Common use of Reserves for Major Repairs Clause in Contracts

Reserves for Major Repairs. (a) Beginning on January 1, 2013, and on the first (1st) day of each calendar quarter thereafter during the Term, Lessee shall deliver to Lessor quarterly deposits in an amount equal to the product of (i) Two Thousand Five Hundred and No/100 Dollars ($2,500.00) (the “Dollar Amount”), multiplied by (ii) the number of beds placed in service or use at the Leased Property divided by (iii) four (4) (the “Reserve”). For the period commencing on the date hereof and ending December 31, 2013, the initial number of beds currently placed in service or placed in use at each of the Facilities shall be assumed to be forty (40); except (i) for the Laredo Facility which shall be assumed to be sixty (60), (ii) the Loveland Facility which shall be assumed to be sixty (60), (iii) the Mesquite Facility which shall be assumed to be sixty (60), (iv) the Greenwood Facility which shall be assumed to be forty-six (46), with the total beds placed in service or in use at all of the Facilities as of the Commencement Date is four hundred sixty-six (466). The Reserve shall be held by Lessor for the purpose of making Major Repairs to the applicable portions of the Leased Property. Beginning on January 1, 2014, the number of beds shall be determined by the actual number of beds placed in service or certified to be available for use in connection with the Facilities, which shall not be reduced without the prior written consent of Lessor. Lessor shall advance to or reimburse Lessee for Major Repairs, limited to the amount of the Reserve, upon Lessor’s receipt from Lessee of documentation of such costs that is sufficient in Lessor’s reasonable judgment. Beginning on the first Adjustment Date and on each Adjustment Date thereafter during the Term, the Dollar Amount to be multiplied by the number of beds as provided above shall be increased by the percentage by which the CPI published for the month which is two months prior to the applicable Adjustment Date shall have increased over the CPI figure published for the month which is two months prior to the previous Adjustment Date; provided, however, that in no event shall the increase in the Dollar Amount be less than Two Percent (2%) or more than Five Percent (5%) on any Adjustment Date. The amounts in the Reserve shall be used as described above to pay for Major Repairs, or, in the event Lessee fails to make any required non-Major Repairs hereunder, Lessor may use funds in the Reserve for that purpose. (b) Lessee hereby grants to Lessor a first priority security interest in all monies deposited into the Reserve. At Lessor’s request, Lessee shall, as soon as practicable, execute all documents necessary to effect such security interest in all monies deposited into the Reserve. So long as no Event of Default has occurred, and no event has occurred which, with the giving of notice or passage of time or both, would constitute such an Event of Default hereunder, any amounts remaining in the Reserve at the expiration of this Lease shall be returned to Lessee; provided, however, if such an Event of Default has occurred, or any event which, with the giving of notice or passage of time or both, would constitute such a default hereunder, Lessor may retain all amounts remaining in the Reserve and shall apply such amounts to any damages incurred by Lessor or used to pay outstanding obligations owed by Lessee to Lessor. Lessee consents to Lessor’s pledge of the Reserve to any Facility Lender.

Reserves for Major Repairs. (a) Beginning on January 1, 2013, the Initial Commencement Date and on the first (1st) day of each calendar quarter Reserve Payment Date thereafter during the Term, Lessee shall deliver to Lessor quarterly deposits with respect to each Facility in an amount equal to the product of (i) Two One Thousand Five Hundred and No/100 Dollars ($2,500.001,000.00) (the “Dollar Amount”), multiplied by (ii) the number of beds placed in service or use at each such Facility as of the Leased Property divided by most recent Adjustment Date (iii) four (4) (collectively, the “Reserve”); provided, that the first such deposit on the Initial Commencement Date shall be for the period from the Initial Commencement Date through October 1, 2015 and shall be prorated based on a three hundred sixty (360) day year. The aggregate amount of the Reserve shall not exceed an amount equal to twelve (12) times the amount that was required to be paid on the most recent Adjustment Date (the “Reserve Cap”) (and installments otherwise required under this Section 9.2(a) shall be reduced to the extent that the amount thereof plus the amount of the Reserve held by Lessor on the applicable Reserve Payment Date exceeds the Reserve Cap). For payments prior to the period commencing on the date hereof and ending December 31, 2013first Adjustment Date, the initial number of beds currently placed in service or placed in use at each of the Facilities such Facility shall be assumed to be forty (40); except (i) the following: for the Laredo Facility which shall be assumed to be sixty Oregon Facility, eighty-eight (6088), for the Oklahoma Facility, three hundred twenty (ii) the Loveland Facility which shall be assumed to be sixty (60320), and for the South Carolina Facility, one hundred sixteen (iii) the Mesquite Facility which shall be assumed to be sixty (60), (iv) the Greenwood Facility which shall be assumed to be forty-six (46116), with the total beds placed in service or in use at all of the Facilities as of the Initial Commencement Date is being five hundred twenty-four hundred sixty-six (466524). The Reserve shall be held by Lessor for On each Adjustment Date after the purpose of making Major Repairs to the applicable portions of the Leased Property. Beginning on January 1, 2014Initial Commencement Date, the number of beds shall be determined by the actual number of beds placed in service or certified to be available for use in connection with the Facilitiessuch Facilities as of such Adjustment Date, which shall not be reduced without the prior written consent of Lessor. (b) The Reserve shall be held by Lessor in an interest bearing account for the purpose of making Major Repairs to the applicable portions of the Leased Property. Lessor shall advance to or reimburse Lessee for Major Repairs, limited to the amount of the Reserve, upon Lessor’s receipt from Lessee of documentation of such costs that is sufficient in Lessor’s reasonable judgment. Beginning on the first Adjustment Date January 1, 2017 and on each Adjustment Date thereafter during the Term, the applicable Dollar Amount to be multiplied by the number of beds as provided above shall be increased by the greater of (i) Two Percent (2.0%) of the prior year’s applicable Dollar Amount, and (ii) the percentage by which the CPI published for the month which is two months of October prior to the applicable Adjustment Date shall have increased over the CPI figure published for the month which is two months of October prior to the previous Adjustment DateDate (the CPI figure published for the month of October 2015 shall be used in connection with the recalculation on January 1, 2017); provided, however, that in no event shall the such increase in the Dollar Amount be less more than Two Four Percent (2%) or more than Five Percent (54.0%) on any Adjustment Date. The amounts in the Reserve shall be used as described above to pay for Major Repairs, or, in the event Lessee fails to make any required non-Major Repairs hereunder, Lessor may use funds in the Reserve for that purpose. (bc) Lessee hereby grants to Lessor a first priority security interest in all monies deposited into the Reserve. At Lessor’s request, Lessee shall, as soon as practicable, execute all documents necessary to effect such security interest in all monies deposited into the Reserve. So long as no Event of Default has occurred, occurred and no event has then occurred which, with the giving of notice or passage of time or both, would constitute such an Event of Default hereunder, any amounts remaining in the Reserve at the expiration of this Lease shall be returned to Lessee; provided, however, if such an Event of Default has occurred, or any event which, has then occurred which with the giving of notice or passage of time or both, both would constitute such a default an Event of Default hereunder, Lessor may retain all amounts remaining in the Reserve and shall apply such amounts to any damages incurred by Lessor or used to pay outstanding obligations owed by Lessee to Lessor. Lessee consents to Lessor’s pledge of the Reserve to any Facility LenderObligations.

Reserves for Major Repairs. (a) Beginning on January 1, 2013, and on the first (1st) day of each calendar quarter thereafter during the Loan Term, Lessee the Borrower Parties shall deliver to Lessor MPT quarterly deposits in an amount equal to the product of (i) Two Thousand Five Hundred and No/100 Dollars ($2,500.00) (the “Dollar Amount”), multiplied by (ii) the number of beds placed in service or use at the Leased Property Real Property, divided by (iii) four (4) (the “Reserve”). For the period commencing on the date hereof and ending on December 31, 2013, the initial number of beds currently placed in service or placed in use at each of the Facilities shall be assumed to be forty (40); except (i) for the Laredo Las Cruces Facility which shall be assumed to be sixty (60), (ii) the Loveland Facility which shall be assumed to be sixty (60), (iii) the Mesquite Facility which shall be assumed to be sixty (60), (iv) the Greenwood Facility which shall be assumed to be forty-six (46), with the total beds placed in service or in use at all of the Facilities as of the Commencement Date the date hereof is four one hundred sixty-six forty (466140). The Reserve shall be held by Lessor MPT for the purpose of making Major Repairs to the applicable portions of the Leased Real Property. Beginning on January 1, 2014, the number of beds shall be determined by the actual number of beds placed in service or certified to be available for use in connection with the Facilities, which shall not be reduced without the prior written consent of LessorMPT. Lessor MPT shall advance to or reimburse Lessee the Borrower Parties for Major Repairs, limited to the amount of the Reserve, upon LessorMPT’s receipt from Lessee the Borrower Parties of documentation of such costs that is sufficient in LessorMPT’s reasonable judgment. Beginning on the first Adjustment Date and on each Adjustment Date thereafter during the Loan Term, the Dollar Amount to be multiplied by the number of beds as provided above shall be increased by the percentage by which the CPI published for the month which is two months prior to the applicable Adjustment Date shall have increased over the CPI figure published for the month which is two months prior to the previous Adjustment Date; provided, however, that in no event shall the increase in the Dollar Amount be less than Two Percent (2%) or more than Five Percent (5%) on any Adjustment Date. The amounts in the Reserve shall be used as described above to pay for Major Repairs, or, in the event Lessee the Borrower Parties fails to make any required non-Major Repairs hereunder, Lessor MPT may use funds in the Reserve for that purpose. (b) Lessee The Borrower Parties hereby grants to Lessor MPT a first priority security interest in all monies deposited into the Reserve. At LessorMPT’s request, Lessee the Borrower Parties shall, as soon as practicable, execute all documents necessary to effect such security interest in all monies deposited into the Reserve. So long as no Major Event of Default has occurred, and no event has occurred which, with the giving of notice or passage of time or both, would constitute such an a Major Event of Default hereunder, any amounts remaining in the Reserve at the expiration of this Lease Agreement shall be returned to Lesseethe Borrower Parties; provided, however, if such an a Major Event of Default has occurred, or any event which, with the giving of notice or passage of time or both, would constitute such a default Major Event of Default hereunder, Lessor MPT may retain all amounts remaining in the Reserve and shall apply such amounts to any damages incurred by Lessor MPT or used to pay outstanding obligations owed by Lessee the Borrower Parties to LessorMPT. Lessee The Borrower Parties consents to LessorMPT’s pledge of the Reserve to any Facility Lender. (c) MPT shall hold the Reserve in a separate, interest-bearing account. The Borrower Parties shall receive all interest accrued on the Reserve in accordance with subsection (b) above.

Reserves for Major Repairs. (a) Beginning on January 1, 2013, the Commencement Date and on the first (1st) day of each calendar quarter Reserve Payment Date thereafter during the Term, Lessee shall deliver to Lessor quarterly deposits with respect to each of the Xxxxxxxx Facility, the Garden Grove Hospital Facility, the Paradise Valley Facility and the San Dimas Hospital Facility, in an amount equal to the product of (i) Two Thousand Five Hundred and No/100 Dollars ($2,500.002,000.00) (the “Hospital Dollar Amount”), ) multiplied by (ii) the number of beds placed in service or use at such Facilities as of the Leased Property divided most recent Adjustment Date (or, in the case of payments prior to January 1, 2013, the amounts set forth in the immediately succeeding sentence) multiplied by (iii) four 0.25 (4collectively, the “Hospital Reserve”); provided, that, (A) the first such deposit on the Commencement Date shall be for the period from the Commencement Date through September 30, 2012 and shall be prorated based on a three hundred sixty (360)-day year; (B) the aggregate amount of the Hospital Reserve shall not exceed an amount equal to twelve (12) times the amount that was required to be paid on the most recent Adjustment Date (the “ReserveHospital Reserve Cap”) (and payments otherwise required under this Section 9.2(a) shall be reduced to the extent that the amount thereof plus the amount of the Hospital Reserve at the time of payment is in excess of the Hospital Reserve Cap); and (C) the aggregate amount of the Hospital Reserve shall not be less than the product of (1) One Thousand Five Hundred and No/100 Dollars ($1,500.00) multiplied by (2) the number of beds placed in service or use at such Facilities as of the most recent Adjustment Date (the “Hospital Reserve Floor”), and any time the Hospital Reserve amount shall be less than the Hospital Reserve Floor, Lessee shall deposit the amount necessary to replenish the Hospital Reserve to an amount equal to the Hospital Reserve Floor within five (5) days after written demand from Lessor. For the period commencing on the date hereof and ending December 31payments prior to January 1, 2013, the initial number of beds currently placed in service or placed in use at each of the Facilities shall be assumed to be forty (40); except (i) for the Laredo Facility which shall be assumed to be sixty (60), (ii) the Loveland Facility which shall be assumed to be sixty (60), (iii) the Mesquite Facility which shall be assumed to be sixty (60), (iv) the Greenwood Facility which shall be assumed to be forty-six (46), with the total beds placed in service or in use at all of each such Facility shall be assumed to be the Facilities as of following: (w) for the Commencement Date is four Xxxxxxxx Facility, three hundred six (306), (x) for the Garden Grove Hospital Facility, one hundred sixty-six seven (466167). The Reserve shall be held by Lessor , (y) for the purpose Paradise Valley Facility, three hundred one (301), and (z) for the San Dimas Hospital Facility, ninety-three (93), an aggregate of making Major Repairs to eight hundred sixty-seven (867) beds. On each Adjustment Date after the applicable portions of the Leased Property. Beginning on January 1, 2014Commencement Date, the number of beds shall be determined by the actual number of beds placed in service or certified to be available for use in connection with the Facilitiessuch Facilities as of such Adjustment Date, which shall not be reduced without the prior written consent of Lessor. On the Commencement Date, Lessor shall refund to Lessee the excess, if any of the reserves under the provisions of the Original Prime Leases that are being replaced by this Lease that correspond to this Section 9.2(a) in excess of the Hospital Reserve Floor. (b) In addition to the Hospital Reserve, beginning on the Commencement Date and on each Reserve Payment Date thereafter during the Term, Lessee shall deliver to Lessor quarterly deposits (i) with respect to the Garden Grove MOB Facility, in an amount equal to (A) Thirty-Four Thousand and No/100 Dollars ($34,000.00) multiplied by (B) 0.25 (the “Garden Grove MOB Amount”), and (ii) with respect to the San Dimas MOB Facility, in an amount equal to (A) Sixty-Eight Thousand and No/100 Dollars ($68,000.00) multiplied by (B) 0.25 (the “San Dimas MOB Amount”) (collectively, the “MOB Reserve”) (the Hospital Reserve and the MOB Reserve are hereinafter referred to collectively as the “Reserve”); provided, that, (A) the first such deposit on the Commencement Date shall be for the period from the Commencement Date through September 30, 2012 and shall be prorated based on a three hundred sixty (360)-day year, (B) the aggregate amount of the MOB Reserve shall not exceed an amount equal to twelve (12) times the amount that was required to be paid on the most recent Adjustment Date (the “MOB Reserve Cap”) (and payments otherwise required under this Section 9.2(b) shall be reduced to the extent that the amount thereof plus the amount of the MOB Reserve at the time of payment is in excess of the MOB Reserve Cap) and (C) the aggregate amount of the MOB Reserve shall not be less than Seventy-Five Percent (75%) of the annualized amount of the then-applicable MOB Reserve payment amount (the “MOB Reserve Floor”), and any time the MOB Reserve amount shall be less than MOB Reserve Floor the Lessee shall deposit the amount necessary to replenish the MOB Reserve to an amount equal to the MOB Reserve Floor within five (5) days after written demand from MPT. On the Commencement Date, Lessor shall refund to Lessee the excess, if any, of the reserves under the provisions of the Original Prime Leases that are being replaced by this Lease that correspond to this Section 9.2(b) in excess of the MOB Reserve Floor. (c) The Reserve shall be held by Lessor in an interest bearing account for the purpose of making Major Repairs to the applicable portions of the Leased Property. Lessor shall advance to or reimburse Lessee for Major Repairs, limited to the amount of the Reserve, upon Lessor’s receipt from Lessee of documentation of such costs that is sufficient in Lessor’s reasonable judgment. Beginning on the first Adjustment Date and on each Adjustment Date thereafter during the Term, the applicable Dollar Amount to be multiplied by the number of beds as provided above shall be increased by the greater of (i) Two and Percent (2.0%) of the prior year’s applicable Dollar Amount, and (ii) the percentage by which the CPI published for the month which is two months prior to the applicable Adjustment Date shall have increased over the CPI figure published for the month which is two months prior to the previous Adjustment Date; providedDate (the Commencement Date shall be used for the previous Adjustment Date in connection with the recalculation on January 1, however, that in no event shall the increase in the Dollar Amount be less than Two Percent (2%) or more than Five Percent (5%) on any Adjustment Date2013). The amounts in the Reserve shall be used as described above to pay for Major Repairs, or, in the event Lessee fails to make any required non-Major Repairs hereunder, Lessor may use funds in the Reserve for that purpose. (bd) Lessee hereby grants to Lessor a first priority security interest in all monies deposited into the Reserve. At Lessor’s request, Lessee shall, as soon as practicable, execute all documents necessary to effect such security interest in all monies deposited into the Reserve. Lessee consents to Lessor’s pledge of the Reserve to any Facility Lender. So long as no Event of Default has occurred, occurred and no event has occurred which, with the giving of notice or passage of time or both, would constitute such an Event of Default hereunderis continuing, any amounts remaining in the Reserve Reserve, after the payment of and the reimbursement for the Major Repairs on the Facility, at the expiration of this Lease shall be returned to Lessee; provided, however, if such an Event of Default has occurred, or any event which, with occurred and is continuing at the giving expiration of notice or passage of time or both, would constitute such a default hereunderthis Lease, Lessor may retain all amounts remaining in the Reserve and shall apply such amounts to any damages incurred by Lessor or used to pay outstanding obligations owed by Lessee to Lessor. Lessee consents to Lessor’s pledge at the expiration of the Reserve to any Facility LenderLease as collateral for the “Obligations” (as defined in the Security Agreement).

Reserves for Major Repairs. (a) Beginning on January 1, 2013, the Commencement Date and on the first (1st) day of each calendar quarter Reserve Payment Date thereafter during the Term, Lessee shall deliver to Lessor quarterly deposits with respect to each Facility in an amount equal to the product of (i) Two Thousand Five Hundred and No/100 Dollars ($2,500.002,000.00) (the “Dollar Amount”), ) multiplied by (ii) the number of beds placed in service or use at such Facilities as of the Leased Property divided most recent Adjustment Date (or, in the case of payments prior to January 1, 2013, the amounts set forth in the immediately succeeding sentence) multiplied by (iii) four 0.25 (4) (collectively, the “Reserve”); provided, that, (A) the first such deposit on the Commencement Date shall be for the period from the Commencement Date through September 30, 2012 and shall be prorated based on a three hundred sixty (360)-day year; (B) the aggregate amount of the Reserve shall not exceed an amount equal to twelve (12) times the amount that was required to be paid on the most recent Adjustment Date (the “Reserve Cap”) (and payments otherwise required under this Section 9.2(a) shall be reduced to the extent that the amount thereof plus the amount of the Reserve at the time of payment is in excess of the Reserve Cap); and (C) the aggregate amount of the Reserve shall not be less than the product of (1) One Thousand Five Hundred and No/100 Dollars ($1,500.00) multiplied by (2) the number of beds placed in service or use at such Facilities as of the most recent Adjustment Date (the “Reserve Floor”), and any time the Reserve amount shall be less than the Reserve Floor, Lessee shall deposit the amount necessary to replenish the Reserve to an amount equal to the Reserve Floor within five (5) days after written demand from Lessor. For the period commencing on the date hereof and ending December 31payments prior to January 1, 2013, the initial number of beds currently placed in service or placed in use at each of the Facilities such Facility shall be assumed to be forty (40); except the following: (i) for the Laredo Facility which shall be assumed to be sixty Huntington Beach Facility, one hundred thirty-one (60131), (ii) for the Loveland Facility which shall be assumed to be sixty La Palma Facility, one hundred forty-one (60141), (iii) for the Mesquite Facility which shall be assumed to be sixty (60)Shasta Facility, (iv) the Greenwood Facility which shall be assumed to be two hundred forty-six (46246), and (iv) for the West Anaheim Facility, two hundred nineteen (219), with the total beds placed in service or in use at all of the Facilities as of the Commencement Date is four seven hundred sixtythirty-six seven (466737). The Reserve shall be held by Lessor for On each Adjustment Date after the purpose of making Major Repairs to the applicable portions of the Leased Property. Beginning on January 1, 2014Commencement Date, the number of beds shall be determined by the actual number of beds placed in service or certified to be available for use in connection with the Facilitiessuch Facilities as of such Adjustment Date, which shall not be reduced without the prior written consent of Lessor. On the Commencement Date, Lessor shall refund to Lessee the excess, if any of the reserves under the provisions of the Original Prime Leases that are being replaced by this Lease that correspond to this Section 9.2(a) in excess of the Reserve Floor. (b) The Reserve shall be held by Lessor in an interest bearing account for the purpose of making Major Repairs to the applicable portions of the Leased Property. Lessor shall advance to or reimburse Lessee for Major Repairs, limited to the amount of the Reserve, upon Lessor’s receipt from Lessee of documentation of such costs that is sufficient in Lessor’s reasonable judgment. Beginning on the first Adjustment Date and on each Adjustment Date thereafter during the Term, the applicable Dollar Amount to be multiplied by the number of beds as provided above shall be increased by the greater of (i) Two and Percent (2.0%) of the prior year’s applicable Dollar Amount, and (ii) the percentage by which the CPI published for the month which is two months prior to the applicable Adjustment Date shall have increased over the CPI figure published for the month which is two months prior to the previous Adjustment Date; providedDate (the Commencement Date shall be used for the previous Adjustment Date in connection with the recalculation on January 1, however, that in no event shall the increase in the Dollar Amount be less than Two Percent (2%) or more than Five Percent (5%) on any Adjustment Date2013). The amounts in the Reserve shall be used as described above to pay for Major Repairs, or, in the event Lessee fails to make any required non-Major Repairs hereunder, Lessor may use funds in the Reserve for that purpose. (bc) Lessee hereby grants to Lessor a first priority security interest in all monies deposited into the Reserve. At Lessor’s request, Lessee shall, as soon as practicable, execute all documents necessary to effect such security interest in all monies deposited into the Reserve. Lessee consents to Lessor’s pledge of the Reserve to any Facility Lender. So long as no Event of Default has occurred, occurred and no event has occurred which, with the giving of notice or passage of time or both, would constitute such an Event of Default hereunderis continuing, any amounts remaining in the Reserve Reserve, after the payment of and the reimbursement for the Major Repairs on the Facility, at the expiration of this Lease shall be returned to Lessee; provided, however, if such an Event of Default has occurred, or any event which, with occurred and is continuing at the giving expiration of notice or passage of time or both, would constitute such a default hereunderthis Lease, Lessor may retain all amounts remaining in the Reserve and shall apply such amounts to any damages incurred by Lessor or used to pay outstanding obligations owed by Lessee to Lessor. Lessee consents to Lessor’s pledge at the expiration of the Reserve to any Facility LenderLease as collateral for the “Obligations” (as defined in the Security Agreement).