Common use of Upgrade Expenditures Clause in Contracts

Upgrade Expenditures. Tenant shall include with each Minimum Rent payment, starting with the first (1st) full month of the Term, a deposit to be added to a reserve (in the aggregate, the “CapEx Reserve”) equal to, with respect to each Facility, one-twelfth 1/12th of the amount shown on Schedule 4 based on the age of such Facility (as adjusted at the end of each Lease Year for increases since the Effective Date in the CPI, the “CapEx Amount”), multiplied by (ii) the aggregate number of units in such Facility on the date such payment is due. Landlord shall not be deemed to hold the same in trust or as an agent for Tenant. Tenant acknowledges that the impounding of such funds in the CapEx Reserve shall constitute a true escrow, and that Tenant has no, and hereby waives any, interest in or right or title to any funds escrowed pursuant to this Section 8.3, whether legal, equitable, beneficial or otherwise. From time to time, but not more often than once in any calendar month and provided that no Event of Default is then continuing, Landlord will pay to Tenant amounts from the CapEx Reserve to reimburse Tenant for Upgrade Expenditures made by Tenant during the prior rolling twenty-four (24) month period during the Term (or portion thereof), as reasonably determined by Landlord based on evidence of such expenditures submitted by Tenant; provided that such amount shall not exceed with respect to any individual Facility in any rolling twenty-four (24) month period during the Term, two (2) times the CapEx Amount multiplied by the average number of beds in such Facility over such period. Landlord shall make the reimbursements to Tenant required hereunder within twenty-one (21) days after satisfaction, in all material respects, of all conditions to such reimbursement. Upon reasonable advance request, Landlord may require Tenant to procure mechanic’s lien waivers, in form and substance reasonably satisfactory to Landlord, in

Upgrade Expenditures. (a) Tenant shall include deliver to Landlord, with each payment of Minimum Rent payment, starting with the first (1st) full month of the TermRent, a deposit to be added to a reserve (in the aggregate, the “CapEx Upgrade Reserve”) equal to, with respect to each Facility, the sum of (a) of one-twelfth 1/12th (1/12th) of the amount shown on Schedule 4 based on the age of such Facility Applicable Annual Reserve (as hereinafter defined and as adjusted at annually after the end of each tenth (10th) Lease Year for increases in the CPI since the Effective Date in commencement of the CPI, the “CapEx Amount”tenth (10th) Lease Year), multiplied by (iib) the aggregate number of assisted living units in such the Facility on (the date such payment is due“Upgrade Minimum”) minus (c) the Upgrade Overage (as hereinafter defined). Landlord shall not be deemed to hold As used herein, the same in trust or as an agent for Tenant. Tenant acknowledges that the impounding of such funds in the CapEx Reserve shall constitute a true escrow, and that Tenant has no, and hereby waives any, interest in or right or title to any funds escrowed pursuant to this Section 8.3, whether legal, equitable, beneficial or otherwise. “Applicable Annual Reserve” means: One through Four $ 360.00 Five through Seven $ 460.00 Eight through Ten $ 500.00 Each Lease Year thereafter $ 500.001 From time to time, but not more often than once twice in any calendar month and provided that no Event of Default is then continuing, Landlord will pay disburse to Tenant amounts from the CapEx Upgrade Reserve for the payment of costs incurred by Tenant with respect to reimburse the Premises, subject to the following conditions: (i) the costs incurred by Tenant shall be for the purposes of making capital improvements to the Facility, acquiring furniture and fixtures needed for the operation of the Facility or making Upgrade Expenditures (the “Permitted Expenditures”); provided, however, in no event shall the Permitted Expenditures be deemed or construed to include the costs of the Mandatory Repairs to be made by Tenant during pursuant to Section 8.2 above; and (ii) Tenant’s request for disbursement shall be accompanied with such invoices or purchase orders evidencing the prior rolling twenty-four (24) month period during the Term (or portion thereof), expenditure as Landlord may reasonably determined by Landlord based on evidence of such expenditures submitted by Tenant; provided that such amount shall not exceed with respect to any individual Facility in any rolling twenty-four (24) month period during the Term, two (2) times the CapEx Amount multiplied by the average number of beds in such Facility over such periodrequire. Landlord shall make the reimbursements to Tenant required hereunder within twenty-one fourteen (2114) days after satisfaction, in all material respects, satisfaction of all conditions to such reimbursementdisbursement. Upon reasonable advance request, Landlord may require Tenant to procure mechanic’s lien waivers, in form and substance reasonably satisfactory to Landlord, inprocure

Upgrade Expenditures. Tenant shall include with each Minimum Rent payment, starting with the first (1st) full month of the Term, a deposit to be added to a reserve (in the aggregate, the “"CapEx Reserve”") equal to, with respect to each Facility, one-twelfth 1/12th (1/12th) of the amount shown on Schedule 4 based on the age of such Facility equal to (i) Two Hundred Fifty Dollars ($250) (as adjusted at the end of each Lease Year for increases since the Effective Date in the CPI, the “"CapEx Amount”"), multiplied by (ii) the aggregate number of units beds in such Facility all of the Facilities on the date such payment is due. This reserve shall bear interest, which shall be added to and become a part thereof. Landlord shall not be deemed to hold the same in trust or as an agent for Tenant. Tenant acknowledges that the impounding of such funds in the CapEx Reserve shall constitute a true escrow, and that Tenant has no, and hereby waives any, interest in or right or title to any funds escrowed pursuant to this Section 8.3, whether legal, equitable, beneficial or otherwise. From time to time, but not more often than once in any calendar month and provided that no Event of Default is then continuing, Landlord will pay to Tenant amounts from the CapEx Reserve to reimburse Tenant for Upgrade Expenditures made by Tenant during the prior rolling twentythirty-four six (2436) month period during the Term (or portion thereof), as reasonably determined by Landlord based on evidence of such expenditures submitted by TenantTenant (which shall be in substantially the same form utilized by Nationwide Health Properties and Tenant (or their respective affiliates) for such purposes); provided that such amount shall not exceed with respect to any individual Facility in any rolling twentythirty-four six (2436) month period during the Term, two three (23) times the CapEx Amount multiplied by the average number of beds in such Facility over such period. Landlord shall make the reimbursements to Tenant required hereunder within twenty-one (21) days after satisfaction, in all material respects, satisfaction of all conditions to such reimbursement. Upon reasonable advance request, Landlord may require Tenant to procure mechanic’s 's lien waivers, in form and substance reasonably satisfactory to Landlord, inin connection with any Upgrade Expenditures in excess of One Thousand Dollars ($1,000). "Upgrade Expenditures" means expenditures in commercially reasonable amounts to Persons not affiliated with Tenant for (i) upgrades or improvements to each Facility that have the effect of maintaining or improving its competitive position in its respective marketplace, including new or replacement wallpaper, tiles, window coverings, lighting fixtures, painting, upgraded landscaping, carpeting, architectural adornments, common area amenities and the like, but excluding capital improvements or repairs (including repairs or replacements of the roof, structural elements of the walls, parking area or the electrical, plumbing, HVAC or other mechanical or structural systems), and (ii) other improvements to each Facility as reasonably approved by Landlord, which shall include those matters, if any, that Landlord has approved in writing as of the Effective Date based on descriptions and budgets that Tenant has provided prior thereto. Any amount remaining in the CapEx Reserve at the expiration of the Term or earlier termination of this Master Lease shall be retained by Landlord as additional or supplemental Rent hereunder.

Upgrade Expenditures. Tenant shall include with each Minimum Rent payment, starting with the first (1st) full month of the Term, a deposit to be added to a reserve (in the aggregate, the “CapEx Reserve”"CAPEX RESERVE") equal to, with respect to each Facility, one-twelfth 1/12th (1/12th) of the amount shown on Schedule 4 based on the age of such Facility equal to (i) TWO HUNDRED FIFTY DOLLARS ($250) (as adjusted at the end of each Lease Year for increases since the Effective Date in the CPI, the “CapEx Amount”"CAPEX AMOUNT"), multiplied by (ii) the aggregate number of units beds in such Facility all of the Facilities on the date such payment is due. This reserve shall bear interest, which shall be added to and become a part thereof. Landlord shall not be deemed to hold the same in trust or as an agent for Tenant. Tenant acknowledges that the impounding of such funds in the CapEx Reserve shall constitute a true escrow, and that Tenant has no, and hereby waives any, interest in or right or title to any funds escrowed pursuant to this Section 8.3, whether legal, equitable, beneficial or otherwise. From time to time, but not more often than once in any calendar month and provided that no Event of Default is then continuing, Landlord will pay to Tenant amounts from the CapEx Reserve to reimburse Tenant for Upgrade Expenditures made by Tenant during the prior rolling twentythirty-four six (2436) month period during the Term (or portion thereof), as reasonably determined by Landlord based on evidence of such expenditures submitted by TenantTenant (which shall be in substantially the same form utilized by Nationwide Health Properties and Tenant (or their respective affiliates) for such purposes); provided that such amount shall not exceed with respect to any individual Facility in any rolling twentythirty-four six (2436) month period during the Term, two three (23) times the CapEx Amount multiplied by the average number of beds in such Facility over such period. Landlord shall make the reimbursements to Tenant required hereunder within twenty-one (21) days after satisfaction, in all material respects, satisfaction of all conditions to such reimbursement. Upon reasonable advance request, Landlord may require Tenant to procure mechanic’s 's lien waivers, in form and substance reasonably satisfactory to Landlord, inin connection with any Upgrade Expenditures in excess of ONE THOUSAND DOLLARS ($1,000). "UPGRADE EXPENDITURES" means expenditures in commercially reasonable amounts to Persons not affiliated with Tenant for (I) upgrades or improvements to each Facility that have the effect of maintaining or improving its competitive position in its respective marketplace, including new or replacement wallpaper, tiles, window coverings, lighting fixtures, painting, upgraded landscaping, carpeting, architectural adornments, common area amenities and the like, but excluding capital improvements or repairs (including repairs or replacements of the roof, structural elements of the walls, parking area or the electrical, plumbing, HVAC or other mechanical or structural systems), and (II) other improvements to each Facility as reasonably approved by Landlord, which shall include those matters, if any, that Landlord has approved in writing as of the Effective Date based on descriptions and budgets that Tenant has provided prior thereto. Any amount remaining in the CapEx Reserve at the expiration of the Term or earlier termination of this Master Lease shall be retained by Landlord as additional or supplemental Rent hereunder.