company, HCP XX Xxxxxx House, LLC, a Delaware limited liability company, HCP SH Mountain Laurel, LLC, a Delaware limited liability company, HCP SH Mountain View, LLC, a Delaware limited liability company, HCP SH River Valley Landing, LLC, a Delaware limited liability company, HCP XX Xxxxxxxx Landing, LLC, a Delaware limited liability company, HCP ST1 Colorado, LP, a Delaware limited partnership, HCP,Inc., a Maryland corporation, and HCPI Trust, a Maryland real estate investment trust (as their interests may appear, “Lessor”), and Emeritus Corporation, a Washington corporation, Summerville at Xxxxx Creek, LLC, a Delaware limited liability company, and Summerville at Prince Xxxxxxx,Inc., a Delaware corporation (collectively, and jointly and severally, “Lessee”).

ARTICLE I.

1.1Leased Property; Term. Upon and subject to the terms and conditions hereinafter set forth, Lessor leases to Lessee and Lessee leases from Lessor all of Lessor’s rights, title and interests in and to the following (collectively the “Leased Property”):

(a)the tracts, pieces and parcels of property or properties more particularly described in and located at the addresses set forth in Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto and all easements, rights and appurtenances relating thereto, in each case whether Lessor now holds or hereafter acquires an interest in the same (collectively, the “Land”);

(b)all buildings, structures and other improvements of every kind now or hereafter located on the Land, including alleyways and connecting tunnels, sidewalks, utility pipes, conduits and lines (on-site and off-site to the extent Lessor has obtained any interest in the same), parking areas and roadways appurtenant to such buildings and structures and Capital Additions (as hereinafter defined) funded by Lessor (collectively, the “Improvements”);

(c)all equipment, machinery, fixtures, and other items of real and/or personal property, including all components thereof, now and hereafter located in, on or used in connection with and permanently affixed to or incorporated into the Improvements, including all

furnaces, boilers, heaters, electrical equipment, heating, plumbing, lighting, ventilating, refrigerating, incineration, air and water pollution control, waste disposal, air-cooling and air-conditioning systems, apparatus, sprinkler systems, fire and theft protection equipment, and built-in oxygen and vacuum systems, all of which, to the greatest extent permitted by law, are hereby deemed to constitute real estate, together with all replacements, modifications, alterations and additions thereto (collectively, the “Fixtures” and together with the Improvements, the “Leased Improvements”); and

(d)the machinery, equipment, furniture and other personal property described on Exhibit B attached hereto and made a part hereof, together with all replacements, modifications, alterations, and substitutions therefor (whether or not constituting an upgrade) (collectively, “Lessor’s Personal Property”).

SUBJECT, HOWEVER, to the Permitted Encumbrances (as defined herein) to have and to hold for the Term (as defined herein), unless this Lease is earlier terminated as hereinafter provided. In addition, Lessor reserves to itself, and the right to transfer, convey, lease or assign to any other Person, in whole or in part, all oil, gas, hydrocarbons, mineral and water rights in the Leased Property but without right of entry on the surface or within two hundred (200) feet thereof; provided, however, that (i) no such items shall be extracted in such manner (x) as may cause or contribute to a lessening of the support of the Land or the Leased Improvements, (y) that interferes in any material fashion with the continued use and operation during the Term of any Facility (as defined herein) for its Primary Intended Use (as defined herein), and (ii) Lessor and any Person to whom any such rights are assigned by Lessor shall deliver a commercially reasonable environmental indemnity agreement to and for the benefit of Lessee with respect to the activities of such Person on the Leased Property. Upon any change in the Minimum Rent (as defined herein) in accordance with the provisions of Section 3.1 below or otherwise pursuant to this Lease or upon the occurrence of the Delayed Commencement Date with respect to any Delayed Commencement Facility, the parties shall similarly execute an amendment to this Lease confirming such matters. Notwithstanding the foregoing, the failure of Lessor to prepare and/or Lessee and Lessor to so execute and deliver any such amendment shall not affect the determination of the rights, obligations and or benefits of Lessor or Lessee which would have been confirmed by any such amendment.

ARTICLE II.

2.1Definitions. For all purposes of this Lease, except as otherwise expressly provided or unless the context otherwise requires, (i) the terms defined in this Articlehave the meanings assigned to them in this Articleand include the plural as well as the singular; (ii) all accounting terms not otherwise defined herein have the meanings

assigned to them in accordance with GAAP as at the time applicable; (iii) all references in this Lease to designated “Articles,” “Sections” and other subdivisions are to the designated Articles, Sections and other subdivisions of this Lease; (iv) the word “including” shall have the same meaning as the phrase “including, without limitation,”; and (v) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Lease as a whole and not to any particular Article, Sectionor other subdivision:

1031 Exchange: As defined in Section 18.3.

Accommodator: As defined in Section 18.3.

ACMs: As defined in Section 9.4

Additional Charges: As defined in Section 3.2.

Affiliate: Any Person which, directly or indirectly (including through one or more intermediaries), controls or is controlled by or is under common control with any other Person, including any Subsidiary of a Person. For purposes of this definition, the definition of “Controlling Person” below, and Article XXIV below, the term “control” (including the correlative meanings of the terms “controls”, “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly (including through one or more intermediaries), of the power to direct or cause the direction of the management and policies of such Person, through the ownership or control of voting securities, partnership interests or other equity interests, by contract or otherwise. Without limiting the generality of the foregoing, when used with respect to any corporation, the term “Affiliate” shall also include (i) any Person which owns, directly or indirectly (including through one or more intermediaries), fifty percent (50%) or more of any class of voting security or equity interests of such corporation, (ii) any Subsidiary of such corporation and (iii) any Subsidiary of a Person described in clause (i).

Allocated Initial Investment: With respect to each Facility, at any given time, the applicable amount set forth under the heading “Allocated Initial Investment” on Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto, as applicable.

Allocated Minimum Rent: With respect to each Facility, the amount of rent allocated to such Facility as determined by Section 3.1.1 and Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto; provided, however, that Lessor and Lessee acknowledge and agree that such allocation is solely for purposes of implementing the provisions of Sections 3.1.4, 5.2, 15.1.2, 16.5 and 31.2.1 hereof and the determination of Transfer Consideration. Except for such Sections, the Minimum Rent and other Rent payable hereunder is payable for all the Facilities as a single, indivisible, integrated and unitary economic unit and that but for such integration, the Minimum Rent and other Rent payable under this Lease would have been computed on a different basis.

Alteration: Any alteration, or addition or improvement of or to any portion of the Leased Property, including any Capital Addition or Capital Project.

Annual Minimum Capital Project Amount: With respect to any Lease Year, an amount for all of the Facilities in the aggregate such that the per-unit average is equal to (i) in the case of the first Lease Year, [***], (ii) in the case of each of the second, third and fourth Lease Years, [***], and (iii) in the case of the fifth Lease Year and each Lease Year thereafter, [***], with such amount increasing upon the expiration of each such Lease Year (commencing with the fifth Lease Year) by a percentage equal to the CPI Increase and (if the final Lease Year is not a

Portions of this exhibit that have been marked by [***] have been omitted pursuant to a request for confidential treatment filed separately with the Securities and Exchange Commission.

full calendar year) with the amount for the final Lease Year being prorated based on the number of days in such final Lease Year. For purposes of clarity, in no event shall the Annual Minimum Capital Project Amount (on a per-unit basis) for any Lease Year (other than the fifth Lease Year and, in the case of a proration in accordance with the immediately preceding sentence, the final Lease Year) be less than the Annual Minimum Capital Project Amount (on a per-unit basis) in effect as of the expiration of the immediately prior Lease Year.

Annual Minimum Capital Project Amount Overage: (a) For the sixth Lease Year, an amount equal to the excess of (i)(x) the Capital Project Costs incurred and paid by Lessee in funding Capital Projects in the fifth Lease Year and for which Lessor has received an Officer’s Certificate certifying that the applicable item of Capital Project has been completed and verifying the cost of such item of Capital Project and that such cost has actually been paid or incurred by Lessee (together with such additional evidence of the completion thereof and payment therefor as Lessor may reasonably request), less (y) the amounts disbursed by Lessor to Lessee from the Replacement Reserve on account of such Capital Projects in accordance with the terms of Section 9.5.1, over (ii) the Annual Minimum Capital Project Amount for the fifth Lease Year, and (b) for the seventh Lease Year and any Lease Year thereafter, an amount equal to the excess of (i)(x) the Capital Project Costs incurred and paid by Lessee in funding Capital Projects in the immediately preceding two (2) Lease Years and for which Lessor has received an Officer’s Certificate certifying that the applicable item of Capital Project has been completed and verifying the cost of such item of Capital Project and that such cost has actually been paid or incurred by Lessee (together with such additional evidence of the completion thereof and payment therefor as Lessor may reasonably request), less (y) the amounts disbursed by Lessor to Lessee from the Replacement Reserve on account of such Capital Projects in accordance with the terms of Section 9.5.1, over (ii) the Annual Minimum Capital Project Amount for the prior two (2) Lease Year period.

Appraiser: As defined in Article XXXIV.

Architect: With respect to each Planned Capital Refurbishment Project for a Facility, the architect and/or engineer selected by Lessee in connection with the design and construction of such Planned Capital Refurbishment Project for such Facility and approved by Lessor, which approval shall not be unreasonably withheld, conditioned or delayed so long as such architect is licensed in the State in which such Facility is located and has experience with the type and scope of the project for which he/she is being retained.

Award: All compensation or other sums paid or received on a total or partial Condemnation.

Bankruptcy Code: The United States Bankruptcy Code (11 U.S.C. § 101 et seq.), and any successor statute or legislation thereto.

BLS: Bureau of Labor Statistics, U.S. Department of Labor.

Brookdale: Brookdale Senior Living Inc., a Delaware corporation, and its successors by reason of merger, consolidation or other operation of law, in each case as permitted hereunder.

Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which national banks in the City of Los Angeles, California are authorized, or obligated, by law or executive order, to close.

Capital Additions: With respect to any Facility, one or more new buildings, or one or more additional structures annexed to any portion of any of the Leased Improvements of such Facility, or the material expansion of existing Leased Improvements, which are constructed on any parcel or portion of the Land of such Facility during the Term including the construction of a new wing or new story, or the repair, replacement, restoration, remodeling or rebuilding of the existing Leased Improvements of such Facility or any portion thereof where the purpose and effect of such work is to provide a functionally new facility in order to provide services not previously offered in such Facility.

Capital Project: Repairs and replacements to the Leased Property, or any portion thereof, which are categorized under GAAP as a capital expense and not as an operating expense.

Capital Project Costs: All reasonable out-of-pocket cost incurred by Lessee in connection with a Capital Project.

Capital Stock: Any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, and any and all equivalent ownership interests in a Person (other than a corporation).

CCRC Acquisition Rent Credit: As defined in Section 3.1.4(a).

CCRC Joint Venture: CCRC PropCo Ventures, LLC, a Delaware limited liability company.

Code: The Internal Revenue Code of 1986, as amended.

Collateral: As defined in Section 16.8.1.

Collateral Agent: As defined in Section 16.8.2.

Commencement Date: The date of this Lease.

Commercial Occupancy Arrangement: Any commercial (as opposed to resident or patient) Occupancy Arrangement.

Competing Community: Any assisted living facility/community, senior independent living facility/community, memory care facility/community or continuing care retirement community operating or under construction or development within a Restricted Area. In the event that any portion of any facility/community is located within a Restricted Area, the entire facility/community shall be deemed located within the Restricted Area.

Condemnation: The exercise of any governmental power, whether by legal proceedings or otherwise, by a Condemnor or a voluntary sale or transfer by Lessor to any

Condemnor, either under threat of condemnation or while legal proceedings for condemnation are pending.

Condemnor: Any public or quasi-public authority, or private corporation or individual, having the power of Condemnation.

Consolidated Net Worth: At any time, with respect to any Person and its consolidated Subsidiaries, on a consolidated basis determined in accordance with GAAP, the Shareholders’ Equity of such Person and Subsidiaries, minus the goodwill and other intangible assets of such Person and Subsidiaries.

Controlling Person: With respect to any entity, any (i) Person(s)which, directly or indirectly (including through one or more intermediaries), controls such entity, including any partners, shareholders, principals, members, trustees and/or beneficiaries of any such Person(s)to the extent the same control such entity, and (ii) Person(s)which controls, directly or indirectly (including through one or more intermediaries), any other Person that would constitute a Controlling Person pursuant to the foregoing clause (i).

Cost of Living Index: The Consumer Price Index for All Urban Consumers, U.S. City Average (1982-1984 = 100), published by the BLS, or such other renamed index. If the BLS changes the publication frequency of the Cost of Living Index so that a Cost of Living Index is not available to make a cost-of-living adjustment as specified herein, the cost-of-living adjustment shall be based on the percentage difference between the Cost of Living Index for the closest preceding month for which a Cost of Living Index is available and the Cost of Living Index for the comparison month as required by this Lease. If the BLS changes the base reference period for the Cost of Living Index from 1982-84 = 100, the cost-of-living adjustment shall be determined with the use of such conversion formula or table as may be published by the BLS. If the BLS otherwise substantially revises, or ceases publication of the Cost of Living Index, then a substitute index for determining cost-of-living adjustments, issued by the BLS or by a reliable governmental or other nonpartisan publication, shall be reasonably selected by Lessor.

County: With respect to each Facility, the County or Township in which the Leased Property of such Facility is located.

CPI Increase: The percentage increase (rounded to two (2) decimal places), if any, in (i) the Cost of Living Index published for the month which is two (2) months prior to the commencement of the applicable Lease Year, over (ii) the Cost of Living Index published for the month which is two (2) months prior to the commencement of the immediately prior Lease Year.

Date of Taking: The date the Condemnor has the right to possession of the property being condemned.

Delayed Commencement Date: With respect to any Delayed Commencement Facility, the first date on which the conditions set forth in the Master Agreement to the leasing of such Delayed Commencement Facility pursuant to this Lease shall have been satisfied.

Delayed Commencement Facility: Any facility identified on Exhibit A-1 as a “Pool 1 Delayed Commencement” facility, on Exhibit A-2 as a “Pool 2 Delayed Commencement” facility, or on Exhibit A-3 as a “Pool 3 Delayed Commencement” facility.

Disposition Request: As defined in Section 7.4.2.

Environmental Costs: As defined in Article XXXVII.

Environmental Laws: Any and all applicable federal, state, municipal and local laws, statutes, ordinances, rules, regulations, binding and enforceable guidance or policies, orders, decrees, judgments, whether statutory or common law, as amended from time to time, now or hereafter in effect, or promulgated, pertaining to the environment, public health and safety and industrial hygiene, including the use, generation, manufacture, production, storage, release, discharge, disposal, handling, treatment, removal, decontamination, clean-up, transportation or regulation of any Hazardous Substance, including the Clean Air Act, the Clean Water Act, the Toxic Substances Control Act, the Comprehensive Environmental Response Compensation and Liability Act, the Resource Conservation and Recovery Act, the Federal Insecticide, Fungicide, and Rodenticide Act, the Safe Drinking Water Act and the Occupational Safety and Health Act.

Event of Default: As defined in Article XVI.

Excess Allocation: As defined in Section 3.1.4(c).

Existing Guaranties: As defined in Section 45.1.20.

Existing Leases: As defined in Section 45.1.20.

Extended Term: With respect to each Facility, each of (a) a term, if any, of the duration set forth with respect to such Facility on Exhibit X-0, Xxxxxxx X-0 or Exhibit A-3, as applicable, under the heading “Lease Term — 1st Extension” and (b) a term, if any, of the duration set forth with respect to such Facility on Exhibit X-0, Xxxxxxx X-0 or Exhibit A-3, as applicable, under the heading “Lease Term — 2nd Extension”, in each case for which Lessee renews this Lease with respect to such Facility in accordance with Section 19.1.

Facility(ies): Any one or more of the Pool 1 Facilities, the Pool 2 Facilities and/or the Pool 3 Facilities (including all of them collectively), as the context requires.

Facility Mortgage: As defined in Section 13.1.12.

Facility Mortgagee: As defined in Section 13.1.12.

Facility Mortgage Documents: With respect to each Facility Mortgage and Facility Mortgagee, the applicable Facility Mortgage, loan or credit agreement, lease, note and collateral assignment instruments (including collateral assignments of this Lease) and other documents or instruments evidencing, securing or otherwise relating to the loan made, credit extended, or lease or other financing vehicle pursuant thereto that encumber Lessor’s interest in, or otherwise relate to or affect, this Lease or Lessee’s obligations hereunder.

Facility Mortgage Reserve Account: As defined in Section 36.3.2.

Facility Purchase Rent Reduction: As defined in Section 3.1.4(c).

Fair Market Rental: With respect to each Facility, determined in accordance with the appraisal procedures set forth in Article XXXIV and this definition: the fair market rental value of the Leased Property and all Capital Additions of such Facility, or applicable portion(s)thereof, assuming the same is exposed on the open market at the time of the appraisal and taking into account, among other relevant factors, the income generated by the Leased Property and all Capital Additions of such Facility, or applicable portion(s)thereof, but specifically excluding brokerage commissions and other Lessor payments that do not directly inure to the benefit of lessees.

Fair Market Value: With respect to each Facility, the fair market value of the Leased Property and all Capital Additions of such Facility, or applicable portion(s)thereof, determined in accordance with the appraisal procedures set forth in Article XXXIV and this definition. Fair Market Value shall be obtained by (i) assuming that the Leased Property and all Capital Additions of such Facility, or applicable portion(s)thereof, are unencumbered by this Lease and (ii) valuing the Leased Property and all Capital Additions of such Facility, or applicable portion(s)thereof, for their highest and best use. In determining Fair Market Value in connection with a sale or transfer of the Leased Property and all Capital Additions of a Facility pursuant to the terms of this Lease, the positive or negative effect on the value of the Leased Property and all Capital Additions or applicable portion(s)thereof attributable to the interest rate, amortization schedule, maturity date, prepayment penalty and other terms and conditions of any encumbrance placed thereon by Lessor which will not be removed at or prior to the date of such sale or transfer shall be taken into account.

Fixtures: With respect to each Facility, the Fixtures (as defined in Article I) of such Facility.

GAAP: U.S. generally accepted accounting principles.

General Contractor: With respect to each Planned Capital Refurbishment Project for a Facility, the general contractor selected by Lessee in connection with the construction/performance of such Planned Capital Refurbishment Project for such Facility, which general contractor shall have all required State and local licenses and permits, be bondable and have sufficient experience with the size, type and scope of such Planned Capital Refurbishment Project for such Facility.

Governmental Authority: Any court, board, agency, administrative body, commission, office or other authority of any nature whatsoever for any governmental xxxx (xxxxxxx, xxxxx, xxxxxx, xxxxxxxx, xxxxxxxxx, xxxx or otherwise) whether now or hereafter in existence having jurisdiction and enforcing regulatory control over the Facilities or Lessee (including, without limitation, any of the foregoing having jurisdiction over the ownership, operation, use or occupancy of any Leased Property).

Gross Revenues: With respect to each Facility, all revenues received or receivable from or by reason of the operation of such Facility or any other use of the Leased

Property of such Facility, Lessee’s Personal Property,Intangible Property (other than Lessee’s IP Intangibles), and all Capital Additions, including all revenues received or receivable for the use of or otherwise attributable to units, rooms, beds and other facilities provided, meals served, services performed (including ancillary services), space or facilities subleased or goods sold on or from the Leased Property and all Capital Additions of such Facility; provided, however, that Gross Revenues shall not include: (i) bad debt in accordance with GAAP; (ii) non-operating revenues such as interest income or income from the sale of assets not sold in the ordinary course of business; and (iii) federal, state or local excise taxes and any tax based upon or measured by such revenues, where any such federal, state or local excise tax is added to or made a part of the amount billed to the patient or other recipient of such services or goods, whether included in the billing or stated separately. Gross Revenues for each Lease Year of such Facility shall reflect all cost report settlement adjustments, whether positive or negative, received in or payable during such Lease Year in accordance with GAAP relating to health care accounting, regardless of the year to which such settlement amounts are applicable; provided, however, that to the extent settlement amounts are applicable to years, or portions thereof, prior to the Commencement Date (or, in the case of a Delayed Commencement Facility, the Delayed Commencement Date with respect thereto), such settlement amounts shall not be included in Gross Revenues for the Lease Year of such Facility in which such settlement amounts are received or paid. Gross Revenues shall also include the Gross Revenues of any Occupant under a Commercial Occupancy Arrangement (i.e., the Gross Revenues generated from the operations conducted on or from such subleased, licensed or other used or occupied portion of the Leased Property and all Capital Additions of such Facility shall be included directly in the Gross Revenues); provided, however, that the rent received or receivable by Lessee from or under such Commercial Occupancy Arrangement shall be excluded from Gross Revenues for such purpose.

Guarantor: Brookdale and any other guarantor from time to time of Lessee’s obligations pursuant to this Lease pursuant to a Guaranty.

Guaranty: That certain Guaranty of Obligations dated as of the date hereof delivered by Brookdale to Lessor, and any future written guaranty of Lessee’s obligations hereunder when executed and delivered by a Guarantor pursuant to the terms of this Lease, including Article XXIV.

Handling: As defined in Article XXXVII.

Hazardous Substances: Collectively, any petroleum, petroleum product or byproduct or any dangerous, toxic or hazardous substance, material or waste regulated or listed pursuant to any Environmental Law, but excluding pharmaceuticals and other health care products to the extent such pharmaceuticals and products: (i) are related to the Primary Intended Use; (ii) would not be considered “waste” under any Environmental Law other than “solid waste”; and (iii) are used in the ordinary course of business consistent with the Primary Intended Use and in compliance with Health Care Requirements.

HCP: HCP,Inc., a Maryland corporation, and its successors and assigns.

Health Care Requirements: With respect to each Facility, all federal, state, county, municipal and other governmental statutes, laws, rules, orders, regulations, ordinances,

standards, policies, judgments, decrees and injunctions or agreements, in each case regulating the establishment, construction, ownership, operation, use or occupancy of such Leased Property or any part thereof for its Primary Intended Use and all material permits, licenses and authorizations and regulations relating thereto, including all material rules, orders, regulations and decrees of and agreements with Governmental Authorities as pertaining to such Leased Property.

Impositions: Collectively, all taxes, including capital stock, franchise, gross margins and other state, municipal and local taxes; ad valorem, sales, use, single business, gross receipts, net worth, transaction privilege, rent or similar taxes; assessments including assessments for public improvements or benefits, whether or not commenced or completed prior to the date hereof and whether or not to be completed within the Term; rents and other payments under Superior Leases; water, sewer and other utility levies and charges; excise tax levies; fees including license, permit, inspection, authorization and similar fees; and all other governmental charges, in each case whether general or special, ordinary or extraordinary, or foreseen or unforeseen, of every character, in the case of each of the foregoing, of Lessor (and of HCP as a result of its investment in Lessor), in respect of the Leased Property (including with respect to any tax parcel of which all or any portion of the Leased Property comprises any portion thereof), any Capital Additions and/or the Rent and all interest and penalties thereon attributable to any failure in payment by Lessee, which at any time prior to, during or in respect of the Term hereof may be assessed or imposed on or in respect of or be a lien upon (i) Lessor or Lessor’s interest in the Leased Property or any Capital Additions, (ii) the Leased Property, any Capital Additions or any parts thereof, or any rent therefrom or any estate, right, title or interest therein, or (iii) any occupancy, operation, use or possession of, or sales from or activity conducted on or in connection with the Leased Property, any Capital Additions or the leasing or use of the Leased Property, any Capital Additions or any parts thereof; provided, however, that nothing contained in this Lease shall be construed to require Lessee to pay (a) any tax or similar fee that is calculated based on net income, whether denominated as a franchise or capital stock or other tax) imposed on Lessor or any other Person (including on HCP), (b) any transfer tax of Lessor or any other Person except Lessee and its successors, (c) any tax or fee imposed with respect to the sale, exchange or other disposition by Lessor of any Leased Property, any Capital Additions or the proceeds thereof, or (d) except as expressly provided elsewhere in this Lease, any principal or interest or taxes on any indebtedness on the Leased Property for which Lessor is the obligor, except to the extent that any tax, fee, assessment, tax levy or charge, of the type described in any of clauses (a), (b), (c)or (d)above is levied, assessed or imposed in lieu of or as or as a substitute for any tax, fee assessment, levy or charge which is otherwise included in this definition of an “Imposition”. Without limiting any of the foregoing, and for ease of administration, the attached Schedule 1 specifies the parties’ agreement with respect to certain Impositions for all states in which real property subject to this Lease is located. The attached Schedule 1 will remain in effect for the listed Impositions for the listed states so long as the taxes incurred by Lessor (and by HCP as a result of its investment in Lessor) under the listed states’ taxing regimes do not change due to a change in any listed state’s tax statutes or changes in any state’s interpretation of existing state tax statutes, as applied to the taxation of REITs or REIT subsidiaries, and thereafter, the parties agree to cooperate to reasonably reconsider the appropriate allocations of such taxes hereunder, but without any obligation on Lessor or Lessee to agree to any amendment to this Lease as a result thereof. The attached Schedule 1 is intended to clarify, where it may be uncertain, whether or not those taxes are income taxes. All other Impositions are applicable to all states covered under this Lease.

Improvements: As defined in Article I, or, with respect to any one or more specified Facility or Facilities, the Improvements (as defined in Article I) of such Facility or Facilities.

Indemnified Liabilities: As defined in Section 23.1.

Initial Appraisal Period: As defined in Section 34.1.

Initial Term: Collectively, the Pool 1 Fixed Term, the Pool 2 Fixed Term, and the Pool 3 Fixed Term.

Insurance Premium Impound Account Trigger Event: Any failure by Lessee to pay insurance premiums as and when required by Section 4.1 more than two (2) times during any twenty-four (24) month period. Any Insurance Premium Impound Account Trigger Event shall continue for a period of twenty-four (24) months (provided that, if any additional failure to pay any such insurance premiums occurs in such twenty-four (24) month period, such period will restart upon the occurrence of such additional failure to pay such insurance premiums).

Insurance Requirements: The terms of any insurance policy required by this Lease and all requirements of the issuer of any such policy and of any insurance board, association, organization or company necessary for the maintenance of any such policy.

Intangible Property: With respect to each Facility, all accounts, proceeds of accounts, rents, profits, income or revenues derived from the use of rooms or other space within the Leased Property of such Facility or the providing of services in or from the Leased Property and all Capital Additions of such Facility; documents, chattel paper, instruments, contract rights, deposit accounts, general intangibles, commercial tort claims, causes of action, investment property, letter of credit rights, letters of credit, money and securities entitlements, now owned or hereafter acquired by Lessee (including any right to any refund of any Impositions) arising from or in connection with Lessee’s operation or use of the Leased Property and all Capital Additions of such Facility; all licenses and permits now owned or hereinafter acquired by Lessee, which are necessary or desirable for Lessee’s use of the Leased Property and all Capital Additions of such Facility for its Primary Intended Use, including, if applicable, any certificate of need or similar certificate; the right to use any trade name or other name associated with such Facility; and any and all third-party provider agreements (including Medicare and Medicaid). Notwithstanding the foregoing to the contrary, in each instance in which “Intangible Property” is used in this Lease, to the extent that applicable Legal Requirements prohibit the use, assignment or other handling or treatment of any of the property, rights or other interests identified herein as “Intangible Property” in the manner described in or permitted or required by any such provision hereof, then such property, rights or other

interests so restricted by applicable Legal Requirements shall be deemed not to be included as “Intangible Property” for the purposes of such provision.

Land: As defined in Article I, or, with respect to each Facility, the Land (as defined in Article I) relating to such Facility.

Lease: As defined in the preamble.

Lease Rate: A rate initially equal to seven percent (7%). The Lease Rate shall increase: (i) upon the commencement of the second Lease Year, by [***]; (ii) upon the commencement of each of the third and fourth Lease Years, by [***]; and (iii) upon the commencement of each Lease Year thereafter (commencing with the fifth Lease Year), by the greater of (a) [***] and (b) the CPI Increase, but not to exceed [***]. For avoidance of doubt, each such increase shall be applied after giving effect to any and all prior increases.

Lease Year: Each calendar year during the Term, provided that the first Lease Year shall be the period commencing on the Commencement Date and ending on December 31 of the calendar year in which the Commencement Date occurs and the last Lease Year shall be the period commencing on January1 of the calendar year in which this Lease expires or is terminated and ending on the effective date of such expiration or termination.

Leased Improvements: As defined in Article I, or, with respect to each Facility, the Leased Improvements (as defined in Article I) of such Facility.

Leased Property: As defined in Article I, or, with respect to each Facility, the Leased Property (as defined in Article I) of such Facility.

Leasehold FMV: With respect to each Facility, the fair market value of Lessee’s leasehold interest relating to such Facility if exposed on the open market taking into account, among other relevant factors, the income generated from the Leased Property and any Capital Additions for such Facility (utilizing Lessee’s actual net operating income generated by the Leased Property and all Capital Additions of the subject Facility for the trailing twelve (12) whole calendar months immediately preceding the effective date of the subject Transfer), determined by appraisal in accordance with the appraisal procedures set forth in Article XXXIV.

Legal Requirements: With respect to each Facility (a) all federal, state, county, municipal and other governmental statutes, laws (including all Health Care Requirements and Environmental Laws), rules, policies, guidance, codes, orders, regulations, ordinances, permits, licenses, covenants, conditions, restrictions, judgments, decrees and injunctions of any Governmental Authority, affecting the Leased Property, Lessee’s Personal Property,Intangible Property and all Capital Additions or the construction, use or alteration thereof, whether now or hereafter enacted and in force, including any which may (i) require repairs, modifications or alterations in or to the Leased Property, Lessee’s Personal Property and all Capital Additions, (ii) in any way adversely affect the use and enjoyment thereof, or (iii) regulate the transport, handling, use, storage or disposal or require the cleanup or other treatment of any Hazardous Substance, and (b) all covenants, agreements, restrictions, and encumbrances either now or hereafter of record or known to Lessee (other than encumbrances created by Lessor without the consent of Lessee except as otherwise expressly permitted hereunder) affecting the Leased Property.

Lessee: As defined in the preamble.

Lessee’s IP Intangibles: As defined in Section 16.8.

Lessee Parties: Lessee, any Guarantor and any Subsidiary of Lessee or Guarantor.

Lessee’s Personal Property: With respect to each Facility, all of Lessee’s right, title and interest in and to all computers, vehicles and consumables allocable or relating to such Facility, together with all replacements, modifications, alterations and substitutes therefor (whether or not constituting an upgrade) and any other Personal Property hereafter acquired by Lessee.

Lessor: As defined in the preamble.

Lessor’s Personal Property: As defined in Article I, or, with respect to each Facility, Lessor’s Personal Property (as defined in Article I) allocable or relating to such Facility.

Maintenance Program: As defined in Section 9.4.

Master Agreement: That certain Master Contribution and Transactions Agreement dated as of April 23, 2014, by and between HCP and Brookdale.

Portions of this exhibit that have been marked by [***] have been omitted pursuant to a request for confidential treatment filed separately with the Securities and Exchange Commission.

Master Sublease: With respect to any Facility, any Commercial Occupancy Arrangement with respect to more than ten percent (10%) of the square footage within such Facility in the aggregate to any Person and/or its Affiliates, directly or indirectly, or through one or more step transactions or tiered transactions (including subleases or sub-subleases).

Material Alteration: As defined in Section 10.1.

Minimum Rent: For each Lease Year, the sum of the then in effect Pool 1 Minimum Rent, Pool 2 Minimum Rent and Pool 3 Minimum Rent, to the extent that this Lease remains in effect for any Facilities in each of such groups, respectively, during the subject Lease Year.

Minimum Purchase Price: With respect to each Facility at any given time, the sum of (i) the Allocated Initial Investment with respect to such Facility, plus (ii) any costs paid, funded or accrued by Lessor in connection with any capital projects (provided, that in no event shall Lessor have any obligation to provide or procure any financing for any such capital projects except as expressly provided in this Lease) with respect to such Facility.

Mold: Mold, mildew, fungus or similar organisms in concentrations or quantities that could reasonably be considered to pose a threat to human health or that are otherwise hazardous or toxic or regulated pursuant to Environmental Law or Mold Remediation Requirements.

Mold Condition: The presence or suspected presence of Mold or any condition(s)that reasonably can be expected to give rise to or indicate the presence of Mold, including observed or suspected instances of water damage or intrusion, the presence of wet or damp wood, cellular wallboard, floor coverings or other materials, inappropriate climate control, discoloration of walls, ceilings or floors, or any notice from a Governmental Authority regarding the indoor air quality due to the presence of Mold at the Leased Property.

Mold Inspector: An industrial hygienist certified by the American Board of Industrial Hygienists (“CIH”) or an otherwise qualified mold consultant selected by or otherwise reasonably acceptable to Lessor.

Mold Remediation Requirements: The relevant provisions of the document Mold Remediation in Schools and Commercial Buildings (EPA 402-K-01-001, March 2001), published by the U.S. Environmental Protection Agency, as may be amended or revised from time to time, or any other applicable Legal Requirements, or Environmental Law relating to Mold or Mold Conditions.

New Lease: As defined in Section 31.2.1.

New Lease Effective Date: As defined in Section 31.2.1.

New Master Lease: As defined in Section 31.3.

Nonqualifying Income: As defined in Section 7.4.3.

Occupancy Arrangement: Any sublease, license or other arrangement with a Person for the right to use, occupy or possess any portion of the Leased Property and/or any Capital Additions.

Occupant: Any Person having rights of use, occupancy or possession under an Occupancy Arrangement.

OFAC: As defined in Section 40.1(f).

OFAC Order: As defined in Section 40.1(f).

Officer’s Certificate: A certificate of Lessee signed by an officer authorized to so sign by its board of directors or by-laws or by equivalent governing documents or managers.

Orders: As defined in Section 40.1(f).

Other Lease: Any of the following: (a) that certain Lease and Security Agreement dated March 26, 2013, between HCP SH River Road, LLC and Emeritus Corporation, (b) that certain Lease and Security Agreement dated March 26, 2013, between HCP XX Xxxxxxxxx Village, LLC and Emeritus Corporation, (c) that certain Lease and Security Agreement dated March 26, 2013, between HCP SH Hermiston Terrace, LLC and Emeritus Corporation, or (d) that certain Master Lease and Security Agreement dated October 31, 2012, between HCP SH ELP1Properties, LLC, HCP SH ELP2 Properties, LLC and HCP SH ELP3 Properties, LLC, as lessors, and Emeritus Corporation, as lessee, in each case as the same may have been amended, supplemented or otherwise modified.

Outside Disposition Date: As defined in Section 7.4.2.

Overdue Rate: On any date, a rate equal to two percent (2%) above the Prime Rate, but in no event greater than the maximum rate then permitted under applicable law.

Payment Date: Any due date for the payment of the installments of Minimum Rent or any other sums payable under this Lease.

Permitted Encumbrances: With respect to any Facility, easements, encumbrances, covenants, conditions and restrictions and other matters which affect the Leased Property which are of record or are created after the date hereof as permitted hereunder.

Permitted Affiliate Transaction: As defined in Section 24.1.12.

Person: Any individual, corporation, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other form of entity.

Personal Property: With respect to each Facility, all machinery, furniture and equipment, including phone systems and computers, trade fixtures, inventory (including raw materials, work in process and finished goods), supplies and other tangible personal property used at the Leased Property and Capital Additions of such Facility for their Primary Intended Use, other than Fixtures.

Planned Capital Refurbishment Project: As defined in Section 9.8.1.

Planned Capital Refurbishment Project Cost(s): The cost of the Planned Capital Refurbishment Projects for a given Facility or for all Facilities collectively, as the context requires.

Planned Capital Refurbishment Project Lessor Funding Amount: One Hundred Million Dollars ($100,000,000).

Plans and Specifications: Reasonably detailed plans and specifications prepared by the Architect for the work to be performed in connection with a Planned Capital Refurbishment Project with respect to any Facility.

Pool(s): As the context requires, any one or more of the Facility groupings set forth in on Exhibits A-1 through A-3 hereto, respectively as Pool 1, Pool 2 and Pool 3.

Pool 1 Facility(ies): Any one or more of the facilities being (and to be) operated or proposed to be operated on the Leased Property (including all of them collectively), as the context requires, as more particularly described on Exhibit A-1 attached hereto and incorporated herein by this reference, together with any Capital Additions thereto.

Pool 1 Fixed Term: The period of time commencing on the Commencement Date and ending at 11:59 p.m. Los Angeles time on the last day of the calendar month in which the fouteenth (14th) anniversary of the Commencement Date occurs.

Pool 1 Minimum Rent: The sum of the Allocated Minimum Rent for all Pool 1 Facilities.

Pool 2 Facility(ies): Any one or more of the facilities being (and to be) operated or proposed to be operated on the Leased Property (including all of them collectively), as the context requires, as more particularly described on Exhibit A-2 attached hereto and incorporated herein by this reference, together with any Capital Additions thereto.

Pool 2 Fixed Term: The period of time commencing on the Commencement Date and ending at 11:59 p.m. Los Angeles time on the last day of the calendar month in which the fifteenth (15th) anniversary of the Commencement Date occurs.

Pool 2 Minimum Rent: The sum of Allocated Minimum Rent for all Pool 2 Facilities.

Pool 3 Facility(ies): Any one or more of the facilities being (and to be) operated or proposed to be operated on the Leased Property (including all of them collectively), as the context requires, as more particularly described on Exhibit A-3 attached hereto and incorporated herein by this reference, together with any Capital Additions thereto.

Pool 3 Fixed Term: The period of time commencing on the Commencement Date and ending at 11:59 p.m. Los Angeles time on the last day of the calendar month in which the sixteenth (16th) anniversary of the Commencement Date occurs.

Pool 3 Minimum Rent: The sum of Allocated Minimum Rent for all Pool 3 Facilities.

Portfolio Acquisition: As defined in Section 7.4.2.

Pre-Adjusted Allocated Minimum Rent: As defined in Section 3.1.1.

Pre-Adjusted Minimum Rent: As defined in Section 3.1.1.

Pre-Existing Projects: As defined in Section 10.1.

Primary Intended Use: With respect to each Facility, the licensed use(s)set forth under the heading “Primary Intended Use” on Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto and incorporated herein by this

reference with respect to such Facility, such other uses necessary or incidental to such use and any change to such Primary Intended Use approved by Lessor in accordance with Section 7.2.2 hereof.

Prime Rate: On any date, a rate equal to the annual rate on such date announced by Bank of America, N.A. to be its prime, base or reference rate for ninety (90) day unsecured loans to its corporate borrowers of the highest credit standing but in no event greater than the maximum rate then permitted under applicable law. If Bank of America, N.A. discontinues its use of such prime, base or reference rate or ceases to exist, Lessor shall designate the prime, base or reference rate of another state or federally chartered bank based in Los Angeles or New York to be used for the purpose of calculating the Prime Rate hereunder.

Prior Period Pre-Adjusted Minimum Rent: As to any Lease Year, the annual rate of Pre-Adjusted Minimum Rent that was applicable immediately prior to the commencement ofsuch Lease Year (without, for avoidance of doubt, giving effect to any adjustments in accordance with Section 3.1.4). By way of illustration only, the Prior Period Pre-Adjusted Minimum Rent applicable to Lease Year 2 shall equal the annual rate of Pre-Adjusted Minimum Rent that was applicable as of the end of Lease Year 1.

Project Budget: With respect to a Planned Capital Refurbishment Project at any Facility, a reasonably detailed final budget, which budget shall also provide a reasonably detailed cost breakdown of all Planned Capital Refurbishment Project Costs with respect thereto.

Proprietary Information: (a) All computer software and accompanying documentation (including all upgrades, enhancements, additions, substitutions and modifications thereof), other than that which is commercially available, which are used by Lessee or any of its Affiliates in connection with Lessee’s property management system for the Facilities, (b) all policies, manuals, brochures and directives used by Lessee or any of its Affiliates with respect to the procedures and techniques to be used in operating the Facilities, (c) Lessee’s employee records which must remain confidential (as confirmed by Lessee to Lessor in writing) either under applicable Legal Requirements or under reasonable corporate policies of Lessee and its Affiliates and employee manuals and handbooks, (d) terms of any national contracts of Lessee or any of its Affiliates in connection with Lessee’s property management of the Facilities, (e) materials related to memory care, “Optimum Life” or “Innovative Senior Care” or any replacement service offerings thereof, (f) lead data, prospective customer names, non-public advertising and marketing materials, competitive analyses, referral source lists, and (g) with respect to any Facility, unless a notice of termination of this Lease with respect to such Facility or all of the Facilities shall have been delivered, the names of the residents of such Facility.

Purchase Obligation Exercise: As defined in Section 18.2.

Put Event: With respect to any Facility an Event of Default hereunder arising pursuant to any of Sections 16.1(b)through 16.1(e), 16.1(f)(arising out of (i) a breach or default by Lessee during the Term of any of its obligations or covenants pursuant to any of Sections 7.2.1, 7.2.2, 7.2.3, 7.2.5, 7.4, 37.1 or 37.2 or (ii) any other failure of Lessee to obtain and maintain all material licenses, permits and other authorizations to use and operate such Facility for its Primary Intended Use in accordance with all Legal Requirements), 16.1(k)relating to such Facility, 16.1(l)(arising out of a breach of any material representation or warranty of Lessee or any Guarantor in any such document relating to such Facility), 16.1(m)relating to such Facility and/or 16.1(o)relating to such Facility. Notwithstanding that Lessor and Lessee have specifically defined a “Put Event” for the limited purpose of setting forth the circumstances under which Lessor shall be entitled to the remedy set forth in Section 16.5, in no event shall this definition derogate the materiality of any other Event of Default (including any Event of Default which does not constitute a Put Event) or otherwise limit Lessor’s rights and remedies upon the occurrence of any such Event of Default, including those rights and remedies set forth in Sections 16.2, 16.3, 16.4 and/or 16.9.

Real Estate Tax Impound Account Trigger Event: A failure by Lessee to pay Impositions as and when required by Section 4.1 relating to real estate taxes more than two (2) times during any twenty-four (24) month period. Any Real Estate Tax Impound Account Trigger Event shall continue for a period of twenty-four (24) months (provided that, if anyadditional failure to pay any such Impositions occurs in such twenty-four (24) month period, such period will restart upon the occurrence of such additional failure to pay such Impositions).

REIT: A “real estate investment trust” within the meaning of Sections 856 through 860 of the Code.

REIT Requirements: As defined in Section 7.4.3.

Renewal Option Period: As defined in Section 19.1.

Rent: Collectively, the Minimum Rent, Additional Charges and all other amounts payable under this Lease.

Replacement Reserve: As defined in Section 9.5.1.

Request for Reimbursement: With respect to each Planned Capital Refurbishment Project for a Facility, certificates of Lessee and, to the extent applicable, the Architect, in each case on the appropriate AIA form, including form G702 together with attached AIA form G703 (or equivalent, which AIA form G703 or equivalent shall be modified to include columns for the original estimate of scheduled values for each line item, changes to the scheduled values for each line item and a revised scheduled value for each line item after any such change) and/or such other form(s)as Lessor may hereafter reasonably request which shall: (i) set forth the Persons to whom money was owed, and the amounts owed and paid to each, in connection with such Planned Capital Refurbishment Project; (ii) certify among other things that such amounts represent payments due for services actually rendered or materials actually acquired or

furnished in connection with the construction/performance of such Planned Capital Refurbishment Project; (iii) state that all Planned Capital Refurbishment Project Costs for such Planned Capital Refurbishment Project have been paid in full and that the Planned Capital Refurbishment Project has been completed in accordance with Section 9.8.4; (iv) be accompanied by copies of billing statements, fee schedules, documentation supporting all costs, copies of all subcontracts not previously submitted and vouchers or invoices from the Persons named therein, in form reasonably satisfactory to Lessor; and (v) be accompanied by appropriate final and unconditional waivers of all lien rights with respect to such Planned Capital Refurbishment Project (to the extent not previously received by Lessor) executed by the General Contractor (if any) and all contractors, subcontractors, mechanics, materialmen and other Persons with such lien rights and whose charges are greater than Fifty Thousand Dollars ($50,000); provided, however, that a Request for Reimbursement with respect to a Planned Capital Refurbishment Project shall in no event require any certification from an Architect if an Architect has not been engaged by or on behalf of Lessee or any of its Affiliates in connection therewith.

Required Governmental Approvals: With respect to each Facility, all licenses, permits, accreditations, authorizations and certifications from any Governmental Authority which are material to or required for (i) the operation of such Facility and any Capital Addition thereto for its Primary Intended Use in accordance with all applicable, material Legal Requirements, including, without limitation, material state facility licenses, certificates of need, permits, provider agreements and accreditations or certifications from Medicare and/or Medicaid, and (ii) for any other use conducted on the Leased Property of such Facility and anyCapital Additions thereto as may be permitted from time to time hereunder in accordance with all applicable, material Legal Requirements.

Restricted Area: Any area lying within a [***] mile radius measured outward from the outside boundaries of the Land on which any Facility is located. All distances shall be measured on a straight-line (rather than on a driving-distance) basis.

SEC: Securities and Exchange Commission.

Separated Property: As defined in Section 31.2.

Separation Event:

(i)The sale, conveyance or other transfer by Lessor of all or any portion of its interest in the Leased Property of one (1)or more Facilities;

(ii)The sale, conveyance or other transfer of all or any portion of the stock, partnership, membership or other equity interests in Lessor;

(iii)Any financing by Lessor or any Affiliate of Lessor of all or any portion of its interests in the Leased Property of one (1)or more Facilities, including through a Facility Mortgage, the pledge of the stock, partnership, membership or other equity interests in Lessor or other means; or

(iv)The succession by any lender to Lessor or any Affiliate, whether directly or indirectly, to the interests of Lessor under this Lease, including through foreclosure or deed or other conveyance in lieu of foreclosure or in satisfaction of debt.

Shareholders’ Equity: With respect to any Person, the shareholders’, members’ or partners,’ beneficiaries’ or other equity of such Person, determined on a consolidated basis in accordance with GAAP.

Special Rent Credit: As defined in Section 3.1.4(b).

State: Except as otherwise indicated herein, with respect to each Facility, the State or Commonwealth in which the Leased Property for such Facility is located.

Subsidiaries: Corporations, partnerships, limited liability companies, business trusts or other legal entities with respect to which a Person owns, directly or indirectly (including through one or more intermediaries), more than fifty percent (50%) of the voting stock or partnership, membership or other equity interest, respectively.

Successor Operator: As defined in Section 45.1.4.

Portions of this exhibit that have been marked by [***] have been omitted pursuant to a request for confidential treatment filed separately with the Securities and Exchange Commission.

Superior Lessor: The lessor under a Superior Lease.

Superior Lease: Those leases described on Schedule 36.4 attached hereto and made a part hereof.

Target Property: As defined in Section 18.3.

Term: Each of the Pool 1 Fixed Term, Pool 2 Fixed Term and Pool 3 Fixed Term, as applicable and any Extended Terms thereof, as applicable, unless earlier terminated pursuant to the provisions hereof.

Third Appraiser: As defined in Section 34.1.1.

Transfer: As defined in Article XXIV.

Transfer Consideration: With respect to any Transfer constituting a Master Sublease of a Facility, “Transfer Consideration” shall mean fifty percent (50%) of the positive difference, if any, between the Fair Market Rental and the Allocated Minimum Rent payable by Lessee under this Lease determined on a monthly basis with respect to such Facility, prorating such Allocated Minimum Rent as appropriate, if less than all of the applicable Facility is Master Subleased. Fifty percent (50%) of such positive difference shall be paid by Lessee to Lessor monthly when the Allocated Minimum Rent is due for such Facility; provided, however, that in no event shall the total Transfer Consideration to which Lessor is entitled in connection with any such Master Sublease exceed the Total Consideration (as hereinafter defined) payable directly or indirectly to Lessee, to any Controlling Person(s)or to any other Person in exchange for, in connection with, related to or arising out of the transaction(s)as to which such Master Sublease is a part. With respect to any other Transfer relating to any Facility or all Facilities (i.e., a Transfer other than pursuant to a Master Sublease), “Transfer Consideration” shall mean fifty percent (50%) of the positive Leasehold FMV of such Facility(ies); provided, however, that in no event shall the total Transfer Consideration to which Lessor is entitled in connection with any such other Transfer exceed the Total Consideration payable directly or indirectly to Lessee, to any Controlling Person(s)or to any other Person in exchange for, in connection with, related to or arising out of the transaction(s)as to which such other Transfer is a part. As used herein, the term “Total Consideration” shall mean and include money and the fair market value of any services, property and other things of value, including payment of costs, cancellation or forgiveness of indebtedness, discounts, rebates, barter and the like. For purposes of Section 24.1.2.2 and the payment of Transfer Consideration to Lessor as provided in this Lease, if any Transfer Consideration otherwise payable is due from and based on Total Consideration payable to Lessee, any Controlling Person(s)or to any other Person in exchange for, in connection with, related to or arising out of such Transfer as provided above, (a) where such Total Consideration is payable on a deferred basis (the “Deferred Total Consideration”), then the amount of the Transfer Consideration due from and based on any such Deferred Total Consideration shall be payable to Lessor as and when paid to Lessee, to any Controlling Person(s)or to any such other Person or (b) where such Total Consideration is payable in a form other than immediately available cash, then the amount of Transfer Consideration due from and based on the fair market value of such non-cash Total Consideration shall be payable to Lessor in the form of immediately available cash promptly following receipt by or credit to Lessee, any Controlling Person(s)or any such other Person of such non-cash Total Consideration. Lessee acknowledges and agrees that the terms under which Lessor is entitled to the payment ofTransfer Consideration pursuant to this Lease and the amount thereof has been freely negotiated and represents a fair and equitable division with Lessor of the consideration payable in connection with a Transfer taking into account, among other things, Lessor’s investment in the Leased Property, the terms of this Lease and the inherent risks of owning and leasing real property.

Unsuitable for Its Primary Intended Use: With respect to each Facility, a state or condition of such Facility such that by reason of damage or destruction or Condemnation, in the good faith judgment of Lessor, such Facility cannot be operated on a commercially practicable basis for its Primary Intended Use.

Windstorm and Flood Insurance: As defined in Section 13.4.

ARTICLE III.

3.1Rent. Lessee shall pay to Lessor in lawful money of the United States of America which shall be legal tender for the payment of public and private debts, without offset or deduction, the amounts set forth hereinafter as Minimum Rent during the Term. Payments of Minimum Rent shall be made by wire transfer of funds initiated by Lessee to Lessor’s account or to such other Person as Lessor from time to time may designate in writing. For the avoidance of doubt, Lessee shall have no right to prepay all or any portion of the Rent hereunder prior to the Commencement Date.

3.1.1Minimum Rent. From and after the Commencement Date and continuing through the Term, Lessee shall pay to Lessor Minimum Rent monthly, in advance on or before the first day of each calendar month, at an annual rate equal, in the aggregate, to the sum of the amounts set forth for all of the Facilities under the heading “Initial Annual Allocated Minimum Rent” on each of Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto, as such amounts may be (a) increased from time to time in accordance with Section 3.1.3 (such amounts, as the same may have been increased in accordance with Section 3.1.3, the “Pre-Adjusted Minimum Rent”) and (b) only after giving effect to any increases theretofore applied in accordance with Section 3.1.3, adjusted from time to time in accordance with Section 3.1.4. Such Minimum Rent shall be allocated or attributed for certain purposes of this Lease to the Facilities in the respective amounts set forth in Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto, as such amounts may be (i) increased from time to time in accordance with Section 3.1.3 (the applicable amount set forth in Exhibit X-0, Xxxxxxx X-0 or Exhibit A-3, as the case may be, for any Facility, as the same may have been increased in accordance with Section 3.1.3, the “Pre-Adjusted Allocated Minimum Rent”) and (ii) only after giving effect to any

increases theretofore applied in accordance with Section 3.1.3, adjusted from time to time in accordance with Section 3.1.4.

3.1.2Intentionally Omitted.

3.1.3Pre-Adjusted Minimum Rent. During the first Lease Year (i.e., commencing on the Commencement Date and for the period through December 31, 2014), the Pre-Adjusted Minimum Rent shall be equal to the sum of the amounts set forth for all of the Facilities under the heading “Initial Annual Allocated Minimum Rent” on each of Exhibit X-0,Xxxxxxx X-0 and Exhibit A-3 attached hereto. During the second Lease Year (i.e., commencing on January 1, 2015 and for the period through December 31, 2015), the Pre-Adjusted Minimum Rent shall be an amount equal to the sum of (x) the Prior Period Pre-Adjusted Minimum Rent, plus (y) the product of (a) the Prior Period Pre-Adjusted Minimum Rent and (b) three and one-half percent (3.5%). During the third Lease Year (i.e., commencing on January 1, 2016 and for the period through December 31, 2016), the Pre-Adjusted Minimum Rent shall be an amount equal to the sum of (x) the Prior Period Pre-Adjusted Minimum Rent, plus (y) the product of (a) the Prior Period Pre-Adjusted Minimum Rent and (b) three percent (3%). During the fourth Lease Year (i.e., commencing on January 1, 2017 and for the period through December 31, 2017), the Pre-Adjusted Minimum Rent shall be an amount equal to the sum of (x) the Prior Period Pre-Adjusted Minimum Rent, plus (y) the product of (a) the Prior Period Pre-Adjusted Minimum Rent and (b) three percent (3%). During the fifth Lease Year (i.e., commencing on January 1, 2018 and for the period through December 31, 2018) and for each Lease Year thereafter, the Pre-Adjusted Minimum Rent for the applicable Lease Year shall be an amount equal to the sum of (x) the Prior Period Pre-Adjusted Minimum Rent applicable to such Lease Year, plus (y) the product of (a) the Prior Period Pre-Adjusted Minimum Rent applicable to such Lease Year and (b) the greater of (i) two and one-half percent (2.5%) and (ii) the CPI Increase, but not to exceed five percent (5%) (the Pre-Adjusted Minimum Rent amount determined in accordance with the foregoing formulas, to be known as the “Ordinary Minimum Rent Increase Amount”). Notwithstanding the foregoing provisions of this Section 3.1.3, (A) if at any time Lessor funds any amount on account of a Planned Capital Refurbishment Project at a Facility in accordance with Section 9.8, the then-current Pre-Adjusted Allocated Minimum Rent for such Facility (and the then-current Pre-Adjusted Minimum Rent) shall be increased on the date of such funding by an amount equal to the product of (I)the amount so funded and (II)the Lease Rate and (B) if at any time Escrow closes for the purchase of the Leased Property of any Facility in accordance with Section 31.4.3(c), the Excess Allocation with respect to such Facility (if any) shall be reallocated to the other Facilities then subject to this Lease (in proportion to their respective Allocated Minimum Rents) so as to increase accordingly the then-current Pre-Adjusted Allocated Minimum Rent for each other Facility for the period commencing on the date of such closing and continuing through the end of the Term (and increase accordingly the Pre-Adjusted Minimum Rent).

3.1.4Rent Adjustments. The Allocated Minimum Rent and the Minimum Rent for any Lease Year shall be equal to (1) the Pre-Adjusted Allocated Minimum Rent and the Pre-Adjusted Minimum Rent, respectively, for such Lease Year (as determined in accordance with Section 3.1.3), less (2) the amount of the applicable CCRC Acquisition Rent Credit (as determined in accordance with Section 3.1.4(a)), if any, less (3) the amount of the applicable Special Rent Credit (as determined in accordance with Section 3.1.4(b)), if any, less (4)the aggregate amount of any and all applicable Facility Purchase Rent Reductions (as determined in accordance with Section 3.1.4(c)). As used in this Section 3.1, the following terms shall have the following meanings:

(a)The “CCRC Acquisition Rent Credit” shall mean [***].

(b)The “Special Rent Credit” shall mean (i) with respect to the third Lease Year, a deduction from the Pre-Adjusted Allocated Minimum Rent with respect to each Facility for such Lease Year in the applicable amount specified for such Facility under the heading “2016 Allocated Special Rent Credit” on Exhibit X-0, Xxxxxxx X-0 or Exhibit A-3, as the case may be (and a corresponding deduction from the Pre-Adjusted Minimum Rent for such Lease Year in an amount equal to the sum of all of such specified amounts) and (ii) with respect to the fourth Lease Year and each Lease Year thereafter, a deduction from the Pre-Adjusted Allocated Minimum Rent with respect to each Facility for such Lease Year in the applicable amount specified for such Facility under the heading “Subsequent Special Rent Credit” on Exhibit X-0, Xxxxxxx X-0 or Exhibit A-3, as the case may be (and a corresponding deduction from the Pre-Adjusted Minimum Rent for such Lease Year in an amount equal to the sum of all of such specified amounts). For avoidance of doubt, there shall be no Special Rent Credit with respect to the first and second Lease Years.

(c)The “Facility Purchase Rent Reduction” shall mean, with respect to the closing of Escrow for the purchase of the Leased Property of any Facility in accordance with Section 31.4.3(c), a deduction from the Pre-Adjusted Allocated Minimum Rent with respect to such Facility (and a corresponding deduction from the Pre-Adjusted Minimum Rent) for the period commencing on the date of such closing and continuing through the end of the Lease Year in which such closing occurs and for each Lease Year thereafter, in each case in an amount equal to the product of (i) the purchase price paid for the Leased Property of such Facility to Lessor and (ii) [***] (provided that such amount shall be prorated for such period if it represents a partial year). The “Excess Allocation” shall mean, with respect to any Facility purchased in accordance with Section 31.4.3(c), the excess, if any, of (x) the Pre-Adjusted Allocated Minimum Rent for such Facility immediately prior to the date of the closing of Escrow for such purchase over (y) the amount of the Facility Purchase Rent Reduction in respect of such purchase.

Portions of this exhibit that have been marked by [***] have been omitted pursuant to a request for confidential treatment filed separately with the Securities and Exchange Commission.

3.1.5Rent Pro-Rations. Notwithstanding any contrary provision of Section 3.1, (i) the first monthly payment of Minimum Rent shall be payable on the Commencement Date (prorated as to any partial calendar month at the beginning of the Term), (ii) the last monthly payment of Minimum Rent shall be prorated as to any partial calendar month at the end of the Term, and (iii) in the event that the first day of any calendar month is not a Business Day, then such payment shall be due on the next Business Day immediately following such first day of the subject calendar month.

3.2Additional Charges. In addition to the Minimum Rent, (i) subject to Article XII regarding permitted contests, Lessee shall also pay and discharge as and when due and payable all other amounts, liabilities, obligations and Impositions which Lessee assumes or agrees to pay under this Lease in accordance with the terms hereof; and (ii) in the event of any failure on the part of Lessee to pay any of those items referred to in clause (i)above, Lessee shall also promptly pay and discharge every fine, penalty, interest and cost which may be added for non-payment or late payment of such items (the items referred to in clauses (i)and (ii)above being referred to herein collectively as the “Additional Charges”), and Lessor shall have all legal, equitable and contractual rights, powers and remedies provided either in this Lease or by statuteor otherwise in the case of non-payment of the Additional Charges as in the case of non-payment of the Minimum Rent.

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3.3Late Payment of Rent.

LESSEE HEREBY ACKNOWLEDGES THAT LATE PAYMENT BY LESSEE TO LESSOR OF RENT WILL CAUSE LESSOR TO INCUR COSTS NOT CONTEMPLATED HEREUNDER, THE EXACT AMOUNT OF WHICH IS PRESENTLY ANTICIPATED TO BE EXTREMELY DIFFICULT TO ASCERTAIN. ACCORDINGLY,IF ANY INSTALLMENT OF RENT OTHER THAN ADDITIONAL CHARGES PAYABLE TO A PERSON OTHER THAN LESSOR SHALL NOT BE PAID WITHIN FIVE (5)BUSINESS DAYS AFTER ITS DUE DATE, LESSEE WILL PAY LESSOR ON DEMAND A LATE CHARGE EQUAL TO THE LESSER OF (I)THREE PERCENT (3%) OF THE AMOUNT OF SUCH INSTALLMENT OR (II)THE MAXIMUM AMOUNT PERMITTED BY LAW. THE PARTIES AGREE THAT THIS LATE CHARGE REPRESENTS A FAIR AND REASONABLE ESTIMATE OF THE COSTS THAT LESSOR WILL INCUR BY REASON OF LATE PAYMENT BY LESSEE. THE PARTIES FURTHER AGREE THAT SUCH LATE CHARGE IS RENT AND NOT INTEREST AND SUCH ASSESSMENT DOES NOT CONSTITUTE A LENDER OR BORROWER/CREDITOR RELATIONSHIP BETWEEN LESSOR AND LESSEE. IN ADDITION, THE AMOUNT UNPAID,INCLUDING ANY LATE CHARGES, SHALL BEAR INTEREST AT THE OVERDUE RATE COMPOUNDED MONTHLY FROM THE DUE DATE OF SUCH INSTALLMENT TO THE DATE OF PAYMENT THEREOF, AND LESSEE SHALL PAY SUCH INTEREST TO LESSOR ON DEMAND. THE PAYMENT OF SUCH LATE CHARGE OR SUCH INTEREST SHALL NOT CONSTITUTE WAIVER OF, NOR EXCUSE OR CURE, ANY DEFAULT UNDER THIS LEASE, NOR PREVENT LESSOR FROM EXERCISING ANY OTHER RIGHTS AND REMEDIES AVAILABLE TO LESSOR.

LESSOR’S INITIALS:

LESSEE’S INITIALS:

3.4Net Lease. This Lease is and is intended to be what is commonly referred to as a “net, net, net” or “triple net” lease. The Rent shall be paid absolutely net to Lessor, so that this Lease shall yield to Lessor the full amount or benefit (as applicable), of the installments of Minimum Rent and Additional Charges throughout the Term.

3.5Personal Property. Lessor and Lessee agree that the fair market value of Lessor’s Personal Property leased hereunder at each Facility does not exceed fifteen percent (15%) of the total fair market value of all of the property leased hereunder at the Facility (including real property, improvements, fixtures and personal property).

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ARTICLE IV.

4.1Impositions.

4.1.1Subject to Article XII regarding permitted contests, Lessee shall pay, or cause to be paid, all Impositions before any fine, penalty, interest or cost is added for nonpayment. Lessee shall make such payments directly to the taxing authorities where feasible, and promptly furnish to Lessor copies of official receipts or other satisfactory proof evidencing such payments. Subject to Article XII regarding permitted contests, Lessee’s obligation to pay Impositions shall be absolutely fixed upon the date such Impositions become a lien upon the Leased Property, any Capital Additions or any part(s)thereof. If any Imposition may, at the option of the taxpayer, lawfully be paid in installments, whether or not interest shall accrue on the unpaid balance of such Imposition, Lessee may pay the same, and any accrued interest on the unpaid balance of such Imposition, in installments as the same respectively become due and before any fine, penalty, premium, further interest or cost may be added thereto.

4.1.2Lessor shall prepare and file all tax returns, extensions and reports in compliance with all material Legal Requirements with respect to Lessor’s net income, gross receipts, franchise taxes and taxes on its capital stock; provided, that if Lessee would have any liability for such taxes, as Impositions or otherwise, Lessor shall submit the relevant returns, extensions and/or reports to Lessee at least ten (10)days prior to the due date for such returns, extensions and/or reports. Lessee shall prepare and file all other tax returns and reports as may be required by Legal Requirements with respect to or relating to the Leased Property, all Capital Additions, Lessee’s Personal Property and Intangible Property. Any refund due from any taxing authority in respect of any Imposition paid by Lessee shall be paid over to or retained by Lessee for so long as no Event of Default shall have occurred hereunder and be continuing. For so long as no Event of Default shall have occurred hereunder and be continuing, any refund shall be paid over to or retained by Lessor and applied to the payment of Lessee’s obligations under this Lease in such order of priority as Lessor shall determine.

4.1.3Lessor and Lessee shall, upon request of the other, provide such data as is maintained by the party to whom the request is made with respect to the Leased Property and all Capital Additions as may be necessary to prepare any required returns and reports. If any property covered by this Lease is classified as personal property for tax purposes, Lessee, to the extent required to comply with Legal Requirements, shall file all personal property tax returns in such jurisdictions in compliance with all material Legal Requirements. Lessor, to the extent it possesses the same, and Lessee, to the extent it possesses the same, shall provide the other party, upon request, with cost and depreciation records necessary for filing returns for any property so classified as personal property. Where Lessor is legally required to file personal property tax returns and to the extent practicable, Lessee shall be provided with copies of assessment notices indicating a value in excess of the reported value in sufficient time for Lessee to file a protest.

4.1.4Lessee may, upon notice to Lessor, at Lessee’s option and at Lessee’s sole cost and expense, protest, appeal, or institute such other proceedings as Lessee maydeem appropriate to effect a reduction of real estate or personal property assessments and Lessor, at Lessee’s expense as aforesaid, shall reasonably cooperate with Lessee in such protest, appeal, or other action but at no cost or expense to Lessor. Xxxxxxxx for reimbursement by Lessee to Lessor of personal property or real property taxes shall be accompanied by copies of a xxxx therefor and payments thereof which identify the personal property or real property with respect to which such payments are made.

4.1.5Lessor shall give prompt notice to Lessee of all Impositions payable by Lessee hereunder of which Lessor has knowledge (including, without limitation, those in respect of which Lessor has received written notice), but Lessor’s failure to give any such notice shall in no way diminish Lessee’s obligations hereunder to pay such Impositions.

4.1.6Impositions imposed or assessed in respect of the tax-fiscal period during which the Term terminates with respect to any Facility shall be adjusted and prorated between Lessor and Lessee with respect to such Facility, whether or not such Imposition is imposed or assessed before or after such termination, and Lessee’s obligation to pay its prorated share thereof shall survive such termination with respect to such Facility.

4.2Utility Charges. Lessee shall pay or cause to be paid all charges for electricity, power, gas, oil, water and other utilities used in the Leased Property and all Capital Additions. Lessee shall also pay or reimburse Lessor for all out-of-pocket costs and expenses of any kind whatsoever which at any time with respect to the Term hereof may be imposed against Lessor by reason of any of the covenants, conditions and/or restrictions affecting the Leased Property, any Capital Additions and/or any part(s)thereof, or with respect to easements, licenses or other rights over, across or with respect to any adjacent or other property which benefits the Leased Property and/or any Capital Additions, including any and all out-of-pocket costs and expenses associated with any utility, drainage and parking easements.

4.3Insurance Premiums. Lessee shall pay or cause to be paid all premiums for the insurance coverage required to be maintained by Lessee hereunder.

4.4Impound Accounts.

4.4.1Upon the occurrence and during the continuance of a Real Estate Tax Impound Account Trigger Event, Lessee shall deposit, at the time of any payment of Minimum Rent, an amount equal to one-twelfth (1/12th) of Lessee’s estimated annual Impositions relating to real estate taxes, of every kind and nature, required

pursuant to Section 4.1 in a segregated, interest bearing tax impound account as directed by Lessor. Such amounts shall be applied to the payment of the obligations in respect of which said amounts were deposited in such order or priority as Lessor shall determine, on or before the respective dates on which the same or any of them would become delinquent. Nothing in this Section 4.4.1 shall be deemed to affect any other right or remedy of Lessor hereunder.

4.4.2Upon the occurrence and during the continuance of an Insurance Premium Impound Account Trigger Event, Lessee shall deposit at the time of any payment of Minimum Rent, an amount equal to one-twelfth (1/12th) of Lessee’s estimated annual insurance premiums required pursuant to Section 4.3 in a segregated, interest bearing insuranceimpound account as directed by Lessor. Such amounts shall be applied to the payment of the obligations in respect of which said amounts were deposited in such order or priority as Lessor shall determine, on or before the respective dates on which the same or any of them would become delinquent. Nothing in this Section 4.4.2 shall be deemed to affect any other right or remedy of Lessor hereunder.

4.4.3No amount deposited with Lessor or into an impound account established pursuant to this Section 4.4 shall be or be deemed to be escrow or trust funds, provided that all amounts deposited with Lessor shall be held in segregated, interest-bearing accounts as designated by and under the control of Lessor. Lessee shall be entitled to have interest earned on funds deposited into an impound account established pursuant to this Section 4.4 (but Lessor shall have no obligation to provide any specified rate of return and shall have no liability to Lessee with respect to the amount of any such interest earned on such deposits). Any amounts deposited with Lessor or contained in any impound account established pursuant to this Section 4.4 shall be solely for the protection of Lessor and the Leased Property and entail no responsibility on Lessor’s part beyond the timely application of such amounts as provided above. The cost of administering any impound accounts shall be paid by Lessee. In the event of a transfer of Lessor’s interest in the Leased Property of any Facility or an assignment of Lessor’s interest in this Lease with respect to any Facility, Lessor shall transfer to the transferee the amounts deposited by Lessee in any impound account established by Lessor pursuant to this Section 4.4 with respect to such Facility and thereupon shall, without any further agreement between the parties, be released by Lessee from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of such amounts to such a transferee/assignee. The amounts deposited by Lessee (or by a transferee of Lessor’s interest, as described above) in any impound account established by Lessor pursuant to this Section 4.4 may also be assigned as security in connection with a Facility Mortgage, provided that the same shall be subject to the terms of any applicable subordination and non-disturbance agreement entered into between Lessee and the applicable Facility Mortgagee. Nothing contained in this Section 4.4.3 shall be deemed to affect any other right or remedy of Lessor hereunder.

4.5Tax Service. During the Term, to the extent in Lessee’s possession, Lessee shall provide Lessor with copies of reports provided by a third party tax reporting service or consultant monitoring the timely payment of Impositions by Lessee under this Lease promptly upon Lessor’s request for such reports, but in no event more frequently than quarterly. Notwithstanding the foregoing, Lessor shall retain the right at any time during the Term, at its election and expense, to separately engage a third party tax reporting service or consultant for the purpose of monitoring the timely payment of Impositions by Lessee under this Lease and Lessee shall reasonably cooperate with Lessor and any such a third party tax reporting service or consultant engaged by Lessor

ARTICLE V.

5.1No Termination, Abatement, etc. Except as otherwise specifically provided in this Lease, Lessee shall remain bound by this Lease in accordance with its terms and shall not seek or be entitled to any abatement, deduction, deferment or reduction of Rent, or set-off against the Rent. Except as otherwise specifically provided in this Lease, the respective obligations of Lessor and Lessee shall not be affected by reason of (i) any damage to ordestruction of the Leased Property, any Capital Additions and/or any part(s)thereof from whatever cause and/or any Condemnation of the Leased Property, any Capital Additions and/or any part(s)thereof; (ii) the lawful or unlawful prohibition of, or restriction upon, Lessee’s use of the Leased Property, any Capital Additions and/or any part(s)thereof, or the interference with such use by any Person (other than Lessor in contravention of this Lease) or by reason of eviction by paramount title; (iii) any claim that Lessee has or might have against Lessor by reason of any default or breach of any warranty by Lessor hereunder or under any other agreement between Lessor and Lessee or to which Lessor and Lessee are parties (except, and then only to the extent that, Lessor’s actions materially and adversely impair Lessee’s use or operation of a Facility in contravention of this Lease); (iv) any bankruptcy, insolvency, reorganization, composition, readjustment, liquidation, dissolution, winding up or other proceedings affecting Lessor or any assignee or transferee of Lessor; or (v) for any other cause, whether similar or dissimilar to any of the foregoing, other than a discharge of Lessee from any such obligations as a matter of law. Lessee hereby specifically waives all rights arising from any occurrence whatsoever which may now or hereafter be conferred upon it by law (a) to modify, surrender or terminate this Lease or quit or surrender the Leased Property, any Capital Additions and/or any part(s)thereof; or (b) which may entitle Lessee to any abatement, reduction, suspension or deferment of the Rent or other sums payable by Lessee hereunder, except as otherwise specifically provided in this Lease. The obligations of Lessor and Lessee hereunder shall be separate and independent covenants and agreements and the Rent and all other sums payable by Lessee hereunder shall continue to be payable in all events unless the obligations to pay the same shall be terminated pursuant to the express provisions of this Lease or by termination of this Lease other than by reason of an Event of Default.

5.2Termination with Respect to Fewer than All of the Facilities. Wherever in this Lease the action of terminating the Lease with respect to any Facility (or action of similar import) is discussed, such action shall mean the termination of Lessee’s rights in and to the Leased Property relating to such Facility. Notwithstanding anything in this Lease to the contrary, if this Lease shall expire or be terminated by Lessor or Lessee with respect to any Facility in accordance with the terms and provisions of this Lease, such expiration or termination shall not affect the applicable Term of this Lease with respect to the balance of the Facilities not so expiring or being terminated, and this Lease shall continue in full force and effect with respect to each other such Facility, except that the total Minimum Rent

payable hereunder shall (except as otherwise expressly provided in Section 3.1.4(c)) be reduced by the amount of Allocated Minimum Rent with respect to such Facility as to which this Lease has so expired or been terminated. Nothing contained in this Section 5.2 shall serve in any way (a) to limit Lessor’s ability, pursuant to and solely in accordance with Section 16.2 below, to terminate this Lease with respect to any or all of the Facilities if an Event of Default shall have occurred under this Lease, regardless of whether such Event of Default emanated primarily from a single Facility, or (b) in the event of a termination because of an Event of Default, to recover damages or otherwise exercise its remedies with respect to such Facility(ies) as provided in Article XVI.

ARTICLE VI.

6.1Ownership of the Leased Property. Lessee acknowledges that the Leased Property is the property of Lessor and that Lessee has the right to the exclusive possession anduse of the Leased Property only upon the terms and conditions of this Lease. Upon the expiration or earlier termination of this Lease with respect to any Facility, Lessee shall, at its expense, repair and restore the Leased Property relating to such Facility to the condition required by Section 9.1.4.

6.2Personal Property. During the Term, Lessee shall, as necessary to operate and maintain each Facility in accordance with all material terms of this Lease, and at its expense, install, affix or assemble or place on any parcels of the Land or in any of the Leased Improvements, any items of Lessee’s Personal Property and replacements thereof which shall be the property of and owned by Lessee. Except as provided in Sections 6.3 and 16.9, Lessor shall have no rights to Lessee’s Personal Property or Intangible Property. With respect to each Facility, Lessee shall provide and maintain during the entire Term applicable to such Facility all Personal Property necessary in order to operate such Facility (i) in compliance with all Required Governmental Approvals, and (ii) in material compliance with all Legal Requirements and all Insurance Requirements and otherwise in accordance with customary practice in the industry for the Primary Intended Use. In addition, Lessee shall (at its own expense and subject to the immediately preceding sentence) be permitted to replace, modify, alter or substitute any of Lessor’s Personal Property that has become obsolete or worn out with personal property of equal or better quality. Any such replacements, modifications, alterations or substitutions (whether or not upgrades thereof) shall become Lessor’s Personal Property.

6.3Transfer of Personal Property and Capital Additions to Lessor. Upon the expiration or earlier termination of this Lease with respect to any Facility (unless such termination is the result of Lessee’s purchase of such Facility), all Capital Additions not owned by Lessor shall become the property of Lessor, free of any encumbrance, and all or any portion of Lessee’s Personal Property (including motor vehicles used to transport residents/patients, but excluding, for the avoidance of doubt, Lessee’s Intangible Property) relating to such Facility shall, if so elected by Lessor, become the property of Lessor, free of any encumbrance, and Lessee shall execute all documents and take any actions reasonably necessary to evidence such ownership and discharge any encumbrance thereon; provided that the foregoing shall not derogate from the provisions of Section 45.1.4. If Lessor does not so elect to acquire any portion of the Lessee’s Personal Property, Lessee shall remove any such items of Lessee’s Personal Property that Lessor has not so elected to acquire upon such expiration or earlier termination of this Lease. Notwithstanding the foregoing or anything to the contrary in this Lease, upon the expiration or earlier termination of this Lease with respect to any Facility, Lessor shall not be obligated to reimburse Lessee for any replacements, rebuildings, alterations, additions, substitutions, and/or improvements that are surrendered as part of or with the Leased Property or Capital Additions of such Facility. For purposes of this Section 6.3 only, “Lessee’s Personal Property” shall not include any Lessee’s IP Intangibles.

ARTICLE VII.

7.1Condition of the Leased Property. Lessee acknowledges receipt and delivery of possession of the Leased Property and confirms that Lessee has examined and otherwise has knowledge of the condition of the Leased Property prior to the execution and delivery of this Lease. Regardless, however, of any examination or inspection made by Lesseeand whether or not any patent or latent defect or condition was revealed or discovered thereby, Lessee is leasing the Leased Property “AS IS” in its present condition. Lessee waives any claim or action against Lessor in respect of the condition of the Leased Property including any defects or adverse conditions not discovered or otherwise known by Lessee as of the date hereof. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, LESSOR MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED,IN RESPECT OF THE LEASED PROPERTY OR ANY PARTTHEREOF, EITHER AS TO ITS TITLE, FITNESS FOR USE, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE OR OTHERWISE, OR AS TO THE NATURE OR QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, OR THE EXISTENCE OF ANY HAZARDOUS SUBSTANCE, MOLD OR MOLD CONDITION,IT BEING AGREED THAT ALL SUCH RISKS, LATENT OR PATENT, ARE TO BE BORNE SOLELY BY LESSEE INCLUDING ALL RESPONSIBILITY AND LIABILITY FOR ANY (I)ENVIRONMENTAL REMEDIATION AND COMPLIANCE WITH ALL ENVIRONMENTAL LAWS AND (II)MOLD REMEDIATION AND COMPLIANCE WITH ALL MOLD REMEDIATION REQUIREMENTS.

7.2Use of the Leased Property.

7.2.1Lessee covenants that it will obtain and maintain (or, in the case of any Facility in respect of which a Master Sublease or management agreement permitted without Lessor’s consent under Sections 24.1.1 and 24.1.12 is in effect between Lessee and any of its Affiliates, cause such Affiliate to obtain and maintain) all Required Governmental Approvals with respect to each Facility (including for any Capital Additions to such Facility).

7.2.2Lessee shall use or cause to be used the Leased Property, all Capital Additions and the improvements thereon of each Facility only for the Primary Intended Use of such Facility and for no other uses, except for areas reasonably required for office, storage space or ancillary service uses incidental to the Primary Intended Use. No change to the Primary Intended Use of any Facility shall be permitted hereunder without the prior written consent of Lessor, which consent may be granted or withheld in Lessor’s reasonable discretion.

7.2.3Subject to any reasonable interruptions in operations as a result of (i) casualty or condemnation and the restoration thereof in accordance with the applicable provisions of Article XIV and/or Article XV hereof, or (ii) the remediation of any environmental condition in accordance with the applicable provisions of Section 37.3 hereof, Lessee shall operate continuously the entire Leased Property and all Capital Additions of each Facility in accordance with the Primary Intended Use of such Facility. Lessee shall devote the entirety of each Facility and all Capital Additions thereto to the Primary Intended Use, except for areas reasonably required for office, storage space or ancillary service uses incidental to the Primary Intended Use. Lessee shall not modify the services offered or, except as permitted in Section 7.4 hereof, take any other action (e.g., removing patients or residents from any Facility or directing patients or residents, or prospective patients or residents, to another facility) which would materially reduce Gross Revenues or the Fair Market Value of any Facility.

7.2.4Lessee shall conduct its business at each Facility in conformity with standards that meet or exceed the standards of such Facility’s operations as of theCommencement Date and in a manner consistent with normal and customary standards of patient or resident care practice (as the same may change from time to time during the Term) provided in similar facilities in the State.

7.2.5Lessee shall not commit any physical waste on the Leased Property and/or on or to any Capital Additions.

7.2.6Lessee shall not permit the Leased Property, any Capital Additions, or any part(s)thereof, or Lessee’s Personal Property, to be used in such a manner as (i) is reasonably likely to impair Lessor’s title thereto or to any portion thereof or (ii) may make reasonably likely a claim of adverse use or possession, or an implied dedication of the Leased Property, any Capital Additions or any part(s)thereof.

7.3Lessor to Grant Easements, Etc. Lessor shall, from time to time so long as no Event of Default has occurred and is continuing, at the request of Lessee and at no cost or expense to Lessor, but subject to the approval of Lessor, which approval shall not be unreasonably withheld, conditioned or delayed, (i) grant easements and other rights in the nature of easements; (ii) release existing easements or other rights in the nature of easements which are for the benefit of the Leased Property; (iii) dedicate or transfer unimproved portions of the Leased Property for road, highway or other public purposes; (iv) execute petitions to have the Leased Property annexed to any municipal corporation or utility district; (v) execute amendments to any covenants, conditions and restrictions affecting the Leased Property; and (vi) execute and deliver to any Person any instrument appropriate to confirm or effect such grants, releases, dedications and transfers to the extent of its interest in the Leased Property, but only upon delivery to Lessor of an Officer’s Certificate stating that such grant release, dedication, transfer, petition or amendment is either reasonably necessary for the use, maintenance and/or operation of the Leased Property or would not be detrimental to the proper conduct of the Lessee’s business and, in each case, would not be reasonably expected to materially reduce the value of the Leased Property.

7.4Preservation of Facility Value. Lessee acknowledges that a fair return to Lessor on its investment in the Leased Property is dependent, in part, on the concentration during the Term of, as applicable, the senior housing businesses of the Lessee Parties in the geographical area of the Leased Property. Lessee further acknowledges that diversion of residents and/or patients, as applicable, from any Facility to other facilities and/or reemployment by Lessee of management or supervisory personnel working at any Facility following the expiration or earlier termination of this Lease at other facilities owned, operated or managed, whether directly or indirectly, by the Lessee Parties could reasonably be expected to have a material adverse impact on the value and utility of the Leased Property and all Capital Additions. Lessor and Lessee agree as follows:

7.4.1Unless approved by Lessor in its sole and absolute discretion, Lessee shall not, and shall not permit any of its Affiliates to, participate directly or indirectly, at any time during the Term (other than the [***] of the Term, which shall be governed by Section 7.4.2), in the de novo development or construction of any Competing Community;provided, however, that the foregoing prohibition shall not be deemed to restrict any expansion, repositioning or redevelopment of (i) any Competing Community identified on Schedule 7.4.1 hereto or (ii) any Competing Community in which Lessee or any of its Affiliates acquires any fee, leasehold, management or other interest (provided that Lessee or its Affiliate(s)shall have first notified Lessor in writing of its or its Affiliate’s intentions to so acquire such fee, leasehold, management or other interest in such Competing Community).

Portions of this exhibit that have been marked by [***] have been omitted pursuant to a request for confidential treatment filed separately with the Securities and Exchange Commission.

7.4.2During the [***] of the Term (as such period may change following any extension of the Term permitted by the terms of this Lease from time to time, the “Restriction Period”), none of the Lessee Parties, directly or indirectly, shall acquire the operation, ownership, management or any ownership interest in any Competing Community providing services or goods similar to those provided in connection with any Facility and its Permitted Intended Use. Notwithstanding the foregoing, this Section 7.4.2 shall not be deemed violated (i) with respect to any such Competing Community owned, leased, operated or managed by Brookdale or its Affiliates, or in which any of Brookdale or its Affiliates has any ownership interest, as of the commencement of the applicable Restriction Period, (ii) with respect to such Competing Communities owned, leased, operated or managed by Lessor or any Affiliate of Lessor that are transferred by Lessor or any Affiliate of Lessor to any Lessee Party from time to time, and/or (iii) if any Lessee Party’s interest in any such Competing Community shall arise by virtue of any Lessee Party’s acquisition during the Restriction Period of the operation, ownership, management or other ownership interest in a portfolio, directly or indirectly, by operation of law or otherwise, and less than [***] of the facilities in such portfolio are Competing Communities providing services or goods similar to those provided in connection with any Facility and its Permitted Intended Use (such acquisition, a “Portfolio Acquisition”). In the event that any Lessee Party consummates a Portfolio Acquisition during the Restriction Period (as modified pursuant to the terms hereof), Lessee shall give notice thereof to Lessor within five (5)Business Days after the date on which such Portfolio Acquisition is consummated. Within thirty (30) days after receipt of such notice, Lessor may request that the applicable Lessee Party sell, dispose of or cease to manage, or transfer the management of, as applicable, any Competing Community providing services or goods similar to those provided in connection with any Facility and its Permitted Intended Use which is acquired during the Restriction Period as part of the Portfolio Acquisition, to a non-Affiliate of such Lessee Party (each, a “Disposition Request”) within one hundred twenty (120) days of the consummation of the Portfolio Acquisition (the “Outside Disposition Date”) (provided Lessor’s failure to make such written request within such thirty (30) day period with respect to such Competing Community(ies) shall be deemed a waiver by it of Lessor’s right to make such request with respect to such Competing Community(ies)). If Lessee fails to notify Lessor of a Portfolio Acquisition within the five (5)Business Day period described above, Lessor shall be deemed to have made a Disposition Request with respect to each Competing Community (providing services or goods similar to those provided in connection with any Facility and its Permitted Intended Use) which is acquired during the Restriction Period as part of such Portfolio Acquisition. In the event that the applicable Lessee Party fails to sell, dispose of or cease to manage, or transfer the management of, such Competing Community or Competing Communities as requested (or deemed requested) by Lessor, then unless and until such Lessee Party sells, disposes of or ceases to manage, or transfers the management of, as requested (ordeemed requested) by Lessor, such Competing Community or Competing Communities to a non-Affiliate of such Lessee Party, commencing on the Outside Disposition Date, Lessee shall pay to Lessor each month as an Additional Charge under this Lease (in addition to Minimum Rent and all other Additional Charges payable hereunder) an amount equal to (x) during the [***] of the Term, [***] of the gross revenue of such Competing Community or Competing Communities for such month, (y) during the [***] of the Term, [***] of the gross revenue of such Competing Community or Competing Communities for such month, and (z) during the [***] of the Term, [***] of the gross revenue of such Competing Community or Competing Communities for such month, in each case calculated as if each such Competing Community were a Facility. Notwithstanding the foregoing, (1) the failure of any Lessee Party to dispose of any Competing Community as required herein on or prior to the Outside Disposition Date shall not be or result in a default by Lessee hereunder, the parties agreeing that the sole remedy of Lessor for any such failure is set forth in this Section 7.4.2 (and that a failure by Lessee to pay any Additional Charge as required herein shall constitute a default by Lessee hereunder), (2) no Additional Charge as contemplated by this Section 7.4.2 shall be due or payable with respect to any such Competing Community after the applicable Lessee Party sells, disposes of or ceases to manage, or transfers the management of, as applicable, such Competing Community to a non-Affiliate of such Lessee Party, and (3) Lessee, in its sole discretion, may notify Lessor of any intended Portfolio Acquisition which may occur during the Restriction Period prior to the consummation thereof and, in such event, (A) Lessor shall notify Lessee within thirty (30) days after receipt of such notice of any Disposition Request (provided Lessor’s failure to make such written request within such thirty (30) day period shall be deemed a waiver by it of Lessor’s right to make such request with respect to such Competing Community(ies)) and (B) subject to the terms (including the last sentence) of this Section 7.4.2, the applicable Lessee Party shall be required to dispose of the applicable Competing Community to a non-Affiliate of such Lessee Party prior to the Outside Disposition Date, if a Disposition Request is timely made by Lessor (or, if not disposed of as aforesaid, to pay the amounts set forth above as Additional Charges until such Competing Community is disposed of as aforesaid).

Portions of this exhibit that have been marked by [***] have been omitted pursuant to a request for confidential treatment filed separately with the Securities and Exchange Commission.

The parties hereto agree that if Lessee elects to extend the Term of this Lease, upon the exercise of such extension right, the “Restriction Period” contemplated by this Section 7.4.2 shall be automatically modified accordingly to reflect the new Extended Term, and the operating restrictions and any payment obligations required under this Section 7.4.2 shall cease, and no operating restrictions and/or payment obligations under this Section 7.4.2 shall apply except as set forth herein during the next Restriction Period (that is, the [***] of the Term, as extended).

7.4.3Notwithstanding any provision of this Lease to the contrary, in the event that counsel or independent accountants for Lessor determine that there exists a material risk that any amounts due to Lessor under Section 7.4.2 would be treated as gross income for purposes of section 856 of the Code that is not described in section 856(c)(2)or 856(c)(3)of the Code, as applicable (such gross income, “Nonqualifying Income”) to Lessor (or its direct or indirect owner that is a REIT), the amount paid to Lessor pursuant to this Agreement in any taxable year of Lessor shall not exceed the maximum amount that can be paid to Lessor in such year without causing Lessor (or its direct or indirect owner that is a REIT) to fail to meet the requirements applicable to REITs under the Code (the “REIT Requirements”) for such year, determined as if the payment of such amount were Nonqualifying Income. If the amountpayable for any taxable year of Lessor under the preceding sentence is less than the amount that otherwise would be payable to Lessor pursuant to this Lease (the amount of such deficit, the “Expense Amount”), then: (A) Lessor shall deposit such Expense Amount in escrow with an escrow agent mutually satisfactory to Lessor and Lessee under an escrow agreement conforming to the terms of this paragraph; and (B) Lessor shall not be entitled to any such Expense Amount, unless and until Lessor delivers to the escrow agent, at the sole option of Lessor, (i) an opinion of Lessor’s tax counsel to the effect that such amount, if and to the extent paid, would not constitute Nonqualifying Income, (ii) a letter from Lessor’s independent accountants indicating the maximum amount that can be paid at that time to Lessor without causing Lessor (or its direct or indirect owner that is a REIT) to fail to meet the REIT Requirements for any relevant taxable year, in which case Lessor shall be paid such maximum amount, or (iii) a private letter ruling issued by the Internal Revenue Service indicating that the receipt of any Expense Amount hereunder will not cause Lessor (or its direct or indirect owner that is a REIT) to fail to satisfy the REIT Requirements. Lessee’s and escrow holder’s obligation to pay any Expense Amounts shall terminate ten (10)years from the date of this Agreement and, upon such date, the escrow holder shall remit any remaining funds in escrow to Lessee and Lessee shall have no obligation to make any further payments to Lessor with respect to such Expense Amounts notwithstanding that such Expense Amounts have not been paid as of such date. For all purposes of this Lease, (i) Lessor releases Lessee from any claims that may arise from actions taken by Lessee at the request of Lessor or its agent under this Section 7.4.3, and (ii) Lessor’s right to receive Expense Amounts shall be limited to the amounts in escrow and Lessee shall have no obligation to make any further payments to Lessor with respect to such Expense Amounts.

7.4.4Except (a) to provide residents or patients with an alternative level of care not available at a Facility, (b) as the result of the failure of the applicable resident or patient to pay Lessee for his or her stay at a Facility, (c) to ensure the health and welfare of any residents or patients of a Facility, or (d) in response to an unsolicited request by the resident or his/her family or caregiver for a recommendation for alternative facilities, at any time during the [***] of the applicable Initial Term and of any Extended Terms (the parties agreeing that following delivery of notice of the exercise of any Term extension by Lessee pursuant to the terms of this Lease, for the purposes of this Section 7.4.4, the Term of this Lease shall be deemed to have been extended, and the terms of this Section 7.4.4 shall be interpreted accordingly) with respect to any or all of the Facilities, Lessee shall not, without the prior written consent of Lessor, which consent may be given or withheld in Lessor’s reasonable discretion, recommend or solicit the removal or transfer of more than [***] of the total residents or patients at any Facility during the applicable [***] period to any other facility (including any other Facility that is subject to this Lease). At any time during the [***] of the applicable Initial Term and of any Extended Terms (the parties agreeing that following delivery of notice of the exercise of any Term extension by Lessee pursuant to the terms of this Lease, for the purposes of this Section 7.4.4, the Term of this Lease shall be deemed to have been extended, and the terms of this Section 7.4.4 shall be interpreted accordingly), Lessee shall not recommend or solicit the transfer of any executive director or sales and marketing director of any Facility to any other facility (including any other Facility that is subject to this Lease) unless such transfer (i) is in the ordinary course of business and consistent with Lessee’s and its Affiliates’ past practices and (ii) does not materially affect such Facility. For avoidance of doubt, the foregoing restrictions inthis Section 7.4.4 shall not apply to transfers requested by such patient (or his/her family or caregiver), executive director or sales and marketing director, as the case may be, without the recommendation or solicitation of Lessee or its Affiliates.

Portions of this exhibit that have been marked by [***] have been omitted pursuant to a request for confidential treatment filed separately with the Securities and Exchange Commission.

ARTICLE VIII.

8.1Compliance with Legal and Insurance Requirements, Instruments, Etc. Subject to Article XII regarding permitted contests, Lessee, at no expense to Lessor, shall promptly (i) comply with all material Legal Requirements and material Insurance Requirements regarding the use, operation, maintenance, repair and restoration of the Leased Property, Lessee’s Personal Property,Intangible Property and all Capital Additions whether or not compliance therewith may require structural changes in any of the Leased Improvements or any Capital Additions or interfere with the use and enjoyment of the Leased Property and (ii) procure and maintain (or, in the case of any Facility in respect of which a Master Sublease or management agreement permitted without Lessor’s consent under Sections 24.1.1 and 24.1.12 is in effect between Lessee and any of its Affiliates, cause such Affiliate to obtain and maintain) and comply with (and cause any such Affiliate to comply with) all Required Governmental Approvals. At any time following the occurrence and during the continuance of an Event of Default, Lessor may, but shall not be obligated to, enter upon the Leased Property and all Capital Additions and take such actions and incur such costs and expenses to effect such compliance as it deems advisable (exercising its commercially reasonable judgment) to protect its interest in the Leased Property and all Capital Additions, and Lessee shall reimburse Lessor for all such costs and expenses so incurred by Lessor in connection with such actions. Lessee covenants and agrees that the Leased Property, Lessee’s Personal Property,Intangible Property and all Capital Additions shall not be used for any unlawful purpose.

ARTICLE IX.

9.1Maintenance and Repair.

9.1.1Lessee shall, at no expense to Lessor, maintain the Leased Property, and every portion thereof, Lessee’s Personal Property and all Capital Additions, and all private roadways, sidewalks and curbs appurtenant to the Leased Property, and which are under Lessee’s control in good order and repair (to the extent necessary to maintain continued operation of the same in a manner consistent with the standard set forth in Section7.2.4) whether or not the need for such repairs occurs as a result of Lessee’s use, any prior use, the elements or the age of the Leased Property, Lessee’s Personal Property and all Capital Additions, and, with reasonable promptness, Lessee shall make or cause to be made all necessary and appropriate repairs thereto of every kind and nature, including those necessary to comply with changes in any material Legal Requirements, subject to Article XII regarding permitted contests, whether interior or exterior, structural or non-structural, ordinary or extraordinary, foreseen or unforeseen or arising by reason of a condition existing prior to the Commencement Date. All repairs shall be at least equivalent in quality to the original work. Lessee will not take any action the taking of which would reasonably be expected to materially impair the value or the usefulness of the Leased Property, any Capital Additions, or any part(s)thereof for continued operation thereof, in a manner consistent with the standard set forth in Section7.2.4, for the Primary Intended Use.

9.1.2Lessor shall not under any circumstances be required to (i) build or rebuild any improvements on the Leased Property or any Capital Additions; (ii) make any repairs, replacements, alterations, restorations or renewals of any nature to the Leased Property, whether ordinary or extraordinary, structural or non-structural, foreseen or unforeseen, or to make any expenditure whatsoever with respect thereto; or (iii) maintain the Leased Property or any Capital Additions in any way. Lessee hereby waives, to the extent permitted by law, the right to make repairs at the expense of Lessor pursuant to any law in effect at the time of the execution of this Lease or hereafter enacted.

9.1.3Nothing contained in this Lease and no action or inaction by Lessor shall be construed as (i) constituting the consent or request of Lessor, expressed or implied, to any contractor, subcontractor, laborer, materialman or vendor to or for the performance of any labor or services or the furnishing of any materials or other property for the construction, alteration, addition, repair or demolition of or to the Leased Property, any Capital Additions or any part(s)thereof; or (ii) giving Lessee any right, power or permission to contract for or permit the performance of any labor or services or the furnishing of any materials or other property in such fashion as would permit the making of any claim against Lessor in respect thereof or to make any agreement that may create any right, title, interest, lien, valid claim or other encumbrance upon the estate of Lessor in the Leased Property, any Capital Additions or any part(s)thereof other than Permitted Encumbrances and inchoate mechanics liens resulting from work permitted to be done at the Leased Properties in accordance with this Lease, subject to the terms hereof with respect thereto.

9.1.4Unless Lessor shall convey any of the Leased Property to Lessee pursuant to the provisions of this Lease, Lessee shall, upon the expiration or earlier termination of the Term, vacate and surrender the Leased Property, Lessee’s Personal Property and Intangible Property (other than Lessee’s IP Intangibles) that Lessor elects to acquire, and all Capital Additions to Lessor in the condition in which the Leased Property was originally received from Lessor and such Lessee’s Personal Property and Intangible Property (other than Lessee’s IP Intangibles) and any Capital Additions were originally introduced to each Facility, except as repaired, rebuilt, restored, altered or added to as permitted or required by the provisions of this Lease and except for ordinary wear and tear, and subject to any casualty or condemnation.

9.2Encroachments, Restrictions, Mineral Leases, Etc. If any of the Leased Improvements or Capital Additions shall, at any time, encroach upon any property, street or right-of-way, or shall violate any restrictive covenant or other agreement affecting the Leased Property, any Capital Additions or any parts thereof, or shall impair the rights of others under any easement or right-of-way to which the Leased Property is subject, or the use of the Leased Property or any Capital Additions is impaired, limited or interfered with by reason of the exercise of the right of surface entry or any other provision of a lease or reservation of any oil, gas, water or other minerals (provided that nothing in this Section 9.2 shall derogate from the provisions contained in the last paragraph of Section 1.1), then promptly upon the

request of Lessor or any Person affected by any such encroachment, violation or impairment, Lessee, at its sole cost and expense, but subject to its right to contest the existence of any such encroachment, violation or impairment, shall protect, indemnify, save harmless and defend Lessor and its Affiliates from and against all losses, liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses (including reasonable attorneys’, consultants’ and experts’ fees andexpenses) based on or arising by reason of any such encroachment, violation or impairment. In the event of an adverse final determination with respect to any such encroachment, violation or impairment by a court or regulatory authority having jurisdiction with respect thereto, Lessee shall either (i) obtain valid and effective waivers or settlements of all claims, liabilities and damages resulting from each such encroachment, violation or impairment, whether the same shall affect Lessor or Lessee; or (ii) make such changes in the Leased Improvements and any Capital Addition, and take such other actions, as Lessee in the good faith exercise of its judgment deems reasonably practicable, to remove such encroachment or to end such violation or impairment, including, if necessary, the alteration of any of the Leased Improvements or any Capital Addition, and in any event take all such actions as may be necessary in order to be able to continue the operation of the Leased Improvements and any Capital Addition for the Primary Intended Use substantially in the manner and to the extent the Leased Improvements and Capital Additions were operated prior to the assertion of such encroachment, violation or impairment. Lessee’s obligations under this Section 9.2 shall be in addition to and shall in no way discharge or diminish any obligation of any insurer under any policy of title or other insurance and, to the extent the recovery thereof is not necessary to compensate Lessor for any damages incurred by any such encroachment, violation or impairment, Lessee shall be entitled to a credit for any sums recovered by Lessor under any such policy of title or other insurance.

9.3Intentionally Omitted

9.4O&M Plan.

9.4.1Lessee shall continue to maintain after the Commencement Date, any operations and maintenance plans (a “Maintenance Program”) with respect to asbestos-containing materials (each, an “ACM”), consistent with “Guidelines for Controlling Asbestos-Containing Materials in Buildings” (USEPA, 1985) and any other applicable Environmental Laws, and each such Maintenance Program will remain in effect throughout the Term with respect to each such Facility.

9.5Capital Projects Funded by Lessee.

9.5.1Without in any way limiting Lessee’s obligations under this Article IX, Lessee shall expend during each Lease Year, no less than the Annual Minimum Capital Project Amount for Capital Projects. Such Capital Projects shall be performed and completed in compliance with the applicable provisions of this Lease, including Article X. With respect to the fifth Lease Year and each Lease Year thereafter, Lessee shall furnish to Lessor: (i) not later than thirty (30) days prior to such Lease Year, a report, for Lessor’s approval (not to be unreasonably withheld, conditioned or delayed), of Capital Projects planned for each Facility for the coming Lease Year (such report, the “Annual Capital Project Plan”), which report shall set forth in reasonable detail the plans, specifications and budget for such planned Capital Projects, and (ii) promptly following the expiration of such Lease Year, reasonable documentary evidence as to the completion of all Capital Projects for such Lease Year required pursuant to this Section 9.5, together with the costs thereof. During the fifth Lease Year and each Lease Year thereafter (without limiting the other provisions of this Lease, including Article X), Lessee shall not commence any Capital Project without Lessor’s prior approval of the Annual Capital Project Plan, which approval shall not be unreasonably withheld, conditioned or delayed. IfLessee fails to expend during such Lease Year the applicable Annual Minimum Capital Project Amount for Capital Projects, then Lessee shall promptly deposit with Lessor as a repair and replacement reserve (the “Replacement Reserve”) for Capital Projects, an amount equal to (x) the Annual Minimum Capital Project Amount less (y) the sum of (i) the amounts expended by Lessee during such Lease Year on account of Capital Projects and (ii) the Annual Minimum Capital Project Amount Overage (if applicable), and, so long as Lessee otherwise maintains the Facilities in the condition required by this Lease, once such deposit has been made Lessee shall not be deemed to be in default of its obligations under this Section 9.5 for Lessee’s failure to expend during such Lease Year the applicable Annual Minimum Capital Project Amount for Capital Projects. For the avoidance of doubt, during the first four Lease Years, the Planned Capital Refurbishment Project Costs expenditure shall count toward the Annual Minimum Capital Project Amount. Notwithstanding the foregoing, Lessee shall be entitled to submit to Lessor for its approval (not to be unreasonably withheld, conditioned or delayed) amendments to the Annual Capital Project Plans.

9.5.2

(a)So long as no Event of Default or event or circumstance which with notice or passage of time, or both, would constitute an Event of Default hereunder has occurred, if (i) the Replacement Reserve has been established and (ii) Lessee expends in any Lease Year an amount in excess of the applicable Annual Minimum Capital Project Amount for Capital Projects, Lessor shall, to the extent funds are available for such purpose in such Replacement Reserve, disburse to Lessee the Capital Project Costs incurred and paid by Lessee during such Lease Year in performing such Capital Projects in excess of the applicable Annual Minimum Capital Project Amount for such Lease Year.

(b)Any such disbursement from the Replacement Reserve shall be paid by Lessor to Lessee within fifteen (15) days following: (i) receipt by Lessor of a written request from Lessee for disbursement from the Replacement Reserve; and (ii) receipt by Lessor of an Officer’s Certificate certifying that (1) the applicable item of Capital Project has been completed and verifying the cost paid or incurred by Lessee for such item of Capital Project (together with such additional evidence of the completion thereof and payment therefor as Lessor may reasonably request), (2) Lessee has received lien waivers from all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens with respect to not less than eighty-five percent (85%) of the work

related to such applicable item of Capital Project, and (3) Lessee has expended in the applicable Lease Year an amount in excess of the applicable Annual Minimum Capital Project Amount for Capital Projects. Lessor shall not be required to make advances from the Replacement Reserve more frequently than once in any thirty (30) day period.

9.5.3No funds in the Replacement Reserve shall be (or be deemed to be) escrow or trust funds, but, all funds delivered by Lessee pursuant to this Section 9.5 shall be held by Lessor in a segregated, interest-bearing account designated and controlled by Lessor. Lessee shall be entitled to have interest earned on funds deposited into the Replacement Reserve established pursuant to this Section 9.5 (but Lessor shall have no obligation to provide any specified rate of return and shall have no liability to Lessee with respect to the amount of any such interest earned on such deposits). The Replacement Reserves are solely for the protectionof Lessor and the Leased Property of the Facilities and entail no responsibility on Lessor’s part beyond the payment of the respective items for which they are held following receipt of bills, invoices or statements therefor in accordance with the terms of this Section 9.5 and beyond the allowing of due credit for the sums actually received. Upon assignment of this Lease by Lessor, any funds in the Replacement Reserve shall be turned over to the assignee and any responsibility of Lessor, as assignor, with respect thereto shall terminate. The amounts deposited by Lessee with Lessor in the Replacement Reserve may also be assigned as security in connection with a Facility, provided that the right to use or apply any funds on deposit in a Replacement Reserve shall be subject to the terms of any applicable subordination and non-disturbance agreement entered into between Lessee and the applicable Facility Mortgagee.

9.5.4If any funds remain in the Replacement Reserve upon the expiration or earlier termination of this Lease (other than as a result of the purchase of the Leased Property of a Facility by Lessee, in which case a prorated amount of such funds as determined by the number of units in such Facility in the Replacement Reserve shall be remitted by Lessor to Lessee upon the closing of such purchase or offset against the purchase price payable by Lessee for the Leased Property of such Facility), then the funds held in such Replacement Reserve shall be paid over to Lessor as an Additional Charge and Rent under this Lease for purposes of making necessary repairs to such Facilities and shall be in addition to Minimum Rent and all other Additional Charges payable hereunder.

9.6Intentionally Omitted.

9.7Inspections; Due Diligence Fee.

(a)Without limiting Lessor’s rights pursuant to Section 26.1 hereof, at any reasonable time during the Term during normal business hours and on reasonable advance notice, and upon the expiration or any earlier termination of this Lease, Lessor and its agents shall have the right to inspect the Leased Property of any Facility and all systems contained therein to determine Lessee’s compliance with its obligations under this Lease. In connection with any such inspection, Lessor shall endeavor to mitigate any interference with normal operations at the Facility.

(b)Upon the occurrence and during the continuation of an Event of Default, Lessee shall reimburse to Lessor, as an Additional Charge under this Lease, all reasonable out-of-pocket costs and expenses incurred by Lessor in connection with an any inspection of the Leased Property of any Facility performed by Lessor as provided for in paragraph (a)above promptly following Lessee’s receipt of Lessor’s invoice therefor. All other inspections pursuant to paragraph (a)above shall be at Lessor’s sole cost and expense.

(c)No inspection by Lessor or failure by Lessor following an inspection to discover any non-compliance by Lessee with respect to Lessee’s obligations under this Lease shall be deemed or construed to estop Lessor or to be a waiver by Lessor from requiring full compliance by Lessee of Lessee’s obligations hereunder.

9.8Capital Projects Funded by Lessor.

9.8.1Nature of Planned Capital Refurbishment Projects. Lessor and Lessee acknowledge and agree that the Facilities are currently in need of Capital Projects (anysuch Capital Project which may be undertaken by Lessee during any of the first four (4)Lease Years and which will be deemed to be owned by Lessor pursuant to GAAP, a “Planned Capital Refurbishment Project”), and Lessee may, but (without limiting the other provisions of this Lease, including Sections 7.2 and 9.1) is not obligated to, undertake any such Planned Capital Refurbishment Project.

9.8.2Funding of Planned Capital Refurbishment Projects Generally. Lessor shall reimburse Lessee the Planned Capital Refurbishment Project Lessor Funding Amount as provided for herein in accordance with and subject to the provisions of this Section 9.8. Lessee shall be solely responsible to perform all Planned Capital Refurbishment Project(s)it undertakes and to pay or fund all Planned Capital Refurbishment Project Costs (subject to any reimbursement obligation of Lessor expressly provided for in this Section 9.8).

9.8.3Intentionally Omitted.

9.8.4Additional Covenants and Obligations of Lessee Relating to Planned Capital Refurbishment Project(s). With respect to each Planned Capital Refurbishment Project for a Facility, Lessee covenants and agrees as follows:

(a)Lessee shall be responsible to arrange, supervise, coordinate and carry out all services necessary for the construction, performance and completion of each Planned Capital Refurbishment Project for a Facility in accordance with the Plans and Specifications therefor and this Lease, and Lessee undertakes and accepts such responsibility with the understanding that (subject to any reimbursement obligation of Lessor expressly provided for in

this Section 9.8) the Planned Capital Refurbishment Project Costs are the sole responsibility of Lessee as provided herein.

(b)From and after commencement of construction and/or performance of such Planned Capital Refurbishment Project, Lessee shall diligently prosecute the same, including punch list items, to completion in accordance with the terms of this Lease and the Plans and Specifications therefor, subject to delays in the event of the occurrence of any of the events described in Section 45.1.6.

(c)Construction/performance of such Planned Capital Refurbishment Project shall be prosecuted by Lessee in accordance with the Plans and Specifications therefor in a good and workmanlike manner and in accordance with sound building and engineering practices and all applicable Legal Requirements and all restrictive covenants affecting any Facility. All materials, fixtures or articles used in the construction/performance of such Planned Capital Refurbishment Project, or to be used in the operation thereof, shall be substantially in accordance with the Plans and Specifications therefor.

(d)If reasonably requested by Lessor upon completion of any Planned Capital Refurbishment Project at a Facility based upon the nature of such Planned Capital Refurbishment Project, Lessee shall deliver to Lessor an “as-built” set of Plans and Specifications and an ALTA “as-built” survey for such Facility.

9.8.5Disbursement of Planned Capital Refurbishment Project Lessor Funding Amount.

(a)Subject to the satisfaction by Lessee of the disbursement conditions set forth in Section 9.8.5(e)below, Lessor shall reimburse Lessee with respect to each Planned Capital Refurbishment Project for a Facility in the amount of the actual out-of-pocket Planned Capital Refurbishment Project Costs actually paid by Lessee therefor.

(b)Notwithstanding anything to the contrary in this Section 9.8, Lessor shall not be obligated to fund any sums on account of any Planned Capital Refurbishment Project for any Facility (i) when the total amount funded by Lessor pursuant to this Section 9.8 for all Facilities equals the total Planned Capital Refurbishment Project Lessor Funding Amount, or (ii) when any of the disbursement conditions set forth in Section 9.8.5(e)below have not been met or fulfilled.

(c)With respect to each Planned Capital Refurbishment Project for a Facility, all reimbursements shall be made by Lessor in accordance with a Request for Reimbursement. Each Request for Reimbursement shall be honored within twenty (20) Business Days of receipt of the same delivered in accordance with the notice provisions of this Lease together with the information required therein, subject, however, to the limitations herein. Lessor shall issue checks payable to Lessee or the payees designated by Lessee in a Request for Reimbursement. Any payments made to such payees or jointly to Lessee and any such payee shall constitute a reimbursement hereunder as though made directly to Lessee.

(d)Intentionally Omitted.

(e)With respect to any Planned Capital Refurbishment Project for a Facility, Lessor shall not be obligated to make any reimbursement under this Section 9.8, unless and until the following conditions shall have been satisfied (with proof thereof in form and sufficiency as may be reasonably requested by Lessor):

(i)To the extent not theretofore received by Lessor, Lessor shall have received (A) if applicable based on the nature of such Planned Capital Refurbishment Project, the applicable Plans and Specifications therefor (and any material changes thereto); (B) if applicable based on the nature of such Planned Capital Refurbishment Project (but in no event for any Planned Capital Refurbishment Project for which the Planned Capital Refurbishment Project Costs are less than $300,000), all construction contracts with any General Contractor, any Architect and any other contractor or material supplier that may be requested by Lessor; and (C) if applicable based on the nature of such Planned Capital Refurbishment Project, all authorizations and permits required by any Governmental Authority with jurisdiction for the construction/performance of such Planned Capital Refurbishment Project (if requested by Lessor);

(ii)To the extent applicable to such Planned Capital Refurbishment Project as reasonably determined by Lessor (but in no event other than in connection with a Material Alteration), Lessor shall have received evidence satisfactoryto Lessor that, following completion of such Planned Capital Refurbishment Project, (A) all existing public utilities, including telephone, water, sewage, electricity and gas are adequate for such Facility; and (B) all existing means of ingress and egress, parking, access to public streets and drainage facilities are adequate for such Facility.

(iii)To the extent applicable to such Planned Capital Refurbishment Project as reasonably determined by Lessor (but in no event other than in connection with a Material Alteration), Lessor shall have received test borings, engineering reports and such other site analysis as Lessor may require, all of which must indicate that the soil is adequate for the proposed construction/performance of such Planned Capital Refurbishment Project in accordance with the applicable Plans and Specifications.

(iv)Lessor shall have received evidence that may be requested by Lessor of the insurance required to be maintained by Lessee pursuant to Section 10.2.4 below.

(v)No Event of Default shall have occurred and be continuing under this Lease.

(vi)No Condemnation shall be pending or threatened and no casualty shall have occurred, in either case with respect to the Leased Property of such Facility or any portion thereof to the extent such Condemnation or casualty materially impacts the area in which the Planned Capital Refurbishment Project is being performed.

(vii)Lessor shall have received (A) a Request for Reimbursement accompanied by all necessary documents and certificates as set forth in the definition thereof; and (B) to the extent applicable (but in no event for any Planned Capital Refurbishment Project for which the Planned Capital Refurbishment Costs are less than $300,000, unless such Planned Capital Refurbishment Project otherwise constitutes a Material Alteration), a certificate from the Architect, or if no Architect, from an officer of Lessee or any other reliable Person acceptable to Lessor, to the effect that in such Person’s opinion (1) the construction/performance of such Planned Capital Refurbishment Project theretofore performed is substantially in accordance with the applicable Plans and Specifications and (2) the amount requested is appropriate in light of the construction completed.

(viii)To the extent applicable to the Planned Capital Refurbishment Project as reasonably determined by Lessor (but in no event for any Planned Capital Refurbishment Project for which the Planned Capital Refurbishment Costs are less than $300,000, unless such Planned Capital Refurbishment Project otherwise constitutes a Material Alteration), Lessor shall have received from each of the Architect and General Contractor, a letter, in form and substance reasonably satisfactory to Lessor, which (A) states that, in the event of a default by Lessee under the contract with the undersigned, the undersigned agrees to perform for Lessor at Lessor’s request under the terms of the applicable construction contract, (B) to the best knowledge of the undersigned certifies to Lessor that the applicable Plans and Specifications comply withall Legal Requirements, and that the work performed to date by the undersigned has been completed materially in accordance with the applicable Plans and Specifications, and (C) confirms such other matters consistent with the terms and provisions of this Section 9.8.5(e).

(ix)Lessor shall have inspected (or been given a reasonable opportunity to inspect within ten (10)Business Days after delivery of the applicable Request for Reimbursement) the work performed and materials supplied in connection with such Planned Capital Refurbishment Project and confirmed (to Lessor’s reasonable satisfaction) that the same comply with the provisions of this Lease, it being agreed that Lessee shall cooperate with Lessor as reasonably requested by Lessor (including by providing Lessor and its designees with access to the affected areas of the applicable Facility and (if requested) making the Architect and/or General Contractor (in each case if any) and representatives of Lessee available to accompany Lessor and its designees and/or provide information to Lessor) in connection with such inspection and confirmation.

ARTICLE X.

10.1Construction of Alterations. Except with respect to the pre-existing alterations projects (the “Pre-Existing Projects”) identified on Schedule 10.1 hereto (with respect to each of which the requirements of this Section 10.1 shall not apply), without the prior written consent of Lessor, which consent shall not be unreasonably conditioned, withheld or delayed to the extent that the Alteration satisfies the Minimum Alteration Standards (as defined below), Lessee shall not (a) except with respect to a Planned Capital Refurbishment Project with a cost that does not exceed One Million Dollars ($1,000,000), make any material Capital Additions or structural Alterations, (b) materially enlarge or reduce the size of any Facility or otherwise materially alter or affect (other than replacement thereof) any main Facility systems, including any main plumbing, electrical or heating, ventilating and air conditioning systems of any Facility and/or (c) make any Capital Additions or other Alterations which would tie in or connect with any improvements on property adjacent to the Land other than with respect to easements over such adjacent property entered into in accordance with the terms of this Lease (those Alterations described in clauses (a), (b)or (c)above, collectively, the “Material Alterations”). Lessee may, without Lessor’s prior written consent, make any Alterations if such Alterations are not Material Alterations, so long as in each case: (i) the same would not be reasonably expected to (A) decrease the value of the Leased Property, (B) materially affect the exterior appearance of any Facility, or (C) adversely affect the structural components of any Leased Improvements or the main electrical, mechanical, plumbing or ventilating and air conditioning systems for any Facility, (ii) the same are consistent in terms of style, quality and workmanship to the original Leased Improvements in all material respects (such requirements in the foregoing clauses (i)and (ii), the “Minimum Alteration Standards”), and (iii) the cost thereof does not exceed Three Hundred Thousand Dollars ($300,000) (or, in the case of a Planned Capital Refurbishment Project, $1,000,000) with respect to any single project at a Facility. Any other Alterations (i.e., other than Pre-Existing Projects, Material Alterations, and other than Alterations which meet the foregoing requirements of clauses (i), (ii)and (iii)above) shall be subject to Lessor’s prior written consent, which consent shall not be unreasonably conditioned, withheld or delayed to theextent that the Alterations satisfy the Minimum Alteration Standards. Notwithstanding the foregoing, Lessor agrees that painting, landscaping, replacements of floor, wall and window coverings and furniture replacements (the foregoing, collectively, “Cosmetic Alterations”) shall be deemed Alterations which do not require Lessor’s consent, regardless of the cost thereof, so long as the same meet the Minimum Alteration Standards. Any request by Lessee for Lessor’s consent to an Alteration requiring such consent hereunder shall be accompanied by a copy of the proposed plans and specifications and budget therefor, each of which shall be reasonably detailed and shall be subject to Lessor’s approval prior to commencement of the work.

10.2Construction Requirements for all Alterations.

10.2.1Except with respect to the Pre-Existing Projects, and except as expressly set forth below, for all Alterations and Capital Projects other than Cosmetic Alterations, the cost of which is Three Hundred Thousand Dollars ($300,000) or more per project, the following requirements shall apply (except to the extent Lessor reasonably determines that, because of the nature or extent of the Alteration, any such requirement is not applicable) Lessee shall (i) obtain and maintain the insurance required pursuant to Section 10.2.4 below, and (ii) not less than ten (10)Business Days prior to the commencement of construction for such Alteration, furnish to Lessor (x) a notice of non-responsibility with respect to such construction in form acceptable for recording in the Official Records of the County in which the Leased Property is located and (y) an Officer’s Certificate certifying that:

(a)Lessee shall cause such notice of non-responsibility to be recorded and posted in a conspicuous place on the Leased Property in conformance with all legal requirements applicable to such notices prior to commencement of any construction;

(b)Lessee shall have procured and paid for all municipal and other governmental permits and authorizations required therefor, provided that Lessor shall join in the application for such permits or authorizations whenever such action is necessary; provided, however, that (i) any such joinder shall be at no cost or expense to Lessor; and (ii) any plans required to be filed in connection with any such application which require the approval of Lessor as hereinabove provided shall have been so approved by Lessor;

(c)Such construction shall not impair the structural strength of any component of the applicable Facility or overburden the electrical, water, plumbing, HVAC or other building systems of any such component;

(d)Such construction shall, when completed, be of such a character as not to decrease the value of the Leased Property as it was immediately before such Capital Addition;

(e)All work done in connection with such construction shall be done in a good and workmanlike manner and in conformity with all Legal Requirements; and

(f)That if by reason of the construction thereof, a new Certificate of Occupancy for any component of such Facility is required, Lessee will obtain the same promptly upon completion thereof and furnish a copy thereof to Lessor upon request.

10.2.2Except with respect to Pre-Existing Projects, for all Material Alterations and other Alterations of the Leased Property, the cost of which is One Million Dollars ($1,000,000) or more per project, in addition to delivery of an Officer’s Certificate with respect thereto as required by Section 10.2.1 above, Lessee shall comply with the requirements of Sections 10.2.4 and 10.2.5 (if applicable) below and the following additional requirements (except to the extent Lessor reasonably determines that, because of the nature or extent of the Alteration, any such requirement is not applicable):

(a)Lessor shall deliver to Lessee a notice of non-responsibility with respect to such construction in form acceptable for recording in the Official Records of the County in which the Leased Property is located and Lessee shall cause such notice of non-responsibility to be recorded and posted in a conspicuous place on the Leased Property in conformance with all legal requirements applicable to such notices prior to commencement of any construction;

(b)Such construction shall not commence until Lessee shall have procured and paid for all municipal and other governmental permits and authorizations required therefor, and Lessor shall join in the application for such permits or authorizations whenever such action is necessary; provided, however, that (i) any such joinder shall be at no cost or expense to Lessor; and (ii) any plans required to be filed in connection with any such application which require the approval of Lessor as hereinabove provided shall have been so approved by Lessor;

(c)Such construction shall not, and, for any Alteration requiring Lessor’s approval hereunder, Lessee’s licensed architect or engineer shall certify to Lessor that such construction shall not, impair the structural strength of any component of the applicable Facility or overburden the electrical, water, plumbing, HVAC or other building systems of any such component;

(d)Lessee’s licensed architect or engineer shall certify to Lessor that the detailed plans and specifications conform to and comply in all material respects with all Insurance Requirements and all applicable building, subdivision and zoning codes, laws, ordinances, regulations and other Legal Requirements imposed by all Governmental Authorities having jurisdiction over the Leased Property;

(e)There shall be no material changes in the plans and specifications for such construction from those approved by Lessor, if applicable, without first obtaining the prior written approval of Lessor with respect to such changes, which approval shall not be unreasonably withheld, conditioned or delayed;

(f)Such construction shall, when completed, be of such a character as not to decrease the value of the Leased Property as it was immediately before such Capital Addition;

(g)During and following completion of such construction, the parking which is located in the applicable Facility or on the Land relating to such Facility shall remain adequate for the operation of such Facility for its Primary Intended Use and in no event shallsuch parking be less than that which was or is required by law or

which was located in such Facility or on the Land relating to such Facility prior to such construction; provided, however, with Lessor’s prior consent, not to be unreasonably withheld, conditioned or delayed to the extent the alterations satisfy the Minimum Alterations Standard and at no additional expense to Lessor, (i) to the extent additional parking is not already a part of a Capital Addition, Lessee may construct additional parking on the Land relating to such Facility; or (ii) Lessee may acquire off-site parking to serve such Facility as long as such parking shall be dedicated to, or otherwise made available to serve, such Facility;

(h)All work done in connection with such construction shall be done in a good and workmanlike manner and in conformity with all Legal Requirements;

(i)Promptly following the completion of such construction, Lessee shall deliver to Lessor “as built” drawings of such addition, certified as accurate by the licensed architect or engineer selected by Lessee to supervise such work; and

(j)If by reason of the construction thereof, a new or revised Certificate of Occupancy for any component of such Facility is required, Lessee shall obtain and furnish a copy of the same to Lessor promptly upon completion thereof.

10.2.3As it relates solely to the construction of Pre-Existing Projects, Lessee shall, at the completion of any Pre-Existing Project provide Lessor with an Officer’s Certificate certifying that:

(a)Such construction shall not impair the structural strength of any component of the applicable Facility or overburden the electrical, water, plumbing, HVAC or other building systems of any such component;

(b)Such construction shall, when completed, be of such a character as not to decrease the value of the Leased Property as it was immediately before such Pre-Existing Project;

(c)All work done in connection with such construction shall be done in a good and workmanlike manner and in conformity with all Legal Requirements; and

(d)That if by reason of the construction thereof, a new Certificate of Occupancy for any component of such Facility is required, Lessee will obtain the same promptly upon completion thereof and promptly furnish a copy thereof to Lessor.

10.2.4To the extent not already maintained or covered by Lessee pursuant to Article XIII hereof, Lessee shall at all times maintain or cause to be maintained the following insurance during such construction of any alterations other than Cosmetic Alterations (including through the date of completion of any punch list items relating thereto): Builder’s risk insurance covering such construction, in a face amount of not less than the full insurable value thereof and materials supplied in connection therewith, with appropriate provisions made to include coverage of materials stored off the Leased Property in an amount not less than the full insurable value of such materials stored off the Leased Property from time to time.

All such insurance maintained or caused to be maintained by Lessee pursuant to this Section 10.2.4 shall be on an occurrence (as opposed to claims made) basis and shall name Lessor as an additional insured. All insurance maintained or caused to be maintained by Lessee pursuant to subsection (i)above shall name Lessee, Lessor and any contractor, jointly, as loss payee; provided, however, that no contractor shall be required to be so named with respect to Pre-Existing Projects. In addition, all such insurance to be maintained or caused to be maintained by Lessee shall otherwise, to the extent applicable, comply with the provisions of and shall be in addition to the insurance specified in Article XIII hereof.

10.2.5Except with respect to Pre-Existing Projects, with respect to any Alteration the cost of which is in excess of Ten Million Dollars ($10,000,000), Lessee shall procure or cause to be procured a payment and performance bond in form and substance and from an institution reasonably satisfactory to Lessor. The amount of each bond shall be equal to one hundred twenty-five percent (125%) of the estimated construction costs for the performance bond and one hundred percent (100%) of the estimated construction costs for the labor and materials bond. Lessee shall cause Lessor to be named as an additional obligee in any payment and performance bond procured by Lessee in accordance with the foregoing provisions of this Section 10.2.5 or otherwise in respect of any Alterations.

10.2.6With respect to any consent or approval of, or delivery of information or materials by, Lessor required under Article IX, this Article X, Article XIV or pursuant to any other provision of this Lease which requires Lessee to obtain Lessor’s consent or approval or requires Lessor to deliver any information or materials to Lessee or any other Person, the failure by Lessor to respond to Lessee’s written request for such required approval or consent (provided that such request also includes all items required to be delivered to Lessor in connection with any such request under the applicable Sections hereof) shall constitute Lessor’s deemed approval of the subject request, provided that (i) any such notice is delivered in accordance with the provisions of Section 33.1 hereof, and (ii) if Lessor has not responded to such request within thirty (30) days or, in the case of a Planned Capital Refurbishment Project, fifteen (15) days (or such other period, if any, as expressly provided for in the applicable Section hereof) after Lessor’s receipt of such initial request and thereafter Lessee delivers a second notice to Lessor including the following legend in bold, fourteen (14) point type at the top of such request: “THIS IS A SECOND REQUEST FOR APPROVAL PURSUANT TO SECTIONOF THE LEASE. FAILURE TO RESPOND TO THIS REQUEST WITHIN FIVE (5)BUSINESS DAYS WILL RESULT IN THE REQUEST BEING DEEMED GRANTED” and Lessor fails to timely respond to such second notice.

ARTICLE XI.

11.1Liens. Subject to the provisions of Article XII regarding permitted contests, Lessee will not directly or indirectly create or allow to remain and will promptly discharge at its expense any lien, encumbrance, attachment, title retention agreement or claim upon the Leased Property or any Capital Additions or any attachment, levy, claim or encumbrance in respect of the Rent, excluding, however, (i) this Lease; (ii) Permitted Encumbrances; (iii) restrictions, liens and other encumbrances which are consented to in writing by Lessor, or any easements granted pursuant to the provisions of Section 7.3; (iv) liens for Impositions which Lessee is not required to pay hereunder; (v) subleases permitted byArticle XXIV; (vi) liens for Impositions not yet delinquent; (vii) liens of mechanics, laborers, materialmen, suppliers or vendors for amounts not yet due; (viii) any liens which are the responsibility of Lessor pursuant to the provisions of Article XXXVI or are otherwise granted by Lessor in breach of the terms of this Lease; and (ix)any judgment liens against Lessor for amounts which are not otherwise the responsibility of Lessee.

ARTICLE XII.

12.1Permitted Contests. Lessee, on its own or in Lessor’s name, at Lessee’s expense, may contest, by appropriate legal proceedings conducted in good faith and with due diligence, the amount, validity or application, in whole or in part, of any licensure or certification decision,Imposition, Legal Requirement,Insurance Requirement, lien, attachment, levy, encumbrance, charge or claim; subject, however, to the further requirement that (i) in the case of an unpaid Imposition, lien, attachment, levy, encumbrance, charge or claim, the commencement and continuation of such proceedings shall suspend the collection thereof from Lessor and from the Leased Property or any Capital Additions; (ii) neither the Leased Property nor any Capital Additions, the Rent therefrom nor any part or interest in either thereof would be in any danger of being sold, forfeited, attached or lost pending the outcome of such proceedings; (iii) in the case of a Legal Requirement, neither Lessor nor Lessee would be in any danger of criminal liability for failure to comply therewith pending the outcome of such proceedings and Lessor would not be in danger of civil liability for any such failure; (iv) in the case of a Legal Requirement,Imposition, lien, encumbrance or charge, Lessee shall give such reasonable security as may be required by Lessor to insure ultimate payment of the same and to prevent any sale or forfeiture of the Leased Property or any Capital Additions or the Rent by reason of such nonpayment or noncompliance; and (v) in the case of an Insurance Requirement, the coverage required by Article XIII shall be maintained; provided however, that Lessee shall provide Lessor with prior written notice of any such contest if such contest relates to (a) a material claim against real property, (b) any matter that could, if adversely determined, reasonably be expected to result in a denial, suspension, revocation or loss of license or certification for any Facility, or (c) in addition to (and not in limitation of) the foregoing (a)and (b), any matter that could reasonably be expected to have a material adverse effect on Lessee’s Primary Intended Use of the subject Facility. If any such contest is finally resolved against Lessor or Lessee, Lessee shall promptly pay the amount required to be paid, together with all interest and penalties accrued thereon, or comply with the applicable Legal Requirement or Insurance Requirement. Lessor, at Lessee’s expense, shall execute and deliver to Lessee such authorizations and other documents as may reasonably be required in any such contest, and, if reasonably requested by Lessee or if Lessor so desires, Lessor shall join as a party therein. The provisions of this Article XII shall not be construed to permit Lessee to contest the payment of Rent or any other amount payable by Lessee to Lessor hereunder. Lessee shall indemnify, defend, protect and save Lessor and its Affiliates harmless from and against any liability, cost or expense of any kind that may be imposed upon Lessor or any of its Affiliates in connection with any such contest and any loss resulting therefrom.

ARTICLE XIII.

13.1General Insurance Requirements. Lessee shall, at all times during the Term and at any other time Lessee shall be in possession of the Leased Property, keep the Leased Property and all property located therein or thereon, including all Capital Additions, Fixtures and Personal Property, insured against the risks described below. Each element of the insurance described in this Articleshall be maintained with respect to the Leased Property including all Capital Additions, Fixtures and Personal Property, and operations thereon. The policies shall insure against the following risks with respect to each Facility:

13.1.1“All-risk” property insurance (and to the extent applicable, Builder’s Risk Insurance) on the Leased Property and all items of business personal property, including but not limited to signs, awnings, canopies, gazebos, fences and retaining walls, and all Personal Property, including without limitation, insurance against loss or damage from the perils under “All Risk” (Special) form, including but not limited to the following: fire, windstorm, sprinkler leakage, vandalism and malicious mischief, flood, water damage, explosion of steam boilers, pressure vessels and other similar apparatus, and other hazards generally included under extended coverage, all in an amount equal to one hundred percent (100%) of the replacement value of the Leased Property (excluding excavation and foundation costs), business personal property and Personal Property, without a co-insurance provision, and shall include an “Agreed Value” endorsement. Such coverage may be purchased under a master policy which includes other facilities managed, leased or owned by the Lessee, which provides for a “Blanket Limit” to apply on a per occurrence basis and which shall not be lower than one hundred percent (100%) of the replacement value of the Leased Property (excluding excavation and foundation costs), business personal property and Personal Property. Notwithstanding anything to the contrary in this Section 13.1.1, the limits for windstorm shall be in an amount not less than the projected probable maximum loss for the Leased Property, business personal property and Personal Property as calculated using RMS or another generally industry accepted modeling system using a 250 year return period, nor shall the deductible be greater than five percent (5%) of the replacement cost and business interruption value of the Leased Property and business personal property unless such deductible is commercially unavailable, in which event Lessee shall maintain the lowest deductible that is available;

13.1.2Ordinance or Law Coverage with limits of not less than the Leased Property for loss to the undamaged portion of the building, limits not less than $500,000.00 for Demolition Cost Coverage, and limits not less than $500,000.00 for Increased Cost of Construction Coverage;

13.1.3Business income insurance to be written on “Special Form” (and on “Earthquake” and “Flood” forms if such insurance for those risks is required) including “Extra Expense”, without a provision for co-insurance, including an amount sufficient to pay at least twelve (12) months of Rent for the benefit of Lessor, as its interest may appear, and at least twelve (12) months of “Net Operating Income” less Rent for the benefit of Lessee. Such insurance may be purchased under a master policy which includes other facilities managed, leased or owned by the Lessee, which provides for a “Blanket Limit” to apply on a per occurrence basis and which shall not be lower than twelve (12) months loss of Rent and twelve(12) months of “Net Operating Income” of such Facility (excluding excavation and foundation costs), business personal property and Personal Property.

13.1.4Occurrence form commercial general liability insurance, including bodily injury and property damage, liquor liability (if applicable), fire legal liability, contractual liability and independent contractor’s hazard and completed operations coverage in an amount not less than $1,000,000.00 per occurrence and covering claims arising from the use or operation of such Facility both before and after the Commencement Date;

13.1.5Umbrella liability coverage which shall be on a following form for the general liability, automobile liability, malpractice and liquor liability (if applicable), with limits in a minimum amount of not less than $25,000,000.00 per occurrence/aggregate and covering claims arising from the use or operation of such Facility both before and after the Commencement Date;

13.1.6Malpractice insurance/professional liability insurance in an amount not less than $1,000,000.00 for each person and each occurrence to cover claims arising out of the professional services provided by Lessee at such Facility, whether arising from the use or operation of such Facility before or after the Commencement Date;

13.1.7Flood insurance (if the Leased Property is located in whole or in part within an area identified as an area having special flood hazards under the National Flood Insurance Program) for the full (100%) replacement value of the Leased Property and all items of business personal property or any greater amount as may be required by the National Flood Insurance Program, with a deductible no greater than five percent (5%) of the replacement cost and business interruption value of the Leased Property and business personal property unless such deductible is commercially unavailable, in which event Lessee shall maintain the lowest deductible that is available;

13.1.8Worker’s compensation coverage, or equivalent excess insurance for self insured or non-subscriber states, for all persons employed by Lessee on the Leased Property with statutory limits and containing a waiver of subrogation in favor of Lessor;

13.1.9Business auto liability insurance, including owned, non-owned and hired vehicles for combined single limit of bodily injury and property damage of not less than $1,000,000.00 per occurrence;

13.1.10“Earthquake” insurance, if the Leased Property is currently, or at any time in the future, located within a major earthquake disaster area (it being agreed that California, the New Madrid Seismic Zone, and the Pacific Northwest Seismic Zone are deemed major earthquake disaster areas for purposes of this Lease), in amount, and in such form and substance and with such limits and deductibles as are satisfactory to Lessor, provided that the limits for earthquake shall be in an amount not less than the projected probable maximum loss for the Leased Property, business personal property and Personal Property as calculated using RMS or another generally industry accepted modeling system using a 250 year return period, nor shall the deductible be greater than five percent (5%) of the replacement cost and business interruption value of the Leased Property and business personal property unless such deductibleis commercially unavailable, in which event Lessee shall maintain the lowest deductible that is available;

13.1.11Crime insurance covering employee theft in an amount not less than $1,500,000.00; and

13.1.12Such additional insurance or increased insurance limits as may be reasonably required, from time to time, by Lessor (including, without limitation, in connection with any mortgage, security agreement or other financing permitted hereunder and then affecting the Leased Property, as well as any declaration, ground lease or easement agreement affecting the Leased Property), or any holder of any mortgage, deed of trust or other security agreement (“Facility Mortgagee”) securing any indebtedness or any other encumbrance placed on the Leased Property in accordance with the provisions of Article XXXVI (“Facility Mortgage”), provided the same is customarily carried by a majority of comparable facilities for the Primary Intended Use in the area.

Without limiting the generality of the foregoing Section 13.1.12, the required commercial liability insurance and umbrella liability coverage limits and deductible amounts pertaining thereto as set forth in this Article XIII shall in no event provide less coverage (lower limits or higher deductibles) than the “Comparable Insurance Coverage” carried on any of the other skilled nursing, independent living, assisted living and dementia care facilities operated or owned by Lessee and any Guarantor and their Affiliates, and the insurance coverage for the Leased Property shall immediately be increased by Lessee to equal any greater or increased “Comparable Insurance Coverage” carried or obtained for such other facilities. For purposes of the foregoing, “Comparable Insurance Coverage” shall mean insurance coverage levels adjusted for relevant variations in risk and insurability characteristics between the insured facilities being compared, including without limitation consideration of variations in insurance coverages carried by Guarantors and their Affiliates between different insurance markets (states or other jurisdictional subdivisions) where

insured risks or insurance pricing or availability varies materially. Lessee shall use all reasonable efforts to obtain increased umbrella liability coverage of not less than $50,000,000 per occurrence/aggregate, and decreased liability insurance deductibles, at such time as the same can be obtained at commercially reasonable or economically feasible rates for the Leased Property. Until such increased coverages are obtained Lessee shall provide to Lessor a thorough annual update and review of the overall liability insurance coverage program and strategy for Lessee and Guarantors and their Affiliates, which shall include an analysis of market rates for the current and desired liability insurance coverages. In addition, Lessee shall have the right to provide commercial general liability insurance coverage on a “claims made” basis, so long as the general liability insurance coverages otherwise required hereunder are maintained or continued in existence at all times throughout the Term for all periods that Lessee or its Affiliates have had any ownership or use of the Leased Property , and evidence thereof has been provided to Lessor. Notwithstanding the foregoing, however, any such claims made policy must include therein the right to purchase a “tail” that insures against so-called “incurred but not reported claims” for a period of not less than three (3) years following the expiration of such claims made policy. Upon the expiration of any such claims made policy, Lessee shall either (i) purchase a three (3) year “tail” policy covering any so-called “incurred but not reported claims” during the prior policy period or (ii) provide other insurance covering“incurred but not reported claims” for such prior policy period for a period of not less than three (3) years thereafter in form satisfactory to Lessor.

13.2Waiver of Subrogation. Lessor and Lessee agree that with respect to any property loss which is covered by insurance then being carried by Lessor or Lessee, respectively, the party carrying such insurance and suffering said loss releases the other of and from any and all claims with respect to such loss; and they further agree that their respective insurance companies shall have no right of subrogation against the other on account thereof.

13.3General Provisions. Each Facility’s allocated deductible for general liability insurance and professional liability insurance shall not exceed $1,000,000 for independent living, skilled nursing and assisted living and memory care, to the extent commercially available, and $1,000,000 for workmen’s compensation insurance, to the extent commercially available, unless any greater amounts are agreeable to both Lessor and Lessee. Each Facility’s property insurance deductible shall not exceed $250,000.00 unless such greater amount is agreeable to both Lessor and Lessee. Subject to Lessor’s rights pursuant to Sections 13.1.7 and 13.1.10, all insurance policies pursuant to this Article XIII shall be issued by insurance carriers having a general policy holder’s rating of no less than A-/VII in Best’s latest rating guide and authorized to do insurance business in the State in which the Leased Property is located, and shall contain clauses or endorsements to the effect that (a) Lessor shall not be liable for any insurance premiums thereon or subject to any assessments thereunder, and (b) the coverages provided thereby will be primary and any insurance carried by any additional insured shall be excess and non-contributory to the extent of the indemnification obligation pursuant to Article XXIII below. All such policies described in Section 13.1 shall name Lessor and any Facility Mortgagee whose name and address has been provided to Lessee as additional insureds, loss payees, or mortgagees, as their interests may appear and to the extent of their indemnity. All loss adjustments shall be payable as provided in Article XIV. Lessee shall deliver certificates thereof to Lessor prior to their effective date, which certificates shall state the nature and level of coverage reported thereby, as well as the amount of the applicable deductible. Upon Lessor’s request, duplicate original copies of all insurance policies to be obtained by Lessee shall be provided to Lessor by Lessee. All such policies shall provide Lessor (and any Facility Mortgagee whose name and address has been provided to Lessee if required by the same) thirty (30) days prior written notice of any material change or cancellation of such policy, if agreed to by the insurers.

In the event Lessee shall fail to effect such insurance as herein required, to pay the premiums therefor or to deliver such certificates to Lessor or any Facility Mortgagee at the times required, Lessor shall have the right, but not the obligation, to acquire such insurance and pay the premiums therefor, which amounts shall be payable to Lessor, upon demand, as Additional Charges, together with interest accrued thereon at the Overdue Rate from the date such payment is made until (but excluding) the date repaid.

13.4Increase in Limits. If either party shall at any time believe the limits of the insurance required by Sections 13.1.1 and 13.1.7 and business income insurance required by Section 13.1.3, for the perils windstorm and flood, as applicable, if the Leased Property is located in Tier 1 and Tier 2 wind zones or areas designated as High Hazard Flood zones underthe National Flood Insurance Program (collectively, the “Windstorm and Flood Insurance”), to be either excessive or insufficient, the parties shall endeavor to agree in writing on the proper and reasonable limits for such Windstorm and Flood Insurance to be carried and such Windstorm and Flood Insurance shall thereafter be carried with the limits thus agreed on until further change pursuant to the provisions of this Article XIII; provided, however, that such changes shall not occur more frequently than one (1) time per Lease Year. Nothing herein shall permit the amount of Windstorm and Flood Insurance to be reduced below the amount or amounts required by any Facility Mortgagee.

13.5Blanket Policies. Notwithstanding anything to the contrary contained in this Article XIII, Lessee’s obligation to maintain the insurance herein required may be brought within the coverage of a so-called blanket policy or policies of insurance carried and maintained by Lessee, so long as such policies otherwise meet all requirements under this Article XIII.

ARTICLE XIV.

14.1Insurance Proceeds. All proceeds payable by reason of any loss or damage to the Leased Property, any Capital Additions or any part(s)or portion(s)thereof, under any policy of insurance required to be carried hereunder shall be paid to Lessor and made available by Lessor to Lessee from time to time for the reasonable costs of reconstruction or repair, as the case may be, of any damage to or destruction of the Leased Property, any Capital Additions or any part(s)or portion(s)thereof, provided, however, that Lessor shall be entitled to retain (and not make available for reconstruction or repair) all insurance proceeds payable during the last two (2) Lease Years or in respect of any casualty or damage for which the restoration period is reasonably expected to extend beyond the then remaining

Term. Any excess proceeds of such insurance remaining after the completion of (and payment for) the restoration or reconstruction of the Leased Property and any Capital Additions (or in the event neither Lessor nor Lessee is required or elects to repair and restore, all such insurance proceeds) shall be retained by Lessor except as otherwise specifically provided below in this Article XIV. All salvage resulting from any risk covered by insurance shall belong to Lessor. If a Facility Mortgagee requires that any insurance proceeds be applied towards the repayment of Lessor’s debt (rather than for restoration or reconstruction of the Leased Property and any Capital Additions), then Lessor shall furnish Lessee with the amount of funds which otherwise would have been made available to Lessee but for such actions of such Facility Mortgagee and such funds shall be used by Lessee for restoration or reconstruction of the Leased Property and Capital Additions.

14.2Insured Casualty.

14.2.1If the Leased Property and/or any Capital Additions of any Facility are damaged or destroyed from a risk covered by insurance carried by Lessee such that such Facility thereby is rendered Unsuitable for its Primary Intended Use, Lessee shall either (i) restore such Leased Property and such Capital Additions to substantially the same condition as existed immediately before such damage or destruction, or (ii) offer to acquire the Leased Property of such Facility from Lessor for a purchase price equal to the greater of (y) the Minimum Purchase Price of such Facility or (z) the Fair Market Value of such Facility immediately prior to such damage or destruction. If Lessor does not accept Lessee’s offer to sopurchase the Leased Property of such Facility within 45 days after Lessor’s receipt of Lessee’s written offer, Lessee may either withdraw such offer and proceed to restore the Leased Property of such Facility to substantially the same condition as existed immediately before such damage or destruction or terminate the Lease with respect to such Facility in which event Lessor shall be entitled to retain the insurance proceeds payable on account of such casualty.

14.2.2If the Leased Property and/or any Capital Additions of any Facility are damaged from a risk covered or required to be covered by insurance carried by Lessee, but such Facility is not thereby rendered Unsuitable for its Primary Intended Use, Lessee shall restore such Leased Property and such Capital Additions to substantially the same condition as existed immediately before such damage. Such damage shall not terminate this Lease; provided, however, that if Lessee cannot within a reasonable time after diligent efforts obtain the necessary government approvals needed to restore and operate such Facility for its Primary Intended Use, Lessee may offer to purchase the Leased Property of such Facility for a purchase price equal to the greater of the Minimum Purchase Price of such Facility or the Fair Market Value of such Facility immediately prior to such damage. If Lessee shall make such offer and Lessor does not accept the same within 45 days after Lessor’s receipt of Lessee’s written offer, Lessee may either withdraw such offer and proceed to restore the Leased Property of such Facility to substantially the same condition as existed immediately before such damage or destruction, or terminate the Lease with respect to such Facility, in which event Lessor shall be entitled to retain the insurance proceeds.

14.2.3If the cost of the repair or restoration exceeds the amount of proceeds received by Lessor from the insurance required to be carried hereunder, Lessee shall contribute any excess amounts needed to restore such Facility. Such difference shall be paid by Lessee to Lessor together with any other insurance proceeds, for application to the cost of repair and restoration.

14.2.4If Lessor accepts Lessee’s offer to purchase the Leased Property of any Facility, this Lease shall terminate as to such Facility upon payment of the purchase price and Lessor shall remit to Lessee all insurance proceeds pertaining to the Leased Property of such Facility received by Lessor, including any amounts applied by a Facility Mortgagee to Lessor’s debt.

14.3Uninsured Casualty. If the Leased Property and/or any Capital Additions of any Facility are damaged or destroyed from a risk not covered by insurance carried by Lessee and not required to be covered by insurance by Lessee as provided herein, such that such Facility thereby is rendered Unsuitable for its Primary Intended Use, Lessee shall either (i) restore such Leased Property and such Capital Additions to substantially the same condition as existed immediately before such damage or destruction, or (ii) offer to acquire the Leased Property of such Facility from Lessor for a purchase price equal to the greater of (y) the Minimum Purchase Price of such Facility or (z) the Fair Market Value of such Facility immediately prior to such damage or destruction. If Lessor does not accept Lessee’s offer to so purchase the Leased Property of such Facility within 45 days, Lessee may either withdraw such offer and proceed to restore the Leased Property of such Facility to substantially the same condition as existed immediately before such damage or destruction or terminate the Lease with respect to such Facility.

14.3.1If the Leased Property and/or any Capital Additions of any Facility are damaged from a risk not covered by insurance carried by Lessee and not required to be covered by insurance by Lessee as provided herein, but such Facility is not thereby rendered Unsuitable for its Primary Intended Use, Lessee shall restore such Leased Property and such Capital Additions to substantially the same condition as existed immediately before such damage. Such damage shall not terminate this Lease; provided, however, that if Lessee cannot within a reasonable time after diligent efforts obtain the necessary government approvals needed to restore and operate such Facility for its Primary Intended Use (and, if Lessor so elects, Lessor cannot obtain the same within a reasonable time thereafter), Lessee may offer to purchase the Leased Property of such Facility for a purchase price equal to the greater of the Minimum Purchase Price of such Facility or the Fair Market Value of such Facility immediately prior to such damage. If Lessee shall make such offer and Lessor does not accept the same within 45 days, Lessee may either withdraw such offer and proceed to restore the Leased Property of such Facility to substantially the same condition as existed immediately before such damage or destruction, or terminate the Lease with respect to such Facility.

14.3.2If Lessor accepts Lessee’s offer to purchase the Leased Property of any Facility, this Lease shall terminate as to such Facility upon payment of the purchase price.

14.4No Abatement of Rent. This Lease shall remain in full force and effect and Lessee’s obligation to pay the Rent and all other charges required by this Lease shall remain unabated during the period required for adjusting insurance, satisfying Legal Requirements, repair and restoration. All proceeds payable by reason of any loss of rental or business interruption under any policy of insurance required to be carried by Lessee hereunder shall be paid to Lessor and, provided that no Event of Default has occurred and is continuing, Lessor shall (a) apply, on a monthly basis, all such proceeds paid by reason of loss of rental towards Lessee’s obligation to pay Rent, and (b) make available to Lessee for Lessee’s operating costs (e.g., payment of salaries, taxes,etc.), on a monthly basis, all such proceeds paid by reason of business interruption. Any excess proceeds of such insurance remaining after such rent and operating costs have been paid shall be delivered to Lessee.

14.5Waiver. Lessee waives any statutory rights of termination which may arise by reason of any damage or destruction of the Leased Property and/or any Capital Additions.

ARTICLE XV.

15.1Condemnation.

15.1.1Total Taking. If the Leased Property and any Capital Additions of a Facility are totally and permanently taken by Condemnation, this Lease shall terminate with respect to such Facility as of the day before the Date of Taking for such Facility.

15.1.2Partial Taking. If a portion of the Leased Property and any Capital Additions of a Facility is taken by Condemnation, this Lease shall remain in effect if the affected Facility is not thereby rendered Unsuitable for Its Primary Intended Use, but if suchFacility is thereby rendered Unsuitable for its Primary Intended Use, this Lease shall terminate with respect to such Facility as of the day before the Date of Taking for such Facility, in which event Lessor shall be entitled to receive the Award, if any, and the Minimum Rent due hereunder shall be reduced by the amount of the Allocated Minimum Rent for the Facility as to which the Lease has so terminated.

15.1.3Restoration. If there is a partial taking of the Leased Property and any Capital Additions of a Facility and this Lease remains in full force and effect pursuant to Section 15.1.2, Lessor shall, subject to the rights of Facility Mortgagees (provided that the same shall be subject to the terms of any applicable subordination and non-disturbance agreement entered into between Lessee and the applicable Facility Mortgagee), make available to Lessee the portion of the Award necessary and specifically identified or allocated for restoration of such Leased Property and any such Capital Additions and Lessee shall complete all necessary restoration and pay the additional costs thereof if the amount provided or allocated by the Condemnor for restoration is insufficient.

15.1.4Award-Distribution. The entire Award shall belong to and be paid to Lessor, except that, subject to the rights of the Facility Mortgagees, Lessee shall be entitled to receive from the Award, if and to the extent such Award specifically includes such item, lost profits value and moving expenses, provided, that in any event Lessor shall receive from the Award, subject to the rights of the Facility Mortgagees (provided that the same shall be subject to the terms of any applicable subordination and non-disturbance agreement entered into between Lessee and the applicable Facility Mortgagee), no less than the greater of the Fair Market Value of the applicable Facility prior to the institution of the Condemnation or the Minimum Purchase Price of the applicable Facility.

15.1.5Temporary Taking. The taking of the Leased Property, any Capital Additions and/or any part(s)thereof, shall constitute a taking by Condemnation only when the use and occupancy by the taking authority has continued for longer than one hundred eighty (180) consecutive days. During any shorter period, which shall be a temporary taking, all the provisions of this Lease shall remain in full force and effect and the Award allocable to the Term shall be paid to Lessee.

15.1.6Sale Under Threat of Condemnation. A sale by Lessor to any Condemnor, either under threat of Condemnation or while Condemnation proceedings are pending, shall be deemed a Condemnation for purposes of this Lease. Lessor may, without any obligation to Lessee, agree to sell and/or convey to any Condemnor all or any portion of the Leased Property free from this Lease and the rights of Lessee hereunder without first requiring that any action or proceeding be instituted or pursued to judgment. Notwithstanding the foregoing, Lessor agrees that if Lessee notifies Lessor in writing of Lessee’s intent to contest (in accordance with Article XII) any such Condemnation proceeding, Lessor shall not sell and/or convey to any Condemnor all or any portion of the Leased Property prior to any such contested action or proceeding being finally resolved or abandoned by Lessee.

15.1.7Rights of Facility Mortgagees. Notwithstanding anything herein to the contrary, the provisions of this Article XV are subject to the rights of the Facility Mortgagees (provided that the same shall be subject to the terms of any applicable subordinationand non-disturbance agreement entered into between Lessee and the applicable Facility Mortgagee).

ARTICLE XVI.

16.1Events of Default. Any one or more of the following shall constitute an “Event of Default”:

(a)Intentionally Omitted;

(b)Lessee shall fail to pay any installment of Minimum Rent when the same becomes due and payable and such failure is not cured by Lessee within a period of five (5)Business Days after notice thereof

from Lessor; provided, however, that (to the extent permitted by applicable law) such notice shall be in lieu of and not in addition to any notice required under applicable law;

(c)Lessee shall fail to pay any Additional Charges when the same becomes due and payable and such failure is not cured by Lessee within a period of ten (10)Business Days after notice thereof from Lessor;

(d)Lessee fails to pay Impositions with relating to real estate taxes prior to the same becoming delinquent, provided that it shall not be an Event of Default hereunder if (i) Lessee pays the amounts then due with respect to such real estate taxes (including any penalties or late charges) within a period of ten (10)Business Days after the same becoming delinquent, or (ii) an impound account shall have been established pursuant to Section 4.4.1 hereof and Lessor fails to apply funds on deposit in such account to pay such Impositions relating to real estate taxes;

(e)Lessee fails to pay insurance premiums on or before the date due to ensure continued coverage under all policies required to be maintained under this Lease, provided that it shall not be an Event of Default hereunder if an impound account shall have been established pursuant to Section 4.4.2 hereof and Lessor fails to apply funds on deposit in such account to pay such insurance premiums;

(f)except as otherwise specifically provided for in this Section 16.1, if Lessee shall fail to observe or perform any other term, covenant or condition of this Lease and such failure is not cured by Lessee within forty-five (45) days after notice thereof from Lessor, unless such failure cannot with due diligence be cured within a period of forty-five (45) days, in which case such failure shall not be deemed to be an Event of Default if Lessee proceeds promptly and with due diligence to cure the failure and diligently completes the curing thereof; provided, however, that (to the extent permitted by applicable law) such notice shall be in lieu of and not in addition to any notice required under applicable law;

(g)Lessee or any Guarantor shall:

(i)file a petition in bankruptcy or a petition to take advantage of any insolvency act,

(ii)make an assignment for the benefit of its creditors,

(iii)consent to the appointment of a receiver of itself or of the whole or any substantial part of its property, or

(iv)file a petition or answer seeking reorganization or arrangement under the Federal bankruptcy laws or any other applicable law or statute of the United States of America or any state thereof;

(h)Lessee or any Guarantor shall be adjudicated as bankrupt or a court of competent jurisdiction shall enter an order or decree appointing, without the consent of Lessee, a receiver of Lessee or of the whole or substantially all of its property, or approving a petition filed against it seeking reorganization or arrangement of Lessee under the Federal bankruptcy laws or any other applicable law or statute of the United States of America or any state thereof, and such judgment, order or decree shall not be vacated or set aside or stayed within sixty (60) days from the date of the entry thereof;

(i)Lessee or any Guarantor shall be liquidated or dissolved, or shall begin proceedings toward such liquidation or dissolution, or shall, in any manner, permit the sale or divestiture of substantially all of its assets (except to the extent permitted pursuant to Article XXIV hereof);

(j)the estate or interest of Lessee in the Leased Property, any Capital Additions or any part(s)thereof shall be levied upon or attached, in an amount in excess of Five Hundred Thousand Dollars ($500,000) with respect to any one (1) Facility, in any proceeding and the same is not either (i) fully bonded over by Lessee, (ii) being contested by Lessee as permitted by Article XII hereof, or (ii) vacated or discharged within the later of ninety (90) days after commencement thereof or thirty (30) days after receipt by Lessee of notice thereof from Lessor; provided, however, that such notice shall be in lieu of and not in addition to any notice required under applicable law;

(k)any Transfer occurs without Lessor’s consent in accordance with the provisions of Article XXIV;

(l)at any time when a Guaranty is required to be in place pursuant to this Lease, (i) such Guaranty has not been executed and delivered or is otherwise not in full force and effect, (ii) any of the representations or warranties made by Lessee or any Guarantor in the Guaranty or this Lease proves to be untrue when made in any material respect which materially and adversely affects Lessor, or (iii) a material default shall occur under the Guaranty and, in each case, such material default is not cured within any applicable notice and cure period set forth therein;

(m)(x)there is issued any final non-appealable (i) stop placement order against Lessee, or (ii) termination or revocation of a Facility’s applicable license material to such Facility’s operation for its Primary Intended Use, or any termination or revocation of any third-party provider reimbursement agreements (including, without limitation, its certification for participation in the Medicare or Medicaid reimbursement programs) that is not reinstated or replaced within twenty (20) days, or (y) there occurs any termination or revocation that is subjectto appeal

by Lessee, or any suspension of any such license that results in the subject Facility ceasing operation for a period of more than twenty (20) consecutive days at any time;

(n)(i) any local, state or federal agency having jurisdiction over the operation of any Facility removes ten percent (10%) or more of the patients or residents located in such Facility, (ii) any local, state or federal agency having jurisdiction over any Facility reduces the number of licensed units for such Facility from that number set forth under the heading “Facility Description and Primary Intended Use” on Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto (in other than a de minimis amount not to exceed three percent (3%) in the aggregate for each Facility during the Term and provided that such reductions are not related to any quality of care issues at the Facility or any other matter reasonably within Lessee’s control), (iii) without Lessor’s prior written consent not to be unreasonably withheld, conditioned or delayed (it being acknowledged, for purposes of this clause (iii)and clause (iv) below, that it shall in no event be unreasonable for Lessor to withhold its consent to any removal of a licensed unit in connection with the licensing of another unit at a facility which is not owned by Lessor or any of its Affiliates), Lessee voluntarily reduces (x) the number of licensed units for any Facility from that number set forth on Exhibit X-0, Xxxxxxx X-0 or Exhibit A-3 attached hereto or (y) the number of residents permitted to occupy any Facility, or (iv) without Lessor’s prior written consent not to be unreasonably withheld, conditioned or delayed, Lessee voluntarily removes from service any licensed units for any Facility, unless as to clause (iii)or (iv)above, (1) such unit is removed in order to combine it with another unit to create a larger resident unit or convert it to create space to provide another use (whether the Primary Intended Use of such Facility or any reasonably required office, storage space or ancillary services use incidental to the Primary Intended Use), (2) the aggregate number of units so removed from any Facility does not exceed the lesser of (A) five percent (5%) of the total number of licensed units for such Facility and (B) four (4), and (3) a future application for the licensing of units of the same type and number as the removed units would not (under the laws in effect at the time of such removal) require a certificate of need or any similar requirement;

(o)Subject to Article XII regarding permitted contests, Lessee fails to cure or xxxxx any material violation occurring during the Term that is claimed by any Governmental Authority, or any officer acting on behalf thereof, of any Legal Requirement pertaining to the operation of any Facility, and within the time permitted by such authority for such cure or abatement;

(p)any default and acceleration of any indebtedness of Lessee or Guarantor for borrowed money with an outstanding principal amount of Twenty Five Million Dollars ($25,000,000) has occurred; and

(q)a default beyond any applicable notice, grace or cure period shall occur under any other lease agreement or guaranty, any loan documents or any other material agreement or instrument, now or hereafter with or in favor of Lessor or any Affiliate of Lessor and made by or with Lessee or any Affiliate of Lessee, which default (i) relates to a failure to pay an amount of not less than One Million Dollars ($1,000,000) or (ii) is a material nonmonetary default (including, without limitation, any default that relates to a transfer or non-competition restriction, and/or to an environmental or licensing obligation).

16.2Certain Remedies. If an Event of Default shall have occurred, Lessor may terminate this Lease with respect to the Facility from which such Event of Default emanated, if any (provided, that any Event of Default that relates to Lessee’s performance hereunder generally and is not limited to circumstances at any specified Facility(ies), expressly including, without limitation, any Event of Default for failure to pay Minimum Rent, may be deemed by Lessor, in its reasonable discretion, to affect all Facilities). If at any time during the Term, Lessor has terminated this Lease with respect to a number of Facilities equal to seven percent (7%) or more (in the aggregate) of the number of Facilities then subject to this Lease pursuant to the first sentence of this Section 16.2, then if any additional Event(s)of Default shall occur thereafter, Lessor may terminate this Lease with respect to the Facility from which such Event of Default emanated, if any, or, if so elected by Lessor, with respect to all of the Facilities, regardless of the cause of nature of such Event of Default, by giving Lessee notice of such termination and the Term shall terminate and all rights of Lessee under this Lease shall cease with respect to all such Facilities as to which Lessor has elected to so terminate this Lease. Any such notice of termination may, at Lessor’s option, be given and exercised concurrently with any notice of Event of Default given by Lessor to Lessee hereunder. In such event, such termination shall be effective immediately upon the occurrence of the Event of Default subject to Legal Requirements, including, without limitation, any requirement that the occupant needs to be the holder of any applicable health care licenses. In addition to the foregoing, if any Event of Default pursuant to Section 16.1(g)or (h) shall occur, Lessor shall have the immediate right, at its election in its sole discretion, to terminate this Lease with respect to all of the Facilities. In all such events, Lessor shall have all rights at law and in equity available to Lessor as a result of any Event of Default. Lessee shall pay as Additional Charges all costs and expenses incurred by or on behalf of Lessor, including reasonable attorneys’ fees and expenses, as a result of any Event of Default hereunder. If an Event of Default shall have occurred and be continuing, whether or not this Lease has been terminated with respect to any one or more (including all, if so elected by Lessor and permitted in accordance with the terms hereof) of the Facilities pursuant to this Section 16.2, Lessee shall, to the extent permitted by law, if required by Lessor so to do, immediately surrender to Lessor possession of the Leased Property and any Capital Additions of the Facilities as to which Lessor has so elected to terminate this Lease and quit the same and Lessor may enter upon and repossess such Leased Property and such Capital Additions by reasonable force, summary proceedings, ejectment or otherwise, and may remove Lessee and all other Persons and any of Lessee’s Personal Property from such Leased Property and such Capital Additions.

16.3Damages. (i) The termination of this Lease with respect to any one or more of the Facilities; (ii) the repossession of the Leased Property and any Capital Additions of any Facility; (iii) the failure of Lessor, notwithstanding reasonable good faith efforts, to relet the Leased Property or any portion thereof; (iv) the reletting of all or any portion of the Leased Property; or (v) the failure or inability of Lessor to collect or receive any rentals due upon any such reletting, shall not relieve Lessee of its liabilities and obligations hereunder, all of which shall survive any such termination, repossession or reletting. In addition, the termination of this Lease with respect to any one or more of the

Facilities shall not relieve Lessee of its liabilities and obligations hereunder with respect to such terminated Facility(ies) that are intended to survive the termination of this Lease, including, without limitation, the obligations set forth in this Section 16.3 and Sections 16.5, 23.1, 37.4 and 45.1.8. If any such termination occurs,Lessee shall forthwith pay to Lessor all Rent due and payable with respect to the Facility(ies) terminated to and including the date of such termination. Thereafter, following any such termination, Lessee shall forthwith pay to Lessor, at Lessor’s option, as and for liquidated and agreed current damages for an Event of Default by Lessee, the sum of:

(a)the worth at the time of award of the unpaid Rent which had been earned at the time of termination with respect to the terminated Facility(ies),

(b)the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination with respect to the terminated Facility(ies) until the time of award exceeds the amount of such rental loss that Lessee proves could have been reasonably avoided,

(c)the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term for the terminated Facility(ies) after the time of award exceeds the amount of such rental loss that Lessee proves could be reasonably avoided, plus

(d)any other amount necessary to compensate Lessor for all the detriment proximately caused by Lessee’s failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom.

As used in clauses (a)and (b)above, the “worth at the time of award” shall be computed by allowing interest at the Overdue Rate. As used in clause (c)above, the “worth at the time of award” shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%).

Alternatively, if Lessor does not elect to terminate this Lease with respect to any Facility, then Lessee shall pay to Lessor, at Lessor’s option, as and for agreed damages for such Event of Default without termination of Lessee’s right to possession of the Leased Property and any Capital Additions or any portion thereof, each installment of said Rent and other sums payable by Lessee to Lessor under the Lease as the same becomes due and payable, together with interest at the Overdue Rate from the date when due until paid, and Lessor may enforce, by action or otherwise, any other term or covenant of this Lease.

16.4Receiver. Upon the occurrence of an Event of Default, and upon commencement of proceedings to enforce the rights of Lessor hereunder, Lessor shall be entitled, as a matter of right, to the appointment of a receiver or receivers acceptable to Lessor of the Leased Property and any Capital Additions of the revenues, earnings, income, products and profits thereof, pending the outcome of such proceedings, with such powers as the court making such appointment shall confer.

16.5Lessee’s Obligation to Purchase. Upon the occurrence of a Put Event with respect to any Facility or Facilities, Lessor shall be entitled to require Lessee to purchase the Leased Property of such Facility or Facilities on the first Minimum Rent Payment Date occurring not less than thirty (30) days after the date specified in a notice from Lessor requiring such purchase for an amount equal to the greater of (i) the Fair Market Value of such Facility(ies), or (ii) the Minimum Purchase Price of such Facility(ies), plus, in either event, all Rent then due andpayable (excluding any portion of the installment of Minimum Rent equal to the Allocated Minimum Rent for such Facility(ies) due on the purchase date) with respect to such Facility(ies). If Lessor exercises such right, Lessor shall convey the Leased Property of such Facility(ies) to Lessee on the date fixed therefor in accordance with the provisions of Article XVIII upon receipt of the purchase price therefor and this Lease shall thereupon terminate with respect to such Facility(ies). Any purchase by Lessee of the Leased Property of a Facility pursuant to this Section shall be in lieu of the damages specified in Section 16.3 with respect to such Facility.

16.6Waiver. If Lessor initiates judicial proceedings or if this Lease is terminated by Lessor pursuant to this Articlewith respect to a Facility, Lessee waives, to the extent permitted by applicable law, (i) any right of redemption, re-entry or repossession; and (ii) the benefit of any laws now or hereafter in force exempting property from liability for rent or for debt.

16.7Application of Funds. Any payments received by Lessor under any of the provisions of this Lease shall be applied to Lessee’s obligations in the order which Lessor may determine or as may be prescribed by the laws of the applicable State(s).

16.8Grant of Security Interest; Appointment of Collateral Agent. The parties intend that if an Event of Default occurs under this Lease, Lessor will, to the extent permitted by applicable law, control Lessee’s Personal Property and the Intangible Property (but excluding any of Lessee’s Personal Property or Intangible Property to the extent constituting (i) proprietary information, intellectual property, trademarks or tradenames of any Lessee Party or any Affiliate thereof, or (ii) any systems, software, contracts or other Personal Property of any Lessee Party or Affiliate thereof with respect to assets or facilities of any Lessee Party or Affiliate thereof in addition to the Facilities, collectively, “Lessee’s IP Intangibles”) so that Lessor or its designee or nominee can operate or re-let each Facility intact for its Primary Intended Use. Accordingly, to implement such intention, and for the purpose of securing the payment and performance obligations of Lessee hereunder, Lessor and Lessee agree as follows:

16.8.1Grant of Security Interest.

(a)Lessee, as debtor, hereby grants to Collateral Agent, as secured party, for the benefit of Lessor, a security interest and an express contractual lien upon all of Lessee’s right, title and interest in and to Lessee’s Personal Property and in and to the Intangible Property (but excluding Lessee’s IP Intangibles) and any and all products, rents, leases (including modification, extension, termination and other rights thereunder), issues, proceeds and profits thereof in which Lessee now owns or hereafter acquires an interest or right, including any leased Lessee’s Personal Property (other than Lessee’s IP Intangibles) (collectively, the “Collateral”). This Lease constitutes a security agreement covering all such Collateral. The security interest granted to Collateral Agent with respect to Lessee’s Personal Property in this Section 16.8 is intended by Lessor and Lessee to be subordinate to any security interest granted in connection with the financing or leasing of all or any portion of the Lessee’s Personal Property so long as the lessor or financier of such Lessee’s Personal Property agrees to give Lessor written notice of any default by Lessee under the terms of such lease or financing arrangement, to give Lessor a reasonable time following such notice to cure any such default and consents to Lessor’s written assumption of such lease or financing arrangement upon Lessor’s curing of any suchdefaults. This clause shall be self-operative and no further instrument of subordination shall be required. This security agreement and the security interest created herein shall survive the expiration or earlier termination of this Lease with respect to any or all of the Facilities.

(b)Lessee hereby authorizes Collateral Agent to file such financing statements, continuation statements and other documents as may be necessary or desirable to perfect or continue the perfection of Collateral Agent’s security interest in the Collateral. In addition, if required by Collateral Agent at any time during the Term, Lessee shall execute and deliver to Collateral Agent, in form reasonably satisfactory to Collateral Agent, additional security agreements, financing statements, fixture filings and such other documents as Collateral Agent may reasonably require to perfect or continue the perfection of Collateral Agent’s security interest in the Collateral. In the event Lessee fails to execute any financing statement or other documents for the perfection or continuation of Collateral Agent’s security interest, Lessee hereby appoints Collateral Agent as its true and lawful attorney-in-fact to execute any such documents on its behalf, which power of attorney shall be irrevocable and is deemed to be coupled with an interest.

(c)Lessee will give Collateral Agent at least thirty (30) days’ prior written notice of any change in Lessee’s name, identity, jurisdiction of organization or corporate structure. With respect to any such change, Lessee will promptly execute and deliver such instruments, documents and notices and take such actions, as Collateral Agent deems necessary or desirable to create, perfect and protect the security interests of Collateral Agent in the Collateral.

(d)Upon the occurrence and during the continuance of an Event of Default, Collateral Agent shall, to the extent permitted by applicable law, be entitled to exercise any and all rights or remedies available to a secured party under the Uniform Commercial Code, or available to a lessor under the laws of the State, with respect to Lessee’s Personal Property and the Intangible Property, including the right to sell the same at public or private sale.

16.8.2Appointment of Collateral Agent.

(a)Each Person comprising “Lessor” hereunder hereby irrevocably appoints HCP (the “Collateral Agent”) as the collateral agent hereunder and under all other documents related hereto and authorizes Collateral Agent in such capacity, to take such actions on its behalf and to exercise such powers as are delegated to Collateral Agent in such capacity by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. In performing its functions and duties hereunder, Collateral Agent shall act for itself and as agent for each Person comprising “Lessor” hereunder and does not assume and shall not be deemed to have assumed any obligation towards or relationship of agency or trust with or for Lessee. The provisions of this Section 16.8.2 are solely for the benefit of Collateral Agent and each Person comprising “Lessor” hereunder, and Lessee shall have no rights as a third party beneficiary(ies) of any of such provisions.

(b)The Collateral Agent may perform any and all of its duties and exercise its rights and powers hereunder by or through any one or more sub-agents appointed by the Collateral Agent.

(c)The Collateral Agent may at any time give notice of its resignation to the Persons comprising “Lessor” hereunder and Lessee. Upon receipt of any such notice of resignation, the Persons comprising “Lessor” hereunder shall have the right to appoint a successor Collateral Agent. If no such successor shall have been so appointed by the Persons comprising “Lessor” hereunder and shall have accepted such appointment within ten (10)days after the retiring Collateral Agent gives notice of its resignation, then the retiring Collateral Agent may, on behalf of each Person comprising “Lessor” hereunder, appoint a successor Collateral Agent; provided that if the Collateral Agent shall notify Lessee and each Person comprising “Lessor” hereunder that no such successor is willing to accept such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (i) the retiring Collateral Agent shall be discharged from its duties and obligations hereunder (except that in the case of any Collateral held by the Collateral Agent on behalf of each Person comprising “Lessor” hereunder, the Collateral Agent may continue to hold such Collateral until such time as a successor Collateral Agent is appointed and such Collateral is assigned to such successor Collateral Agent) and (ii) all payments, communications and determinations provided to be made by, to or through the Collateral Agent shall instead be made by or to each Person comprising “Lessor” hereunder directly, until such time as the Persons comprising “Lessor” hereunder appoint a successor Collateral Agent.

(d)Upon the acceptance of a successor’s or replacement’s appointment as Collateral Agent, such successor or replacement shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Collateral Agent and the retiring Collateral Agent shall be discharged from all of its duties and obligations hereunder. After the retiring Collateral Agent’s resignation hereunder, the provisions of this Section 16.9.2 shall continue in effect for the benefit of such retiring Collateral Agent and its sub-agents in respect of any actions taken or omitted to be taken by any of them while the retiring Collateral Agent was acting in such capacity.

16.9Leases and Residential Care Agreements. Lessee shall comply with and observe in all material respects Lessee’s obligations under all leases and residential care agreements, including Lessee’s obligations pertaining to the maintenance and disposition of resident or tenant security deposits (provided, however, that no breach of Lessee’s obligations with respect to such leases and residential care agreements shall constitute a default hereunder until and unless any such breaches or defaults affect a material number of the leases and residential care agreements at any one Facility). Upon delivery of notice by Lessor or Collateral Agent to Lessee of Lessor’s or Collateral Agent’s exercise of its respective rights under this Article, at any time during the continuance of an Event of Default, and without the necessity of Lessor or Collateral Agent entering upon and taking and maintaining control of any Facility directly, by a receiver, or by any other manner or proceeding permitted by applicable law, Lessor and/or Collateral Agent immediately shall have, to the extent permitted by applicable law, all rights, powers and authority granted to Lessee under any lease or residential care agreement relating to such Facility, including the right, power and authority to modify the terms of any such lease or residential care agreement for such Facility, or extend or terminate any such lease or residential care agreement for such Facility. During the continuance of an Event of Default, unless Lessor and/or Collateral Agent elects in its sole discretion to assume the obligations of Lessee under any lease or residential care agreement for any Facility, neither Lessor norCollateral Agent shall (i) be obligated to perform any of the terms, covenants or conditions contained in such lease or residential care agreement relating to such Facility (or otherwise have any obligation with respect to such lease or residential care agreement relating to such Facility) or (ii) be obligated to appear in or defend any action or proceeding relating to such lease or residential care agreement relating to such Facility. Notwithstanding anything to the contrary in this Section 16.9, but subject to the other terms and conditions contained in this Lease, except during the continuance of an Event of Default, Lessee shall be entitled to exercise any and all rights under any Occupancy Arrangements relating to any Facility, including Lessee’s right, power and authority to modify the terms of any such Occupancy Arrangements or extend or terminate such Occupancy Arrangements.

ARTICLE XVII.

17.1Lessor’s Right to Cure Lessee’s Default. If Lessee shall fail to make any payment or to perform any material act required to be made or performed hereunder, Lessor (following the occurrence and during the continuance of any Event of Default), without waiving or releasing any obligation or default, may (upon written notice to Lessee), but shall be under no obligation to, make such payment or perform such act for the account and at the expense of Lessee, and may, to the extent permitted by law, enter upon the Leased Property and any Capital Addition, during normal business hours and upon prior notice to Lessee (except in the case of any emergency), for such purpose and take all such action thereon as, in Lessor’s opinion, may be necessary or appropriate therefor. No such entry shall be deemed an eviction of Lessee. All sums so paid by Lessor and all out-of-pocket costs and expenses, including reasonable attorneys’ fees and expenses, so incurred, together with interest thereon at the Overdue Rate from the date on which such sums or expenses are paid or incurred by Lessor, shall be paid by Lessee to Lessor on demand.

ARTICLE XVIII.

18.1Purchase of the Leased Property. If Lessee purchases the Leased Property of any Facility from Lessor pursuant to any provisions of this Lease, Lessor shall, upon receipt from Lessee of the applicable purchase price, together with full payment of any unpaid Rent due and payable with respect to any period ending on or before the date of the purchase, deliver to Lessee an appropriate special or limited warranty deed conveying the entire interest of Lessor in and to such Leased Property to Lessee free and clear of all encumbrances other than (i) those that Lessee has agreed hereunder to pay or discharge; (ii) those mortgage liens, if any, which Lessee has agreed in writing to accept and to take title subject to; (iii) those liens and encumbrances which were in effect on the date of conveyance of such Leased Property to Lessor; and (iv) any other encumbrances permitted hereunder to be imposed on such Leased Property which are assumable at no cost to Lessee or to which Lessee may take subject without cost to Lessee or material interference with the use or operations of the applicable Facility for its Primary Intended Use. The applicable purchase price, less the total amount of the encumbrances assumed or taken subject to which can be satisfied by the payment of money (other than any financing provided by Lessor for the purchase of the applicable Leased Property), shall be paid to Lessor or as Lessor may direct in immediately available funds. All reasonable out-of-pocket expenses of such conveyance, including the cost of title insurance, attorneys’ fees incurred by Lessor inconnection with such conveyance and release, transfer taxes and recording and escrow fees, shall be paid by Lessee.

18.2Rights of Lessee Prior to Closing. Notwithstanding anything to the contrary in this Lease, or at law or in equity, if Lessor shall exercise its right to require Lessee to purchase the Leased Property of any Facility pursuant to Section 16.5 (a “Purchase Obligation Exercise”), the following shall pertain:

(a)Such Purchase Obligation Exercise (and any purchase or other separate contract formed upon such Purchase Obligation Exercise) shall not under any circumstances cause a termination of this Lease with respect to such Facility, and this Lease shall remain in full force and effect with respect to such Facility to and until the consummation of the closing in accordance with the terms thereof;

(b)Lessee hereby acknowledges and agrees that Lessee shall not under any circumstances be entitled to possession of the Leased Property of any Facility under the terms of any purchase or other separate contract formed upon such Purchase Obligation Exercise until the closing thereof, and that, prior thereto, Lessee’s possession of the Leased Property of such Facility shall be solely by way of this Lease;

(c)In no event shall Lessee be deemed a vendee in possession; and

(d)In the event that an Event of Default relating to the subject Facility shall occur at any time during the period from such Purchase Obligation Exercise to and until closing, Lessor shall be entitled to exercise

any and all rights or remedies available to a landlord against a defaulting tenant, whether at law or equity, including those set forth in Article XVI hereof, and specifically including the right to recover possession of the Leased Property of such Facility through summary proceedings (such as unlawful detainer or other similar action permitted by law), and in no event shall Lessor be required to bring an action for ejectment or any other similar non-expedited proceeding.

18.3Lessor’s Election of 1031 Exchange; Lessee’s Regulatory Filings. If Lessee purchases the Leased Property of any Facility from Lessor pursuant to any provision of this Lease, Lessor may elect to sell the Leased Property to Lessee in the form of a tax-deferred exchange pursuant to Section 1031 of the Internal Revenue Code of 1986, as amended (“1031 Exchange”). In the event that Lessor shall so elect, Lessor shall give written notice to Lessee and any escrow holder of such election and the following shall apply:

(a)Lessor may attempt to identify before the closing other property which qualifies as “like-kind” property for a 1031 Exchange (the “Target Property”) by giving written notice to Lessee and any escrow holder and identifying to such escrow holder the Target Property prior to the closing.

(b)If Lessor has not so identified the Target Property before the closing, then Lessor shall proceed with the closing unless Lessor at its option enters into an exchange agreement with an accommodation party (“Accommodator”) in order to facilitate a non-simultaneous exchange. If an Accommodator is so designated, Lessor shall cause theAccommodator (i) to acquire title to the Leased Property from Lessor at or before the closing and, (ii) to transfer title in the Leased Property to Lessee on closing for the applicable purchase price.

(c)Lessee shall fully cooperate with any such 1031 Exchange, including but not limited to executing and delivering additional documents requested or approved by Lessor; provided, that Lessee shall not be required to incur any additional costs or liabilities or financial obligation as a consequence of any of the foregoing exchange transactions.

(d)Lessor hereby agrees to reasonably cooperate (at no cost to Lessor) with Lessee in connection with the satisfaction of disclosure and reporting obligations of Lessee arising pursuant to applicable Legal Requirements. Notwithstanding anything to the contrary contained in this Lease, it is hereby understood and agreed that if an Event of Default results from Lessor’s failure, following Lessee’s written request therefor pursuant to the provisions of Section 10.2.6 hereof, to provide information necessary to be disclosed or otherwise required by Legal Requirements, then the Event of Default that would otherwise occur shall be deemed not to exist under this Lease to the extent resulting from any such failure of Lessor. Lessee and Lessor agree to reasonably cooperate to limit any such disclosure requirements pursuant to Legal Requirements to the extent Lessor objects to same.

ARTICLE XIX.

19.1Extended Terms.

(a)Provided that no Event of Default, or event which, with notice or lapse of time or both, would constitute a monetary Event of Default, has occurred and is continuing, either at the date of exercise or upon the commencement of an Extended Term, Lessee shall have the right (subject to Section 19.1(c)) to renew this Lease with respect to all (but not less than all) of, respectively, the Pool 1 Facilities, the Pool 2 Facilities and the Pool 3 Facilities then covered by this Lease for the Extended Terms for such Facilities set forth on Exhibit X-0, Xxxxxxx X-0 and Exhibit A-3 attached hereto. Each renewal option shall be exercised, if at all, by Lessee (i) giving written notice to Lessor of such renewal not less than eighteen (18) months prior to the expiration of the applicable then-current Term, (ii) delivering (if the Guaranty is, at the time of such notice, required to be in place pursuant to this Lease) to Lessor, concurrently with the delivery of the notice described in clause (i) hereof, a reaffirmation of the Guaranty executed by the Guarantor stating, in substance, that the Guarantor’s obligations under such Guaranty shall extend to this Lease, as extended by the subject Extended Term (but Lessor may, at its sole and absolute discretion, waive this requirement), and (iii) with respect to any facility(ies) subject to a New Lease hereafter with or in favor of Lessor or any Affiliate of Lessor, the exercise by the “Lessee” thereunder of the renewal of each such New Lease or other lease for the corresponding and co-terminus “Extended Term” thereof, concurrently with the delivery of the notice described in clause (i) hereof. Lessee’s exercise of any renewal option hereunder shall be irrevocable and immediately binding upon Lessee as of the date that Lessee delivers the applicable notices and reaffirmations pursuant to the foregoing items (i)through (iii). As of the date hereof, the parties agree that the Term of this Lease including all Extended Terms does not exceed 80% of the estimated remaining useful life of any Facility. During eachExtended Term, all of the terms and conditions of this Lease shall continue in full force and effect.

(b)Intentionally Omitted.

(c)Notwithstanding anything to the contrary in Section 19.1(a), Lessor, in its sole discretion, may waive the condition to Lessee’s right to renew this Lease that no Event of Default, or event which, with notice or lapse of time or both, would constitute a monetary Event of Default, has occurred or is continuing, and the same may not be used by Lessee as a means to negate the effectiveness of Lessee’s exercise of its renewal right for such Extended Term.

ARTICLE XX.

20.1Holding Over. If Lessee shall for any reason remain in possession of any portion of the Leased Property and/or any Capital Additions after the expiration or earlier termination of the Term, such possession shall be as a month-to-month tenant during which time Lessee shall pay as Minimum Rent for each month an amount equal to one hundred fifty percent (150%) of the monthly Minimum Rent applicable to the prior Lease Year, together

with all Additional Charges and all other sums payable by Lessee pursuant to this Lease. During such period of month-to-month tenancy, Lessee shall be obligated to perform and observe all of the terms, covenants and conditions of this Lease, but shall have no rights hereunder other than the right, to the extent given by law to month-to-month tenancies, to continue its occupancy and use of the Leased Property and/or any Capital Additions. Nothing contained herein shall constitute the consent, express or implied, of Lessor to the holding over of Lessee after the expiration or earlier termination of this Lease.

ARTICLE XXI.

21.1General REIT Provisions. Lessee acknowledges that, in order for Lessor and/or Lessor’s Affiliates to qualify as a REIT, certain REIT Requirements must be satisfied, including, without limitation, the provisions of Section 856 of the Code. Accordingly, Lessee agrees, and agrees to cause its Affiliates, Occupants and any other parties subject to its control by ownership or contract, to cooperate reasonably with Lessor to ensure that the REIT Requirements are satisfied, including, but not limited to, providing Lessor with information about the ownership of Lessee and its Affiliates; provided, that such cooperation shall not result in any unreimbursed cost or other adverse consequence to Lessee. Lessee agrees, and agrees to cause its Affiliates, upon request by Lessor, to take all action reasonably necessary to ensure compliance with the REIT Requirements; provided, that such actions shall not result in any unreimbursed cost or other adverse consequence to Lessee.

21.2REIT Agreements. Lessor and Lessee agree that (a) rents payable under this Lease are not based in whole or in part on the income or profits of any Person; (b) as of the date this Lease was entered into or modified, rents payable under this Lease were set at a fair market rental amount or formula, and there was a reasonable expectation that Lessee had the financial wherewithal to make the payments required; and (c) no services or amenities are provided to Lessee under this Lease, other than services that are both (1) customarily furnishedor rendered by or on behalf of Lessor in connection with the rental of real property of a similar class in the geographic areas in which the relevant property is located and (2) customarily furnished or rendered in connection with the rental of space for occupancy only (as opposed to primarily for the convenience of the tenant).

ARTICLE XXII.

22.1Risk of Loss. During the Term, the risk of loss or of decrease in the enjoyment and beneficial use of the Leased Property and any Capital Additions as a consequence of the damage or destruction thereof by fire, the elements, casualties, thefts, riots, wars or otherwise, or in consequence of foreclosures, attachments, levies or executions (other than by Lessor and Persons claiming from, through or under Lessor) is assumed by Lessee, and no such event shall entitle Lessee to any abatement of Rent.

ARTICLE XXIII.

23.1General Indemnification. In addition to the other indemnities contained herein, and notwithstanding the existence of any insurance carried by or for the benefit of Lessor or Lessee, and without regard to the policy limits of any such insurance, Lessee shall protect, indemnify, save harmless and defend Lessor and its Affiliates from and against all liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses, including reasonable attorneys’, consultants’ and experts’ fees and expenses, imposed upon or incurred by or asserted against Lessor or any of its Affiliates by reason of: (i) any accident, injury to or death of Persons or loss of or damage to property occurring on or about the Leased Property, or any Capital Additions or adjoining sidewalks thereto; (ii) any use, misuse, non-use, condition, maintenance or repair by Lessee of the Leased Property or any Capital Additions; (iii) any failure on the part of Lessee to perform or comply with any of the terms of this Lease; (iv) the non-performance of any of the terms and provisions of any and all existing and future subleases of the Leased Property or any Capital Additions to be performed by any party thereunder; (v) any claim for malpractice, negligence or misconduct committed by any Person on or working from the Leased Property or any Capital Additions; and (vi) the violation of any Legal Requirement (the foregoing (i)through (vi), collectively, the “Indemnified Liabilities”). Notwithstanding anything to the contrary contained in the above, Lessee shall not have any obligation hereunder to the extent that such Indemnified Liabilities arise solely from the negligence, illegal acts, fraud or willful misconduct of Lessor or any of its Affiliates. Any amounts which become payable by Lessee under this Articleshall be paid within ten (10)Business Days after liability therefor is finally determined in a non-appealable judgment by litigation or otherwise, and if not timely paid shall bear interest at the Overdue Rate from the date of such determination to the date of payment. Lessee, at its sole cost and expense, shall contest, resist and defend any such claim, action or proceeding asserted or instituted against Lessor or any of its Affiliates for which Lessee is obligated to indemnify Lessor or such Affiliate pursuant to this Article XXIII or any other provision of this Lease and may settle compromise or otherwise dispose of the same as Lessee sees fit; provided, however, that any legal counsel selected by Lessee to defend Lessor or such Affiliate shall be reasonably satisfactory to Lessor, and, if required by Lessor, any such counsel retained by Lessee to defend Lessor or such Affiliate shall be separate, independent counsel from any counsel selected by Lessee to defend Lessee; provided further, however, that, withoutLessor’s prior written consent, which consent may be given or withheld in Lessor’s sole and absolute discretion, Lessee shall not enter into any settlement agreement with respect to, or compromise or otherwise dispose of any such claim, action or proceeding asserted or instituted against Lessor for which Lessee is obligated to indemnify Lessor or any of its Affiliates pursuant to this Articleor any other provision of this Lease if such settlement, compromise or disposition thereof requires any performance by Lessor or any of its Affiliates (other than the payment of money which shall be paid by Lessee) or would impose any restrictions or other covenants upon Lessor, any of its Affiliates or the Leased Property. All indemnification covenants set forth in this Articleor elsewhere in this Lease are intended to apply to losses, damages, injuries, claims,etc. incurred directly by the indemnified parties and their property, as well as by the indemnifying party or third party, and their property. For purposes of this Articleand the other indemnification obligations of Lessee under this Lease, any acts or omissions of Lessee, or by employees, agents, assignees, contractors, subcontractors or others acting for or on behalf of Lessee (whether or not they are negligent, intentional, willful or

unlawful), shall be strictly attributable to Lessee. It is understood and agreed that payment shall not be a condition precedent to enforcement of the foregoing indemnification obligations or any of the other indemnification obligations of Lessee set forth in this Lease.

ARTICLE XXIV.

24.1Transfers.

24.1.1Prohibition. Subject to the provisions of Sections 24.1.8, 24.1.10, 24.1.11 and 24.1.12 below, Lessee shall not, without Lessor’s prior written consent, which consent may not be unreasonably withheld, conditioned or delayed (except as provided in the last sentence of this Section 24.1.1), either directly or indirectly or through one or more step transactions or tiered transactions, voluntarily or by operation of law, (i) assign, convey, sell, pledge, mortgage, hypothecate or otherwise encumber, transfer or dispose of all or any part of this Lease or Lessee’s leasehold estate hereunder, (ii) Master Sublease all or any part of the Leased Property and/or any Capital Additions of any Facility, (iii) enter into an agreement with any Person that is not an Affiliate of Lessee for the management or operation of more than ten percent (10%) of the Leased Property and/or any Capital Additions of any Facility, (iv) convey, sell, assign, transfer or dispose of any stock or partnership, membership or other interests (whether equity or otherwise) in Lessee (which shall include any conveyance, sale, assignment, transfer or disposition of any stock or partnership, membership or other interests (whether equity or otherwise) in any Controlling Person(s)), if such conveyance, sale, assignment, transfer or disposition results in a change in control of Lessee (or in any Controlling Person(s)), (v) dissolve, merge or consolidate Lessee (which shall include any dissolution, merger or consolidation of any Controlling Person) with any other Person, if such dissolution, merger or consolidation results in a change in control of Lessee or in any Controlling Person(s), (vi) sell, convey, assign, or otherwise transfer all or substantially all of the assets of Lessee (which shall include any sale, conveyance, assignment, or other transfer of all or substantially all of the assets of any Controlling Person) or (vii) consummate or permit to be consummated any agreement to do any of the foregoing (each of the aforesaid acts referred to in clauses (i)through (vii) being referred to herein as a “Transfer”). Lessor’s consent shall not be required for any Occupancy Arrangement transaction that does not constitute a Master Sublease or for the engagement of the services of any Person for the management or operation of ten percent (10%) or less of theLeased Property and/or any Capital Additions of any Facility. With respect to any such Occupancy Arrangement or engagement for which such consent is not required, Lessee shall, within ten (10)days of entering into any such Occupancy Arrangement or engagement, notify Lessor of the existence of such Occupancy Arrangement or engagement and the identity of the Occupant or manager, as the case may be, and supply Lessor with a copy of the agreement relating to such Occupancy Arrangement or engagement and any other related documentation, materials or information reasonably requested by Lessor; provided, however, that the foregoing shall not apply to any Occupancy Arrangement for patients or residents of any Facility (i.e., any non-Commercial Occupancy Arrangements). Notwithstanding the foregoing or any other provisions of this Lease to the contrary, Lessee acknowledges that (x) it is Lessor’s practice not to permit any mortgages, hypothecations, pledges or other encumbrances of leasehold interests by its lessees, and (y) Lessor shall have the right to approve or disapprove of any such mortgage, hypothecation, pledge or other encumbrance of the leasehold estate created hereby by Lessee (whether directly or indirectly) in Lessor’s sole and absolute discretion, and (z) if Lessor shall approve the same Lessor shall be entitled to impose such conditions in connection therewith as Lessor deems appropriate in its sole and absolute discretion.

24.1.2Consent.

24.1.2.1Prior to consummating any Transfer, Lessee shall submit in writing to Lessor, as applicable: (i) the name of the proposed Occupant, assignee, manager or other transferee; (ii) the terms and provisions of the Transfer, including any agreements in connection therewith; and (iii) such financial information as Lessor may reasonably request concerning the proposed Occupant, assignee, manager or other transferee. In exercising its right of reasonable approval or disapproval to a proposed Transfer, Lessor shall be entitled to take into account any fact or factor that is commercially reasonable to the making of such decision, including the following, all of which are agreed to be reasonable factors for Lessor’s consideration:

(a)The financial strength of the proposed Occupant, assignee, manager or other transferee, including the adequacy of its working capital. In connection with a Transfer resulting from a merger or consolidation to which Lessee or any Guarantor or Controlling Party is a party, Lessor shall be entitled to compare the Consolidated Net Worth and debt to equity ratio of the surviving party following the effectiveness of such event as compared to the Consolidated Net Worth and debt-to-equity ratio of Lessee or such Controlling Party, as applicable, prior to such event.

(b)The operating experience of the proposed Occupant, assignee, manager or other transferee with respect to businesses of the nature, type and size of the applicable Facility.

(c)The quality and reputation of the proposed Occupant, assignee, manager or other transferee.

(d)Whether such Transfer will cause a breach or violation of any material agreements to which Lessee or any Controlling Person is a party.

(e)Whether there then exists any uncured Event of Default by Lessee pursuant to this Lease; provided, however, that if (A) Lessee is proposing to enter into a Master Sublease with respect to one or more Facilities, (B) there is no uncured monetary Event of Default under this Lease, (C) a non-monetary Event of Default has occurred at another Facility (i.e., a Facility that Lessee is not proposing to Master Sublease), Lessor has not yet exercised any of its rights or remedies on account thereof pursuant to Article XVI hereof, and Lessee is diligently and in good faith

proceeding to cure such non-monetary Event of Default at such other Facility, then Lessor shall not take the same into account as the sole basis for withholding its consent to any such proposed Master Sublease of such other Facility(ies).

Moreover, Lessor shall be entitled to be reasonably satisfied that neither any covenant, condition or obligation imposed upon Lessee by this Lease nor any right, remedy or benefit afforded Lessor by this Lease is materially impaired or diminished by such Transfer. Lessee acknowledges, however, that any proposed partial assignment, conveyance, sale, transfer or other disposition of this Lease or Lessee’s leasehold estate hereunder with respect to less than all of the Facilities would materially impair the covenants, conditions and obligations imposed upon Lessee by this Lease and the rights, remedies and benefits afforded Lessor by this Lease as a single, integrated and indivisible agreement and economic unit with respect to all Facilities, and therefore it would be reasonable for Lessor to withhold its consent to any such partial assignment, conveyance, sale, transfer or other disposition of this Lease or Lessee’s leasehold estate hereunder with respect to less than all the Facilities on such basis.

24.1.2.2In connection with any Transfer, Lessor shall be entitled to receive the applicable Transfer Consideration, if any.

In connection with any Transfer, Lessor shall be entitled to require as a condition to any such Transfer that the obligations of any Occupant, assignee, manager or other transferee that is a subsidiary of and/or Controlled by another Person or Persons, be guaranteed by the entity or entities constituting the ultimate parent(s)and/or other ultimate Controlling Person(s), as the case may be, pursuant to a written guaranty in form and substance reasonably acceptable to Lessor and that, subject to Section 24.1.3 below, any existing Guaranty of this Lease be reaffirmed by the applicable Guarantor notwithstanding such Transfer.

24.1.2.3The foregoing provisions of this Section 24.1.2 shall not apply to any Transfer permitted under Section 24.1.10, 24.1.11 or 24.1.12 below, which shall be governed by the provisions thereof (but shall be subject to Section 24.1.8).

24.1.2.4The consent by Lessor to any Transfer shall not constitute Lessor’s consent to any subsequent Transfer or to any subsequent or successive Transfer. Any purported or attempted Transfer contrary to the provisions of this Articleshall be void and, at the option of Lessor, shall terminate this Lease.

24.1.3Release of Existing Lessee and Guarantors Upon Certain Transfers. Upon the consummation of any Transfer by Lessee that (a) constitutes an assignment of Lessee’s entire interest in this Lease, (b) requires Lessor’s prior written consent pursuant to the terms of this Article XXIV, and (c) receives such prior written consent by Lessor, Lessor shall release Lessee and any current Guarantor from all obligations arising under this Lease andany current Guaranty, as applicable, following the effective date of such Transfer, so long as each of the following conditions is met:

24.1.3.1The Consolidated Net Worth of the assignee or replacement Guarantor, as the case may be, immediately following the effectiveness of such Transfer, shall be equal to or greater than the Consolidated Net Worth of Brookdale as of the Commencement Date.

24.1.3.2The debt-to-equity ratio of the assignee following the effectiveness of such Transfer shall be equal to or less than the debt-to-equity ratio of Brookdale as of the Commencement Date. For purposes of this Section 24.1.3.2, “debt” shall include (without limitation) the capitalized value of any leases required to be capitalized in accordance with GAAP to which Brookdale and/or such assignee (and/or their consolidated Subsidiaries) are parties and the same shall be demonstrated by financial statements prepared in accordance with GAAP and reasonably satisfactory to Lessor.

24.1.3.3The assignee shall have adequate experience and skill in (i) operating facilities comparable to the applicable Facility(ies) and (ii) a business of the nature, type and size of the business of Brookdale immediately prior to the effectiveness of such Transfer, as determined by Lessor in its reasonable discretion. Such assignee shall be deemed to have “adequate experience and skill” if (A) the core management team that will be managing the lessee under this Lease immediately following the effectiveness of such Transfer has an average of not less than three (3) years’ operating experience with respect to the operation and management of senior living or health care facilities, or (B) such assignee or a Controlling Person of such assignee, as the case may be, shall immediately following the effectiveness of such Transfer, and for a period of not less than one (1) year thereafter, directly or indirectly retain and/or hire in a full-time management or consulting capacity a majority of the principal officers of Brookdale who were in the employment of Brookdale prior to the effectiveness of such Transfer.

24.1.4Attornment and Related Matters. Any Commercial Occupancy Arrangement (including any Master Sublease) or the engagement of any Person for the management or operation of all or any portion of the Leased Property shall be expressly subject and subordinate to all applicable terms and conditions of this Lease. With respect to any Commercial Occupancy Arrangement or any such management agreement, Lessor, at its option and without any obligation to do so, may require any Occupant under any such Commercial Occupant Arrangement or manager to attorn to Lessor upon the expiration or earlier termination of this Lease or (at Lessor’s election) upon the occurrence and during the continuance of an Event of Default, in which event Lessor shall undertake the obligations of Lessee, as sublessor, licensor or otherwise under such Commercial Occupancy Arrangement or management engagement from the time of the exercise of such option to the termination of such Commercial Occupancy Arrangement or management engagement and in such case Lessor shall not be liable for any prepaid rents, fees or other charges or for any prepaid security deposits paid by such Occupant under any such Commercial Occupant Arrangement to Lessee or for any other prior defaults of Lessee under such Commercial Occupancy Arrangement or management engagement. In the event that Lessor shall not require such attornment with respect to any such Commercial Occupancy Arrangement or

management engagement, then such CommercialOccupancy Arrangement or management engagement shall automatically terminate upon the expiration or earlier termination of this Lease, including any early termination by mutual agreement of Lessor and Lessee. Furthermore, any such Commercial Occupancy Arrangement, management engagement or other agreement regarding a Transfer shall expressly provide that the Occupant, assignee, manager or other transferee shall furnish Lessor with such financial, operational or other information about the physical condition of the applicable Facility, including the information required by Section 25.1.2 herein, as Lessor may request from time to time.

24.1.5Assignment of Lessee’s Rights Against Occupant Under a Master Sublease. If Lessor shall consent to a Master Sublease, then the written instrument of consent, executed and acknowledged by Lessor, Lessee and the Occupant under such Master Sublease, as the case may be, shall contain a provision substantially similar to the following:

24.1.5.1Lessee and such Occupant hereby agree that, if such Occupant shall be in default of any of its obligations under the Master Sublease, which default also constitutes an Event of Default by Lessee under this Lease (subject to the express provisions of Section 16.9 hereof), then Lessor shall be permitted to avail itself of all of the rights and remedies available to Lessee against such Occupant in connection therewith.

24.1.5.2Without limiting the generality of the foregoing, upon the occurrence and during the continuance of an Event of Default, Lessor shall be permitted (by assignment of a cause of action or otherwise) to institute an action or proceeding against such Occupant in the name of Lessee in order to enforce Lessee’s rights under the Master Sublease, and also shall be permitted to take all ancillary actions (e.g., serve default notices and demands) in the name of Lessee as Lessor reasonably shall determine to be necessary.

24.1.5.3Lessee agrees to cooperate with Lessor, and to execute such documents as shall be reasonably necessary, in connection with the implementation of the foregoing rights of Lessor.

24.1.5.4Lessee expressly acknowledges and agrees that the exercise by Lessor of any of the foregoing rights and remedies shall not constitute an election of remedies, and shall not in any way impair Lessor’s entitlement to pursue other rights and remedies directly against Lessee.

24.1.6Costs. Lessee shall reimburse Lessor for Lessor’s reasonable costs and expenses incurred in conjunction with the processing and documentation of any request for consent as required under this Article XXIV, including reasonable attorneys’, architects’, engineers’ or other consultants’ fees whether or not the transaction for which consent is requested is actually consummated.

24.1.7No Release of Lessee’s Obligations. Except as expressly set forth in Section 24.1.3 above, no Transfer shall relieve Lessee of its obligation to pay the Rent and to perform all of the other obligations to be performed by Lessee hereunder. Except as expressly set forth in Section 24.1.3 above, the liability of Lessee named herein and any immediate and remote successor in interest of Lessee with respect to its interest in this Lease (i.e., by means of any Transfer), and the due performance of the obligations of this Lease onLessee’s part to be performed or observed, shall not in any way be discharged, released or impaired by any (i) agreement which modifies any of the rights or obligations of the parties under this Lease, (ii) stipulation which extends the time within which an obligation under this Lease is to be performed, (iii) waiver of the performance of an obligation required under this Lease, or (iv) failure to enforce any of the obligations set forth in this Lease. Except as expressly set forth in Section 24.1.3 above, if any such Occupant, assignee, manager or other transferee defaults in any performance due hereunder, Lessor may proceed directly against the Lessee named herein and/or any immediate and remote successor in interest of Lessee without exhausting its remedies against such Occupant, assignee, manager or other transferee.

24.1.8REIT Protection. Anything contained in this Lease to the contrary notwithstanding, based on the reasonable advice of Lessor’s outside counsel (i) no Transfer shall be consummated on any basis such that rental or other amounts to be paid by the Occupant, assignee, manager or other transferee thereunder would be based, in whole or in part, on the income or profits derived by the business activities of the Occupant, assignee, manager or other transferee; (ii) Lessee shall not furnish or render any services to an Occupant, assignee, manager or other transferee with respect to whom Transfer Consideration is required to be paid or manage or operate the Leased Property and/or any Capital Additions so Transferred with respect to which Transfer Consideration is being paid; and (iii) Lessee shall not consummate a Transfer with any Person in which Lessor owns an interest, directly or indirectly (by applying constructive ownership rulesset forth in Section 856(d)(5)of the Code); and (iv) Lessee shall not consummate a Transfer with any Person or in any manner which could cause any portion of the amounts received by Lessor pursuant to this Lease or any Occupancy Arrangement to fail to qualify as “rents from real property” within the meaning of Section 856(d)of the Code, or any similar or successor provision thereto or which could cause any other income of Lessor to fail to qualify as income described in Section 856(c)(2)of the Code. Lessee shall provide such information as Lessor’s outside counsel may reasonably request to provide its advice regarding the foregoing, and in rendering such advice, Lessor’s counsel shall be entitled to rely on factual representations from Lessee and Lessor; provided, however, that Lessee shall have no liability therefor if Lessee has provided such information and representations in good faith and after a reasonably diligent review and inquiry of the subject matter thereof. The requirements of this Section 24.1.8 shall likewise apply to any further Transfers by a transferee.

24.1.9Transfers In Bankruptcy. It is the intent of the parties hereto that in the event of a Transfer pursuant to the provisions of the Bankruptcy Code, all consideration payable or otherwise to be delivered in connection with such Transfer shall be paid or delivered to Lessor, shall be and remain the exclusive property of Lessor and shall not constitute property of Lessee or of the estate of Lessee within the meaning of the Bankruptcy Code. Any consideration constituting Lessor’s property pursuant to the immediately preceding sentence and not paid or delivered to

Lessor shall be held in trust for the benefit of Lessor and be promptly paid or delivered to Lessor. For purposes of this Section 24.1.9, the term “consideration” shall mean and include money, services, property and any other thing of value such as payment of costs, cancellation or forgiveness of indebtedness, discounts, rebates, barter and the like. If any such consideration is in a form other than cash (such as in kind, equity interests, indebtedness earn-outs, or other deferred payments, consulting or management fees,etc.) Lessor shall be entitled to receive in cash the then present fair market value of such consideration. Notwithstanding any provision of this Lease to the contrary, including thisSection 24.1.9, it is expressly understood and agreed that it is the intention of the parties hereto that, notwithstanding any provision of the Bankruptcy Code, including Section 365(f)thereof, Lessee is precluded from effecting any Transfer of a Facility except as may otherwise be expressly provided in this Lease.

24.1.10Public Offering/Public Trading. Notwithstanding anything to the contrary in this Article XXIV, other than in connection with a Transfer under Section 24.1.11 below, (i) Lessor’s consent shall not be required in connection with, and the other provisions of this Article XXIV shall not apply to any transfer of any stock of Lessee (or the stock of any Controlling Person) as a result of a public offering of Lessee’s (or such Controlling Person’s) stock (which transfers shall be deemed not to be “Transfers” hereunder) which (a) constitutes a bona fide public distribution of such stock pursuant to a firm commitment underwriting or a plan of distribution registered under the Securities Act of 1933 and (b) results in such stock being listed for trading on the American Stock Exchange or the New York Stock Exchange or authorized for quotation on the NASDAQ National Market immediately upon the completion of such public offering, (ii) for so long as the stock of Lessee or any Controlling Person(s)is listed for trading on the American Stock Exchange or the New York Stock Exchange or authorized for quotation on the NASDAQ National Market, the transfer or exchange of such stock over such exchange or market (which transfers or exchanges shall be deemed not to be “Transfers” hereunder).

24.1.11Certain Other Transfers. Notwithstanding anything to the contrary in this Article XXIV (including Section 24.1.10), but subject to the provisions of Section 24.1.8 above, so long as Brookdale has other material assets other than its interest (whether direct or indirect) in this Lease, the Facilities and any other leases of facilities between Lessor or an Affiliate of Lessor and Brookdale or an Affiliate of Brookdale, Lessor shall consent to any Transfer resulting from (a) a sale, transfer, distribution or other disposition of all or substantially all of the outstanding capital stock of Brookdale or a sale or transfer of all or substantially all of the assets of Brookdale, in each case directly or indirectly or through one or more step transactions or tiered transactions or (b) a merger, consolidation, stock exchange or other business combination to which Brookdale is a party, and the provisions of Section 24.1.2.2 shall not apply (i.e., there shall not be any Transfer Consideration payable) in connection with or related to such Transfer, so long as each of the following conditions is met:

24.1.11.1The Consolidated Net Worth of the purchaser or transferee resulting from a Transfer pursuant to clause (a)above or the surviving party resulting from a Transfer pursuant to clause (b)above, as the case may be, or the Controlling Person of such purchaser, transferee or surviving party, following the effectiveness of such event shall be equal to or greater than Two Billion Dollars ($2,000,000,000) and, in the case of a Controlling Person, such Controlling Person executes a Guaranty;

24.1.11.2The debt to equity ratio of the purchaser or transferee resulting from a Transfer pursuant to clause (a)above or the surviving party resulting from a Transfer pursuant to clause (b)above, as the case may be, or the Controlling Person of such purchaser, transferee or surviving party, following the effectiveness of such event shall be equal to or less than the average debt to equity ratio of Brookdale for the twelve (12) month period immediately prior to the effectiveness of such event. For purposes of this Section 24.1.11.2, “debt” shallinclude the capitalized value of any leases required to be capitalized in accordance with GAAP to which Brookdale and/or such transferee or surviving entity (and/or their consolidated Subsidiaries) are parties and the same shall be demonstrated by financial statements prepared in accordance with GAAP and reasonably satisfactory to Lessor;

24.1.11.3The purchaser or transferee resulting from a Transfer pursuant to clause (a)above or the other party(ies) to the Transfer pursuant to clause (b)above, as the case may be, shall have sufficient operating experience and history with respect to a business of the nature and type of the business of Brookdale as the same exists prior to the effectiveness of such event (which business is of a size that is meaningful in light of the size of the business of Brookdale as the same exists prior to the effectiveness of such event), as reasonably determined by Lessor. Such purchaser or transferee or other party to such Transfer, as the case may be, shall be deemed to have “sufficient operating experience and history” if (A) the core management team that will be managing the lessee under this Lease immediately following the effectiveness of such Transfer has an average of not less than three (3) years’ operating experience with respect to the operation and management of senior living or health care facilities, or (B) such transferee or purchaser or other party, as the case may be, shall immediately following the effectiveness of such Transfer, and for a period of not less than one (1) year thereafter, directly or indirectly retain and/or hire in a full-time management or consulting capacity a majority of the principal officers of Brookdale who were in the employment of Brookdale prior to the effectiveness of such Transfer;

24.1.11.4Lessee shall execute a written affirmation of its obligations under this Lease, in form and substance reasonably acceptable to Lessor. In addition, except in the case of a Transfer as to which such transferee or purchaser or surviving party, as the case may be, assumes the obligations of any Guarantor under the applicable Guaranty as a matter of law, such transferee or purchaser or surviving party shall execute either (A) a written assumption of each Guaranty in form and substance reasonably acceptable to Lessor or (B) a new guaranty of this Lease consistent in form and substance with each such Guaranty. In addition, if any such transferee, purchaser or surviving party is a subsidiary of and/or Controlled by another Person or Persons, the entity or entities constituting the ultimate parent(s)and/or other ultimate Controlling Person(s), as the case may be, shall execute a written guaranty of Lessee’s obligations under this Lease pursuant to a written guaranty in form and substance reasonably acceptable to Lessor;

24.1.11.5No Event of Default shall have occurred and be continuing hereunder;

24.1.11.6Intentionally Omitted; and

24.1.11.7Lessor shall receive the applicable information described in Section 24.1.2.1 with respect to each such proposed Transfer and the proposed purchaser, or transferee, or other party(ies) to the Transfer, as the case may be.

As used in this Section 24.1.11, “other material assets” shall mean that Brookdale has other net assets as determined in accordance with GAAP, whether direct or indirect, other than its interests (whether direct or indirect) in this Lease, the Facilities and any other facilities leased by Brookdale or an Affiliate of Brookdale from Lessor or an Affiliate of Lessor, which inthe aggregate total not less than One Hundred Million Dollars ($100,000,000) or represent at least forty percent (40%) of the total net assets as determined in accordance with GAAP of Brookdale, including its interests (whether direct or indirect) in the Facilities and any other facilities leased by Brookdale or any Affiliate of Brookdale from Lessor or an Affiliate of Lessor.

24.1.12Affiliate Transactions. Notwithstanding anything to the contrary contained in this Article XXIV but subject to the provisions of Section 24.1.8 above, Lessor’s consent shall not be required in connection with, and the provisions of Section 24.1.2.2 shall not apply (i.e., there shall not be any Transfer Consideration payable) in connection with or related to, (a) any assignment of Lessee’s interest in this Lease to one or more Affiliate(s)of Lessee (if more than one, jointly and severally as “Lessee” hereunder), (b) any transfer of any direct or indirect interest in Lessee to one or more Affiliate(s)of Lessee so long as (x) such transfer does not result in a change of control of, or other Transfer with respect to, Brookdale, in each case in violation of this Article XXIV, and (y) Brookdale continues to control Lessee or (c) a Master Sublease of all or any portion of the Leased Property to an Affiliate of Lessee (including any engagement by Lessee of an Affiliate to operate or manage all or any portion of the Leased Property) (each, a “Permitted Affiliate Transaction”), so long as in connection therewith, each of the following conditions is met:

24.1.12.1In connection with such Permitted Affiliate Transaction, there is no change in the use of the Leased Property of any Facility from its Primary Intended Use;

24.1.12.2No Event of Default shall have occurred and be continuing;

24.1.12.3In the case of such an assignment described in clause (a) of Section 24.1.12 above, (i) the assignee(s)shall assume (jointly and severally) all of the obligations of Lessee hereunder accruing subsequent to the effective date of such assignment by an instrument in writing in form and substance reasonably satisfactory to Lessor, and a copy thereof shall be delivered to Lessor along with the notice specified in Section 24.1.12.7 below, (ii) the original Lessee shall not be released from any of the obligations of the Lessee hereunder, whether occurring prior to or after the effective date of such transaction, and if requested by Lessor, shall execute a written guaranty of the “Lessee’s” obligations under this Lease in a form satisfactory to Lessor, and (iii) a copy of such executed assumption shall be delivered to Lessor along with the notice;

24.1.12.4In the case of any Master Sublease, (i) such Master Sublease shall be subject to the provisions of Section 24.1.5 above and such Master Sublease shall comply with all of the applicable provisions of this Article XXIV (except for the Lessor consent requirement), and a copy of such Master Sublease shall be delivered to Lessor along with the notice specified in 24.1.12.7 below, and (ii) Lessee shall not be released from any of the obligations of Lessee hereunder, whether occurring prior to or after the effective date of such transaction;

24.1.12.5In connection with any Permitted Affiliate Transaction, no Guarantor shall be released of any of its obligations under a Guaranty, and each Guarantor shall execute a written reaffirmation of its obligations under such Guaranty in form and substancereasonably satisfactory to Lessor and deliver the same to Lessor along with the notice specified in 24.1.12.7 below;

24.1.12.6Concurrently with the effective date of any such Permitted Affiliate Transaction (other than any transfer permitted under clause (b) of Section 24.1.12 above), Lessee shall cause the applicable Affiliate to grant to Lessor a security interest in form and substance reasonably satisfactory to Lessor with respect to such Affiliate’s personal property (whether tangible or intangible) consistent with (and subject to the same limitations and exclusions (if any) from such grant as) the security interest granted to Lessor pursuant to Section 16.8 hereof by Lessee, in each case, as additional security for Lessee’s obligations under this Lease and the obligations of any such Affiliate under this Lease and/or such Master Sublease, as applicable, and such agreement granting such security interest shall be delivered to Lessor along with the notice specified in 24.1.12.7 below; and

24.1.12.7Not less than ten (10)days prior to the effectiveness of any Permitted Affiliate Transaction, Lessee shall notify Lessor in writing of Lessee’s intention to enter into such Permitted Affiliate Transaction, the effective date thereof, the facts placing the same within the provisions of this Section 24.1.12 and any other change in the address for xxxxxxxx and notices to the Lessee pursuant to this Lease, accompanied by a copy of any documents and/or instruments required under the provisions of this Section 24.1.12, and Lessee shall deliver to Lessor executed copies of such documents and/or instruments on or prior to the effective date thereof.

ARTICLE XXV.

25.1Officer’s Certificates and Financial Statements.

25.1.1Officer’s Certificate. At any time and from time to time upon Lessee’s receipt of not less than fifteen (15) Business Days’ prior written request by Lessor, Lessee shall furnish to Lessor an Officer’s Certificate certifying (i) that this Lease is unmodified and in full force and effect, or that this Lease is in full force and effect as modified and setting forth the modifications; (ii) the dates to which the Rent has been paid; (iii) whether or not, to the best knowledge of Lessee, Lessor is in default in the performance of any covenant, agreement or condition contained in this Lease and, if so, specifying each such default of which Lessee may have knowledge; and (iv) responses to such other questions or statements of fact as Lessor, any ground or underlying lessor, any purchaser or any current or prospective Facility Mortgagee shall reasonably request. If Lessee fails to deliver such Officer’s Certificate within such fifteen (15) Business Day period, thereafter Lessee’s failure to deliver such Officer’s Certificate within five (5)Business Days Lessor delivers a second notice including the following legend in bold, fourteen (14) point type at the top of such request: “THIS IS A SECOND REQUEST FOR AN OFFICER’S CERTIFICATE OF LESSEE PURSUANT TO SECTION25.1.1 OF THE LEASE. FAILURE TO RESPOND TO THIS REQUEST WITHIN FIVE (5)BUSINESS DAYS WILL RESULT IN LESSEE BEING DEEMED TO HAVE DELIVERED THE ACKNOWLEDGMENT SET FORTH IN SUCH SECTION25.1.1”, shall constitute an acknowledgment by Lessee that (x) this Lease is unmodified and in full force and effect except as may be represented to the contrary by Lessor; (y) Lessor is not in default in the performance of any covenant, agreement or condition contained in this Lease; and (z) the other matters setforth in such request, if any, are true and correct. Any such certificate furnished pursuant to this Articlemay be relied upon by Lessor and any current or prospective Facility Mortgagee, ground or underlying lessor or purchaser of the Leased Property or any portion thereof.

25.1.2Statements. Lessee shall furnish the following statements to Lessor:

(a)within one hundred twenty (120) days after the end of each of Lessee’s and Guarantor’s fiscal years, a copy of the audited consolidated balance sheets of Lessee, Guarantor and their respective consolidated Subsidiaries as of the end of such fiscal year, and related audited consolidated statements of income, changes in common stock and other stockholders’ equity and changes in the financial position of Lessee, its consolidated Subsidiaries and Guarantor for such fiscal year, prepared in accordance with GAAP applied on a basis consistently maintained throughout the period involved, such consolidated financial statements to be certified by nationally recognized certified public accountants;

(b)within forty-five (45) days after the end of each fiscal quarter (other than the last fiscal quarter during any fiscal year of the applicable Person), (i) a copy of the unaudited consolidated balance sheets of Lessee, Guarantor and their respective consolidated Subsidiaries as of the end of such fiscal quarter, and related unaudited consolidated statements, changes in common stock and other stockholders’ equity and changes in the financial position of Lessee, Guarantor and their respective consolidated Subsidiaries for such fiscal quarter, and (ii) a statement of income of Lessee, Guarantor and their respective consolidated Subsidiaries that sets forth the results for both such fiscal quarter and year-to-date, in all cases prepared in accordance with GAAP applied on a basis consistently maintained throughout the applicable period;

(c)within one hundred twenty (120) days after the end of each of Lessee’s and Guarantor’s fiscal years, and together with the annual audit report furnished in accordance with clause (a)above, an Officer’s Certificate stating that to the best of the signer’s knowledge and belief after making due inquiry, Lessee is not in default in the performance or observance of any of the terms of this Lease, or if Lessee shall be in default, specifying all such defaults, the nature thereof, and the steps being taken to remedy the same;

(d)within twenty (20) days after the end of each calendar month, Facility level statements of income and detailed operational statistics regarding occupancy rates, patient and resident mix and patient and resident rates by type for each Facility for each such calendar month;

(e)upon request by Lessor (but not more frequently than once each fiscal year of Lessee), a copy of each cost report filed with the appropriate governmental agency for each Facility (provided, however, with respect to each request therefor, if Lessee’s reasonable costs and expenses incurred in assembling and delivering copies of such cost reports shall exceed One Thousand Five Hundred Dollars ($1,500) for the applicable request, Lessor shall reimburse Lessee for the amount of such reasonable costs and expenses actually incurred by Lessee in complying with such request);

(f)promptly upon Lessee’s receipt thereof, copies of all material written communications received by Lessee from any regulatory agency relating to any proceeding, formal or informal, with respect to cited deficiencies with respect to services and activities provided and performed at each Facility, including patient and resident care, patient and resident activities, patient and resident therapy, dietary, medical records, drugs and medicines, supplies, housekeeping and maintenance, or the condition of each Facility, and involving an actual or threatened warning, imposition of a material fine or a penalty, or suspension, termination or revocation of any Required Governmental Approval;

(g)promptly upon Lessee’s receipt thereof, copies of all claims, reports, complaints, notices, warnings or asserted violations relating in any way to the Leased Property or any Capital Additions or Lessee’s use thereof, the subject matter of which, if adversely determined, would be reasonably likely to have a material adverse effect on the continued operation, in accordance with the terms of this Lease, of the subject Facility(ies);

(h)with reasonable promptness, such other information respecting (i) the financial and operational condition and affairs of Lessee, any Guarantor and each Facility, (ii) the physical condition of the Leased Property and any Capital Additions and (iii) any suspected Transfer, including the then equity or voting ownership in

Lessee or in any Controlling Person(s), in each case as Lessor may reasonably request, in the form of a questionnaire or otherwise, from time to time; and

(i)reasonably promptly following Lessor’s request therefor, copies of all Required Governmental Approvals for each such Facility (provided, however, that Lessee shall have no obligation to separately deliver copies of any such Required Governmental Approvals to the extent that Lessor then has access to a web-based system maintained by Lessee that contains copies of such Required Governmental Approvals).

25.1.3Lessee’s Submission of Certificates/Statements. Lessee shall be obligated to furnish Lessor with all certificates and statements required under this Article XXV by (i) delivery of printed copies of the same to Lessor at its address set forth in Article XXXIII below or any other address that Lessor may from time to time designate in writing and (ii) electronic delivery of the same to Lessor in Microsoft® Office Excel format to the extent available in such format (or such other format as Lessor may from time to time reasonably require) at any electronic mail address that Lessor may from time to time designate in writing.

ARTICLE XXVI.

26.1Lessor’s Right to Inspect and Show the Leased Property and Capital Additions. Without limiting Lessor’s rights provided in Section 9.7, Lessee shall permit Lessor and its authorized representatives, upon not less than three (3) Business Days prior written notice (provided that no such notice shall be required after the occurrence, and during the continuance, of any Event of Default), to (i) inspect the Leased Property and any Capital Additions and (ii) exhibit the same to prospective purchasers and lenders, and during the last twelve (12) months of the Term applicable to each portion of the Leased Property and Capital Additions, to prospective lessees or managers, in each instance during usual business hours and subject to anyreasonable security, health, safety or confidentiality requirements of Lessee and to any Legal Requirement or Insurance Requirement. Lessee shall cooperate with Lessor in exhibiting the Leased Property and any Capital Additions to prospective purchasers, lenders, lessees and managers.

ARTICLE XXVII.

27.1No Waiver. No failure by Lessor to insist upon the strict performance of any term hereof or to exercise any right, power or remedy hereunder and no acceptance of full or partial payment of Rent during the continuance of any default or Event of Default shall constitute a waiver of any such breach or of any such term. No waiver of any breach shall affect or alter this Lease, which shall continue in full force and effect with respect to any other then existing or subsequent breach.

ARTICLE XXVIII.

28.1Remedies Cumulative. Each legal, equitable or contractual right, power and remedy of Lessor now or hereafter provided either in this Lease or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy and the exercise or beginning of the exercise by Lessor of any one or more of such rights, powers and remedies shall not preclude the simultaneous or subsequent exercise by Lessor of any or all of such other rights, powers and remedies.

ARTICLE XXIX.

29.1Acceptance of Surrender. No surrender to Lessor of this Lease or of the Leased Property or any Capital Additions or any part(s)thereof or of any interest therein, shall be valid or effective unless agreed to and accepted in writing by Lessor and no act by Lessor or any representative or agent of Lessor, other than such a written acceptance by Lessor, shall constitute an acceptance of any such surrender.

ARTICLE XXX.

30.1No Merger. There shall be no merger of this Lease or of the leasehold estate created hereby by reason of the fact that the same Person may acquire, own or hold, directly or indirectly, (i) this Lease or the leasehold estate created hereby or any interest in this Lease or such leasehold estate and (ii) the fee estate in the Leased Property or any parts thereof.

ARTICLE XXXI.

31.1Conveyance by Lessor. Lessor may, without the prior written consent or approval of Lessee, sell, transfer, assign, convey or otherwise dispose of any or all of the Leased Property. If Lessor or any successor owner of the Leased Property shall sell, transfer, assign, convey or otherwise dispose of the Leased Property other than as security for a debt, Lessor or such successor owner, as the case may be, shall thereupon be released from all future liabilities and obligations of Lessor with respect to such Leased Property under this Lease arising or accruing from and after the date of such sale, transfer, assignment or other disposition and allsuch future liabilities and obligations with respect to such Leased Property shall thereupon be binding upon such purchaser, grantee, assignee or transferee. In the event of any such sale, transfer, assignment, conveyance or other disposition (other than as security for a debt) of less than all of the Leased Property then subject to this Lease, the provisions of Section 31.2 hereof shall apply.

31.2New Lease. Lessor shall have the right, in connection with any Separation Event during the Term, by written notice to Lessee, to require Lessee to execute an amendment to this Lease whereby the Leased Property of one or more Facilities affected by such Separation Event (individually, a “Separated Property” or collectively, the

“Separated Properties”) is separated and removed from this Lease, and to simultaneously execute a substitute lease with respect to such Separated Property(ies), in which case:

31.2.1Lessor and Lessee shall execute a new lease (the “New Lease”) for such Separated Property(ies), effective as of the date specified in Section 31.2.3 below (the “New Lease Effective Date”), in the same form and substance as this Lease, but with such changes thereto as necessary to reflect the separation of the Separated Property(ies) from the balance of the Leased Property, including specifically the following:

(a)The total monthly Minimum Rent payable under such New Lease shall be the total applicable monthly Allocated Minimum Rent with respect to such Separated Property(ies);

(b)All Minimum Rent rental escalations under the New Lease shall be at the times and in the amounts set forth in this Lease for Minimum Rent increases; and

(c)The New Lease shall provide that the lessee thereunder shall be responsible for the payment, performance and satisfaction of all duties, obligations and liabilities arising under this Lease, insofar as they relate to the Separated Property(ies), that were not paid, performed and satisfied in full prior to the effective date of the New Lease (and Lessee under this Lease shall also be responsible for the payment, performance and satisfaction of the aforesaid duties, obligations and liabilities not paid, performed and satisfied in full prior to the effective date of such New Lease).

31.2.2Lessor and Lessee shall also execute an amendment to this Lease effective as of the New Lease Effective Date reflecting the separation of the Separated Property(ies) from the balance of the Leased Property and making such modifications to this Lease as are necessitated thereby at no material cost to Lessee and with no adverse effect on its rights, obligations and/or benefits hereunder (other than of a de minimis nature).

31.2.3In the case of any New Lease that is entered into in accordance with this Section 31.2 such New Lease shall be effective on the date which is the earlier of (i) the date the New Lease is fully executed and delivered by the parties thereto and (ii) the date specified in the written notice from Lessor to Lessee requiring a New Lease as described above, which date shall be no sooner than ten (10)days after the date such notice is issued.

31.2.4Lessee and Lessor shall take such actions and execute and deliver such documents, including without limitation the New Lease and an amendment to this Lease, as are reasonably necessary and appropriate to effectuate the provisions and intent of this Section 31.2.

31.2.5Each party shall bear its own costs and expenses in connection with any New Lease entered into in accordance with this Section 31.2.

31.3New Master Lease. Lessor shall have the right, exercisable in its discretion at any time during the Term by giving written notice thereof to Lessee, to require Lessee to execute and deliver (and cause the lessee(s)under any Other Lease to execute and deliver) an amendment to this Lease (and cause any guarantor of such Other Lease and each Guarantor hereof to execute and deliver consents and reaffirmations of the applicable guaranties), such that the Leased Property and the facilities covered by the Other Lease (collectively, the “Other Leased Property”) are leased by Lessor and the lessor(s)under such Other Lease to Lessee and the lessee(s)under such Other Lease, jointly and severally, pursuant to a single, indivisible, integrated and unitary lease agreement and economic unit (a “New Master Lease”). The lease of the Leased Property pursuant to such New Master Lease shall be upon the same terms and conditions set forth in this Lease with respect to the Leased Property. The lease of the Other Leased Property pursuant to such New Master Lease shall be upon the same economic terms and conditions (i.e., rent, rent escalations, term, renewal options, “transfer consideration”,etc.) as are set forth in such Other Lease, but otherwise upon substantially the same non-economic terms and conditions as are applicable to the Leased Property pursuant to this Lease. For purposes of implementing the foregoing with respect to the Other Leased Property, the parties acknowledge that the form of the amendment to this Lease adding the Other Leased Property to the “Leased Property” covered hereby shall be customary for similar transactions and is reasonably acceptable to Lessor and Lessee and with such changes thereto as are necessary to reflect the economic terms and conditions of such Other Lease, other facts relating to the Other Leased Property, and the leasing of the Leased Property and the Other Leased Property pursuant to a single, indivisible, integrated and unitary lease agreement and economic unit. Effective as of the date of execution and delivery of a New Master Lease, this Lease shall be deemed to be amended and restated in its entirety by such New Master Lease; provided, however, that neither Lessee nor any Guarantor shall be released from any of the obligations of the Lessee hereunder or any Guarantor under a Guaranty occurring prior to such date. Notwithstanding anything to the contrary contained in this Section 31.3, Lessor’s right to require Lessee to enter into a New Master Lease is expressly conditioned upon the approval thereof by any Facility Mortgagee hereunder and the facility mortgagee of all or any portion of the Other Leased Property.

31.4Purchase Option.

31.4.1Exercise of Option. Provided no Event of Default arising as a result of the failure to pay Minimum Rent has occurred and is continuing hereunder, Lessee shall have the option to purchase the Leased Property of one or more of the Facilities listed on Schedule 31.4 hereto at the applicable price designated for such Facility on Schedule 31.4, provided in no event shall Lessee have the right to acquire any Leased Property listed on Schedule 31.4 if the aggregate purchase price for all such Leased Properties acquired by Lesseehereunder exceeds $60,000,000. Lessee may exercise such option to purchase the Leased Property of one or more of the Facilities at any time during the Term from and after November 1, 2014, by (i) opening an escrow (the “Escrow”) by depositing a copy of this Lease with a national title company reasonably acceptable to Lessor (“Escrow Holder”), (ii) giving written notice

(the “Option Exercise Notice”) to Lessor of such deposit with Escrow Holder not later than thirty (30) days prior to the date specified in the Option Exercise Notice for the closing of the purchase, and (iii) if applicable, delivering to Lessor concurrently with the Option Exercise Notice a reaffirmation of each Guaranty executed by the applicable Guarantor stating, in substance, that such Guarantor’s obligations under such Guaranty shall extend to the purchase contract formed by Lessor and Lessee upon the exercise of such option. In the event that Lessee shall properly exercise such option, then the purchase shall be consummated on the date specified in the Option Exercise Notice, provided that Lessor and Lessee shall each have the right to postpone the same by up to ten (10)Business Days (such date, as the same may be so postponed, the “Outside Closing Date”). Provided no Event of Default arising as a result of the failure to pay Minimum Rent has occurred and is continuing hereunder, Lessee shall be entitled to exercise the foregoing option to purchase the Leased Property of one or more of the Facilities by delivering one or more Option Exercise Notices (and complying with the other requirements set forth above) at any time during the periods described herein.

31.4.2Defaults. If following a valid and proper exercise of the foregoing option to purchase any Leased Property, Lessee fails to complete the purchase of such Leased Property in accordance with Sections 31.4.1 and 31.4.3, then, at Lessor’s option and without limiting its other rights and remedies hereunder, at law or in equity, such option shall lapse with respect to all of the Facilities listed on Schedule 31.4 (and no longer be exercisable by Lessee with respect to any of them) and Lessor may terminate the purchase contract formed by Lessee’s exercise of such option and the Escrow by giving written notice thereof to Lessee and Escrow Holder, whereupon the Escrow shall be cancelled, all documents (if any) deposited with Escrow Holder shall be returned to the respective parties who deposited them, and Lessee shall pay all title and escrow cancellation charges and all of Lessor’s out-of-pocket costs in connection therewith.

31.4.3Escrow Provisions.

(a)Escrow shall be deemed open when a copy of this Lease is delivered to Escrow Holder.

(b)Lessee and Lessor each shall execute, deliver and be bound by such further escrow instructions or other instruments as may be reasonably requested by the other party or by Escrow Holder from time to time, so long as the same are consistent with the provisions of this Lease.

(c)Escrow shall close on or before the Outside Closing Date. As used herein, the term “Close of Escrow” shall mean the time and date that a deed described in Section 18.1 is recorded in appropriate records of the county in which the applicable Leased Property is located (or, if deeds are not customarily recorded on the day of closing in the county in which such Leased Property is located, then the date and time that such deed is delivered ordeemed delivered to Lessee). The Outside Closing Date shall not be extended for any reason other than as permitted by Section 45.1.6.

31.4.4Financing. With respect to the Leased Property of any Facility subject to an Option Exercise Notice delivered in accordance with Section 31.4.1, Lessor shall provide financing for any purchase of such Leased Property in the full amount of the purchase price therefor (any such financing, a “Purchase Money Loan”). Any Purchase Money Loan shall bear interest at the rate of eight and two-tenths percent (8.2%), shall be secured by a first-lien mortgage on the applicable Leased Property, shall be fully guaranteed by Brookdale, shall be prepayable without penalty at any time after January 1, 2015 (or, in the case of the Facility known as Osprey Court, at any time), and shall otherwise be on terms and conditions that are customary for similar transactions and are reasonably acceptable to Lessor and Lessee.

31.4.5Intentionally Omitted.

31.4.6Payment of Costs. Any and all costs incurred by any party in connection with the exercise of any option, the consummation or financing of any purchase, any reduction of Minimum Rent, or any other transaction described in this Section 31.4 (including costs of title insurance, attorneys’ fees, transfer taxes, mortgage recording taxes, recording fees, and escrow fees) shall be paid by Lessee.

ARTICLE XXXII.

32.1Quiet Enjoyment. So long as Lessee shall pay the Rent as the same becomes due and shall comply with the terms of this Lease and perform its obligations hereunder, Lessee shall peaceably and quietly have, hold and enjoy the Leased Property for the Term, free of any claim or other action by Lessor or anyone claiming by, through or under Lessor, but subject to all Permitted Encumbrances.

ARTICLE XXXIII.

33.1Notices. Any notice, consent, approval, demand or other communication required or permitted to be given hereunder (a “notice”) must be in writing

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THIS LEASE IS NOT TO BE RECORDED]