INVESTOR RIGHTS AGREEMENT among CAPITAL SENIOR LIVING CORPORATION, SILK PARTNERS, LP, CONVERSANT DALLAS PARKWAY (A) LP and CONVERSANT DALLAS PARKWAY (B) LP dated as of November 3, 2021

Exhibit 10.1

Execution Version

INVESTOR RIGHTS AGREEMENT

among

CAPITAL SENIOR LIVING CORPORATION,

SILK PARTNERS, LP,

CONVERSANT DALLAS PARKWAY (A) LP

and

CONVERSANT DALLAS PARKWAY (B) LP

dated as of November 3, 2021

TABLE OF CONTENTS


		Page

1.	Board Matters	1

2.	Transfer Restrictions	5

3.	Standstill	6

4.	Consent Rights	7

5.	Preemptive Rights	8

6.	Confidentiality	10

7.	Interpretation; Other Definitions	11

8.	Miscellaneous	14

INDEX OF DEFINED TERMS


A&R Investment Agreement		recitals
Affiliate		Section 7(f)
Agreement		preamble
as-converted basis		Section 7(d)
Backstop Agreement		recitals
Beneficial Owner		Section 7(e)
Beneficial Ownership		Section 7(e)
Beneficially Own		Section 7(e)
Board of Directors		Section 7(g)
Business Day		Section 7(h)
Bylaws		Section 7(i)
Certificate of Designations		Section 7(j)
Certificate of Incorporation		Section 7(k)
Closing		Section 7(l)
Closing Date		Section 7(m)
Common Stock		Section 7(n)
Company		preamble
Conversant Investors		preamble
Conversant Parties		Section 1(a)
Derivative Instruments		Section 7(o)
Encumbrance		Section 7(p)
Equity Securities		Section 7(q)


Exchange Act		Section 7(r)
Indebtedness		Section 7(s)
Information		Section 6
Investor Board Representatives		Section 1(a)
Investor Holder		Section 5(b)
NYSE		Section 1(a)
Permitted Transfer		Section 2(b)
Permitted Transferee		Section 2(c)
Person		Section 7(t)
Preemptive Rights Issuance		Section 5(a)
Preemptive Rights Notice		Section 5(b)
Private Placement Common Stock		recitals
Prohibited Shares		Section 2(a)
Representatives		Section 6
Restricted Period Termination Date		Section 2(a)
Series A Preferred Stock		recitals
Silk Investor		recitals
Silk Parties		Section 1(a)
Subsidiary		Section 7(u)
Transfer		Section 7(v)
Unaffiliated Shareholders		Section 7(w)

INVESTOR RIGHTS AGREEMENT

This INVESTOR RIGHTS AGREEMENT (this “Agreement”) is dated as of November 3, 2021, by and among (i) Capital Senior Living Corporation, a Delaware corporation (the “Company”), (ii) Silk Partners, LP (the “Silk Investor”), (iii) Conversant Dallas Parkway (A) LP, a Delaware limited partnership (“Investor A”) and (iv) Conversant Dallas Parkway (B) LP, a Delaware limited partnership (“Investor B” and together with Investor A, the “Conversant Investors”). Unless otherwise provided in this Agreement, capitalized terms used herein shall have the meanings set forth in Section 7 hereof.

WHEREAS, the Company and the Conversant Investors entered into an Amended and Restated Investment Agreement, dated as of October 1, 2021 (the “A&R Investment Agreement”), pursuant to which the Conversant Investors agreed, subject to the terms and conditions thereof, to purchase and the Company in a private placement agreed to sell, at the Closing, shares of Series A Convertible Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”), of the Company and shares of Common Stock (such shares of Common Stock, the “Private Placement Common Stock” (for the avoidance of doubt, such term has the same meaning as it has in the A&R Investment Agreement));

WHEREAS, the Company, the Silk Investor and certain other stockholders of the Company entered into a Rights Offering Backstop and Participation Agreement (the “Backstop Agreement”), pursuant to which the Silk Investor agreed, subject to the terms and conditions thereof to fully participate in, and partially backstop, the rights offering contemplated by the A&R Investment Agreement (the “Rights Offering”); and

WHEREAS, the parties hereto desire to enter into this Agreement to govern the rights, duties and obligations of the Company, the Silk Investor and the Conversant Investors following the Rights Offering.

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:

1. Board Matters.

(a) Investor Board Representatives.

(i) For so long as the Conversant Investors together with their Affiliates and Permitted Transferees (the “Conversant Parties”) Beneficially Own at least 33% of the outstanding shares of Common Stock of the Company on an as-converted basis, Investor A shall have the right to designate four (4) designees for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors (which slate shall include a number of nominees equal to the number of director positons to be filled); provided, that one (1) of such designees shall be required to be “independent” in accordance with the relevant rules and regulations in effect at such time of the Securities and Exchange Commission and the New York Stock Exchange (“NYSE”), as determined by the Nominating and Governance Committee of the Board of Directors.

(ii) For so long as the Conversant Parties Beneficially Own less than 33% but at least 15% or more of the outstanding shares of Common Stock of the Company on an as-converted basis, Investor A shall have the right to designate a number of directors, rounded to the nearest whole number, equal to (i) the quotient of (A) the total number of outstanding shares of Common Stock of the Company on an as-converted basis Beneficially Owned by the Conversant Parties divided by (B) the total number of outstanding shares of Common Stock of the Company on an as-converted basis, multiplied by (ii) the total number of directors then on the Board of Directors.

(iii) For so long as the Conversant Parties Beneficially Own less than 15% but at least 5% or more of the outstanding shares of Common Stock of the Company on an as-converted basis, Investor A shall have the right to designate one (1) designee for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors (which slate shall include a number of nominees equal to the number of director positons to be filled).

(iv) Following the forty-two (42) month anniversary of the date hereof, so long as the Conversant Parties Beneficially Own shares of Series A Preferred Stock and Beneficially Own more than 50% of the outstanding shares of Common Stock of the Company on an as-converted basis, Investor A shall have the right to designate five (5) designees for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors (which slate shall include a number of nominees equal to the number of director positons to be filled)

(v) For so long as the Silk Investor together with its Affiliates (the “Silk Parties”) Beneficially Own at least 5% of the outstanding shares of Common Stock of the Company on an as-converted basis, the Silk Investor shall have the right to designate two (2) designees for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors (which slate shall include a number of nominees equal to the number of director positons to be filled).

(vi) Once the Conversant Parties Beneficially Own less than 5% of the outstanding shares of Common Stock of the Company on an as-converted basis, the rights of the Conversant Investors pursuant to this Section 1(a) shall terminate and Investor A shall not have the right to designate a director for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors any directors pursuant to this Agreement. Once the Silk Parties Beneficially Own less than 5% of the outstanding shares of Common Stock of the Company on an as-converted basis, the rights of the Silk Investor pursuant to this Section 1(a) shall terminate and Silk shall not have the right to designate a director for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors any directors pursuant to this Agreement.

(b) Promptly following the Closing Date, and in any event within five (5) Business Days following the Closing Date, the Company shall cause Xxx Xxxxxx, Xxxxx X. Xxxxxxx, Xxxx Xxxxx, Xxxxxx Xxxxxxxxx, Xxx X. Xxxx and Xxxxxx X. Xxxxx to be elected or appointed to the Board of Directors, to the extent not already on the Board of Directors, with Xxx Xxxxxx and Xxxxx X. Xxxxxxx appointed in Class I on the Board of Directors, with Xxxx Xxxxx and Xxxxxx Xxxxxxxxx appointed in Class II on the Board of Directors and with Xxx X. Xxxx and Xxxxxx X. Xxxxx appointed in Class III on the Board of Directors. For so long a party has the right to designate a designee for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors pursuant to Section 1(a) (each, an “Investor Board Representative”), the Company shall cause each Investor Board Representative to be elected or appointed to the Board of Directors (including, to the extent necessary, by expanding the size of the Board of Directors and appointing a number of Investor Board Representatives to the Board of Directors sufficient to maintain the number of Investor Board Representatives set forth in Section 1(a) on the Board of Directors (and, to the extent necessary, calling a special meeting of the Company’s shareholders for the purpose of amending the Company’s Certificate of Incorporation to allow such expansion)). For so long as the Conversant Parties Beneficially Own at least 20% of the outstanding shares of Common Stock on an as-converted basis, Investor A shall be entitled to designate the chairperson of the Board of Directors.

(c) The election or appointment of the Investor Board Representatives will be subject to satisfaction of all legal and governance requirements regarding service as a director of the Company and, for all such appointments or elections after the election or appointment of the initial Investor Board Representatives, to the reasonable approval (which approval shall not be unreasonably withheld, conditioned, or delayed) of the four (4)—member Nominating and Governance Committee of the Board of Directors (two members of which will be comprised of non-Conversant and non-Silk designees). If the Nominating and Governance Committee of the Board does so not approve a designee, Investor A or the Silk Investors (as applicable that made such designation) will have the exclusive right to designate a replacement who shall be treated for all purposes as such person’s designee hereunder, subject to the approval process described in this Section 1(c). The Company shall require that all directors comply in all respects with applicable law (including with respect to confidentiality) and the Company’s corporate governance guidelines, code of business conduct and ethics and confidentiality and trading policies and guidelines in effect from time to time.

(d) So long as Investor A or the Silk Investor has the right to designate an Investor Board Representative to the Board of Directors, members of the Board of Directors other than the Investor Board Representative(s) shall have the exclusive right to designate persons on behalf of the Board of Directors for election at annual stockholders meetings for, or to fill vacancies in, all director positions, other than the Investor Board Representative(s).

(e) Subject to this Section 1, so long as Investor A has the right to designate an Investor Board Representative for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors, the Company shall not, without the prior written approval of Investor A, (i) increase the size of the Board of Directors in excess of nine (9) members or (ii) decrease the size of the Board of Directors if such decrease would require the resignation of an Investor Board Representative nominated by Investor A from the Board of Directors.

(f) The Company will reimburse the Investor Board Representatives for their respective reasonable and documented out-of-pocket expenses incurred in connection with travel to or from and attendance at each meeting of the Board of Directors. Each Investor Board Representative will receive the same director compensation as each other non-executive director of the Board of Directors. Each of Investor A and the Silk Investor agree, upon the Company’s request, to timely provide the Company with accurate and complete information relating to each Investor Board Representative nominated by such party as may be required to be disclosed by the Company under the Exchange Act and the rules and regulations promulgated thereunder.

(g) Notwithstanding any rights to be granted with respect to the Investor Board Representatives hereunder, the Board of Directors may exclude any Investor Board Representative from access to any Board of Directors or committee materials or information or meeting or portion thereof or written consent if the Board of Directors determines, in good faith, including such Investor Board Representative in discussions relating to such determination (but not requiring the affirmative vote of such Investor Board Representative), that such access would reasonably be expected to result in a conflict of interest with the Company; provided, that such exclusion shall be limited to the portion of the Board of Directors or committee material or information and/or meeting or written consent that is the basis for such exclusion and shall not extend to any portion of the Board of Directors or committee material and/or meeting that does not involve or pertain to such exclusion.

(h) Subject to Section 1(c), for so long as Investor A or the Silk Investor has the right to designate an Investor Board Representative for inclusion in the Company’s slate of individuals nominated for election, the Company and the Nominating and Governance Committee of the Board of Directors shall take such action as is required under applicable law, the rules and regulations in effect at such time of the NYSE or such other market on which the Common Stock is then listed or quoted or under the Bylaws or Certificate of Incorporation to include on the Board of Directors or in the slate of nominees recommended by the Board of Directors such person nominated pursuant to Section 1. The Company shall use its reasonable best efforts to have the Investor Board Representatives elected as a director of the Company and the Company shall solicit proxies for such persons to the same extent as it does for any of its other nominees to the Board of Directors.

(i) For so long as Investor A or the Silk Investor has the right to designate an Investor Board Representative, in the event that a vacancy is created at any time by the death, disability, retirement, resignation or removal of an Investor Board Representative, Investor A or the Silk Investor (as applicable) may designate, another individual to be elected to fill the vacancy created thereby, and the Company hereby agrees to take, at any time and from time to time, all actions necessary to accomplish the same.

(j) So long as Investor A or the Silk Investor has the right to designate an Investor Board Representative for inclusion in the Company’s slate of individuals nominated for election to the Board of Directors, any transaction, agreement, contract or other arrangement (including without limitation, with respect to Investor A, any mandatory conversion pursuant to Section 7 of the Certificate of Designations and any optional

redemption of the Series A Preferred Stock pursuant to the Certificate of Designations) by and among the Company or any of its Subsidiaries, on the one hand, and any the Conversant Investors or the Silk Investor or their respective Affiliates, on the other hand, shall solely require the approval of a majority of the independent and disinterested directors (which, for the avoidance of doubt, in the case of Investor A may include any Investor Board Representative designated by the Silk Investor and in the case of the Silk Investor may include any Investor Board Representatives designated by Investor A). Investor A and the Silk Investor shall notify and fully inform the full Board of Directors of any actual or potential conflict of interest that arises due to any such proposed transaction, agreement, contract or other arrangement with such party or its Affiliates.

(k) In the event that Investor A or the Silk Investor ceases to have the right to designate a director pursuant to Section 1(a) (or the number of directors which Investor A has the right to designate in reduced in accordance with the terms of Section 1(a)), any applicable Investor Board Representative will not be required to resign (and Investor A or the Silk Investor (as applicable) will not be required to cause them to resign), such Investor Board Representative shall continue to serve until the next regularly scheduled annual stockholders meeting at which directors are to be elected, and the related rights, including pursuant to Section 1(d), shall continue to apply until such time. All obligations of the Company pursuant to this Section 1 relating to any such Investor Board Representative shall not apply to such election or at any time thereafter.

2. Transfer Restrictions.

(a) Other than Permitted Transfers, the Conversant Investors shall not Transfer any shares of Series A Preferred Stock (or any shares of Common Stock issued upon conversion thereof) (together, the “Prohibited Shares”) during the period commencing on the Closing Date and continuing until the date that is the second anniversary of the Closing Date (such date, the “Restricted Period Termination Date”).

(b) “Permitted Transfer” means, in each case so long as such Transfer is in accordance with applicable law:

(i) a Transfer of Prohibited Shares to Affiliates of a Conversant Investor, so long as such transferee, to the extent it has not already done so, executes a customary joinder to this Section 2, in form and substance reasonably acceptable to the Company, in which such transferee agrees to be subject to the restrictions on Transfer in this Section 2;

(ii) a Transfer of Prohibited Shares as a distribution in-kind to a Conversant Investor’s investors, and to their subsequent investors, including limited partners, so long as each such transferee, to the extent it has not already done so, executes a customary joinder to this Section 2, in form and substance reasonably acceptable to the Company, in which such transferee agrees to be subject to the restrictions on Transfer in this Section 2;

(iii) a Transfer of Prohibited Shares in connection with a sale of the Company approved by the Board of Directors or in connection with a tender offer into which a majority of the Unaffiliated Shareholders of the Company have tendered their respective shares of Common Stock;

(iv) a Transfer of Prohibited Shares to the Company; and

(v) a Transfer of Prohibited Shares following a voluntary filing by the Company of a petition for relief under the United States Bankruptcy Code.

(c) “Permitted Transferee” means, any transferee that receives Prohibited Shares pursuant to Section 2(b) clauses (i) or (ii).

(d) Notwithstanding anything to the contrary contained herein, including the occurrence of the Restricted Period Termination Date, the Conversant Investors shall not Transfer any Prohibited Shares (i) other than in accordance with all applicable laws and the other terms and conditions of this Agreement and (ii) other than any Transfers that are made pursuant to a registered offering or in accordance with an exemption from registration. Any Transfers of Prohibited Shares prior to the third anniversary of the date hereof shall only be made to a Person that, to such Conversant Investor’s knowledge, is not a competitor of the Company set forth on Schedule A attached hereto.

(e) The Company may impose stop-transfer instructions and may stamp each certificate representing the Prohibited Shares with an appropriate legend to enforce the provisions of this Section 2. Any purported Transfer or other transaction in violation of this Section 2 shall be null and void.

3. Standstill.

(a) For a period of eighteen (18) months from the date of this Agreement, each Conversant Investor shall not, and shall cause its Affiliates not to, directly or indirectly:

(i) acquire, offer to acquire or agree or make a proposal to acquire Beneficial Ownership of any Equity Securities, any Derivative Instruments with respect to Common Stock, or any indebtedness of the Company, except pursuant to share splits, reverse share splits, share dividends or distributions, or combinations or any similar recapitalizations on or after the date hereof or the acquisition of common stock resulting from conversion of the Series A Preferred Stock;

(ii) effect or seek, offer or propose to effect, or announce any intention to effect or cause or participate in (A) any shareholder proposal to be considered by the stockholders of the Company or take any action to nominate any person for membership on the Board of Directors, or take any action to remove any director (other than the Investor Board Representative) from the Board of Directors of the Company or to change the composition of the Board of Directors of the Company or (B) make, or in any way participate in, directly or indirectly, any “solicitation” of “proxies” to vote, or seek to influence any Person with respect to the voting of, shares of Common Stock, or become a “participant” in a “solicitation” (as such terms are defined in Regulation 14A under the Exchange Act) with respect to Common Stock; provided that the foregoing shall not restrict such Conversant Investor’s right to vote its Common Stock in its sole discretion; or

(iii) initiate or propose a call for any special meeting of the Company’s shareholders.

(b) The prohibition in Section 3(a)(i) shall not restrict (i) the ability of an Investor Board Representative nominated by Investor A to vote or from otherwise exercising his or her fiduciary duties, (ii) each Conversant Investor’s ability to vote, Transfer, convert or otherwise exercise rights under its shares of Series A Preferred Stock subject to the express obligations hereof.

4. Consent Rights. So long as the Conversant Parties Beneficially Own at least 15% of the outstanding shares of Common Stock on an as-converted basis, the Company shall not, without the prior approval or written consent of Investor A (such approval or consent not to be unreasonably withheld, conditioned or delayed):

(a) materially change the principal business of the Company, enter into new lines of business or exit the Company’s current line of business;

(b) enter into an agreement with respect to, or consummate, any acquisition (whether by merger, stock purchase, asset purchase or otherwise) of another business or Person involving the payment, contribution or assignment by or to the Company or its subsidiaries of money or assets in an amount exceeding $10,000,000;

(c) with respect to the Company only, issue Equity Securities of the Company from and after the date of this Agreement that, assuming full conversion or exercise of convertible and exercisable securities, would represent in the aggregate either (i) a value equal to or greater than 20% of the Company’s outstanding shares of Common Stock on an as-converted basis as of the date of this Agreement based on the Current Market Price (as defined in the Certificate of Designations) or (ii) a number of shares of Common Stock equal to or greater than 20% of the number of shares of Common Stock outstanding on an as-converted basis as of the date of this Agreement, in each case after taking into account the issuance of the Series A Preferred Stock to the Conversant Investors and the closing of the rights offering contemplated by the A&R Investment Agreement;

(d) sell or otherwise Transfer Equity Securities of any Subsidiary of the Company to a Person other than the Company or a wholly owned Subsidiary and with respect to any Subsidiary of the Company, issue or sell any Equity Securities of such Subsidiary;

(e) enter into an agreement with respect to (or otherwise consummate) a Change of Control (as defined in the Certificate of Designations);

(f) consummate any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company or file a petition under bankruptcy or insolvency law;

(g) purchase or redeem or make any distribution or declare any dividend on Equity Securities of the Company or any of its Subsidiaries ranking junior to the Series A Preferred Stock other than (i) redemptions of or dividends or distributions on the Series A Preferred Stock or in which the Series A Preferred Stock participates pursuant to the Certificate of Designations, (ii) dividends or other distributions payable on the Common Stock solely in the form of additional shares of Common Stock, and (iii) repurchases or redemptions if at such time any accrued dividends on the Series A Preferred Stock have been paid in full in cash;

(h) other than refinancings of existing Indebtedness on substantially the same commercial terms, for any given calendar year, incur Indebtedness such that the aggregate amount of Indebtedness of the Company and its Subsidiaries immediately after such incurrence is in excess of 105% of the aggregate amount of Indebtedness of the Company and its Subsidiaries in the prior year as of December 31 (for purposes of 2022, the reference amount of Indebtedness for the prior calendar year shall be the aggregate amount of Indebtedness of the Company immediately following the Closing); and

(i) with respect to the Company only, authorize, create, classify, reclassify or issue any Parity Stock (as defined in the Certificate of Designations), any additional shares of Series A Preferred Stock (other than as contemplated by the A&R Investment Agreement) or Senior Stock (as defined in the Certificate of Designations).

5. Preemptive Rights.

(a) So long as the Conversant Parties Beneficially Own at least 14.9% of the outstanding shares of Common Stock on an as-converted basis, each Conversant Investor will have the preemptive rights set forth in this Section 5 with respect to any issuance of any Equity Securities that are issued after the date hereof (any such issuance, other than those described in clauses (i) through (vi) below, a “Preemptive Rights Issuance”), except for (i) issuances of any shares of Common Stock or options or rights to purchase such shares or other form of equity-based or equity-related awards (including restricted stock units) to employees (or prospective employees who have accepted an offer of employment), directors or consultants, or pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by the Company or any of its Subsidiaries or of any employee agreements or arrangements or programs in effect as of the Closing Date (including the New LTIP (as defined in the A&R Investment Agreement)), or thereafter adopted by the Board of Directors, (ii) issuances of securities pursuant to any merger, joint venture, partnership, consolidation, dissolution, liquidation, tender offer, recapitalization, reorganization, share exchange, business combination or similar transaction or any other direct or indirect acquisition by the Company, whereby the Company’s securities comprise, in whole or in part, the consideration paid by the Company in such transaction, which transaction has been approved by the Board of Directors and, to the extent then applicable, approved by Investor A in accordance with Section 4, (iii)

issuances of shares of Common Stock upon conversion or exercise of any of preferred stock, option or Derivative Instrument, in each case, outstanding as of the Closing Date or if issued after the Closing Date, were either exempt from Investor A’s rights under this Section 5(a) or were offered to the Conversant Investors in accordance with this Section 5, (iv) by reason of a dividend, stock split or other distribution of Common Stock, (v) issuances of any shares of Series A Preferred Stock pursuant to the terms of the A&R Investment Agreement (including issuances of Common Stock upon conversation of such shares of Series A Preferred Stock in accordance with the Certificate of Designations), or (vi) issuances of any Equity Securities with respect to which Investor A waives in writing the rights of all of the Conversant Investors pursuant to this Section 5.

(b) If the Company at any time, or from time to time, effects a Preemptive Rights Issuance, the Company shall give prompt written notice to the Conversant Investors and each of their Affiliates party to this Agreement that holds any Equity Securities of the Company (each, an “Investor Holder”) (but in no event later than ten (10) days prior to such issuance), which notice shall set forth the number and type of the securities to be issued, the issuance date, the offerees or transferees, the price per security, and all of the other terms and conditions of such issuance, which shall be deemed updated by delivery of the final documentation for such issuance to the Conversant Investors. Each Investor Holder may, by written notice to the Company (a “Preemptive Rights Notice”) delivered no later than ten (10) days after receipt of the Preemptive Rights Notice, elect to purchase a number of securities specified in such Preemptive Rights Notice (which number may be any number up to but not exceeding the number of securities which, if divided by the sum of (i) such number of securities plus (ii) the number of securities issued in such Preemptive Rights Issuance, would represent a percentage that is equal to (A) the aggregate number of shares of Common Stock (on an as-converted basis if applicable) that such Investor Holder owns immediately prior to such Preemptive Rights Issuance, divided by (B) the total number of shares of Common Stock then outstanding on an as-converted basis), on the same terms and conditions as such Preemptive Rights Issuance (it being understood and agreed that the price per security that the Investor Holders shall pay shall be the same as the price per security set forth in the Preemptive Rights Notice); provided, that any Investor Holder shall not be entitled to acquire any such shares of Common Stock to the extent the issuance of such Common Stock to such Investor Holder would require approval of the stockholders of the Company pursuant to the rules and listing standards of NYSE, in which case the Company may consummate the proposed issuance prior to obtaining approval of the stockholders of the Company (subject to compliance by the Company with Section 5(d)). If an Investor Holder exercises its preemptive rights hereunder with respect to such Preemptive Rights Issuance, the Company shall (or shall cause such Subsidiary to) issue to such Investor Holder (or its designated Affiliate(s)) the number of securities specified in such Preemptive Rights Notice promptly thereafter (and provided that, if such Investor Holder shall have so notified the Company at least three Business Days prior to the issuance date set forth in the Company’s notice, at such Investor Holder’s election such purchase and sale shall occur on the same date as, or substantially concurrently with, the Preemptive Rights Issuance).

(c) The election by any Investor Holder not to exercise its preemptive rights hereunder in any one instance shall not affect its right as to any future Preemptive Rights Issuances.

(d) Notwithstanding anything to the contrary in this Agreement, in the event that any Investor Holder exercises its preemptive rights pursuant to this Section 5 and the purchase or issuance of such securities would require the Company to obtain approval of its stockholders pursuant to the listing rules of the NYSE or such national securities exchange that the Common Stock is listed upon, if any, the Company and the Investor Holder will use their respective commercially reasonable efforts to negotiate in good faith the terms of any such transaction, including without limitation the terms of any securities of the Company issued pursuant to such transaction to the Investor Holder, such that the issuance to the Investor Holder would not require such stockholder approval while providing the Investor Holder and/or its Affiliates with substantially similar benefits and rights of such securities issued in the Preemptive Rights Issuance.

6. Confidentiality. Each Conversant Investor and the Silk Investor will hold, and will cause its respective Affiliates and their respective directors, managers, officers, employees, agents, consultants and advisors to hold, in strict confidence, unless disclosure to a regulatory authority is necessary in connection with any reasonably necessary regulatory approval, examination or inspection or unless disclosure is requested or required by judicial or administrative process or by other requirement of law or the applicable requirements of any regulatory agency or relevant stock exchange (in which case, other than in connection with a disclosure in connection with a routine audit or examination by, or document request from, a regulatory or self-regulatory authority, bank examiner or auditor, the party disclosing such information shall provide the other party with prior written notice of such permitted disclosure to the extent legally permitted), all non-public records, books, contracts, instruments, computer data and other data and information (collectively, “Information”) concerning the Company furnished to such party by or on behalf of the Company or its representatives (except to the extent that such information (a) was previously known by such party from other sources, provided that such source was not known by such party to be bound by a contractual, legal or fiduciary obligation of confidentiality to the other party in relation to such information, (b) becomes available to the public through no violation of this Section 6 by such party, (c) is later lawfully acquired from other sources by the party to which it was furnished, or (d) is independently developed without use of or reference to the Information), and neither party hereto shall release or disclose such Information to any other Person, except its directors, officers, employees, members, auditors, attorneys, financial advisors, financing sources and other consultants and advisors (“Representatives”) (it being understood that each Conversant Investor and the Silk Investor will be responsible for any breach of the terms of this Section 6 by any of its Representatives). Nothing herein shall prevent any Conversant Investor, the Silk Investor, or any of their respective Affiliates which is a private equity or other investment fund from making customary disclosures to its current, future or potential investors, in each case so long as the recipient of such information is subject to a written confidentiality agreement, policy or obligation. Each Conversant Investor and the Silk Investor confirms that it is aware and that its Representatives have been advised that the United States securities laws prohibit any Person who has material non-public information about a company from purchasing or selling securities of such company on the basis of such information or from communicating such information to any other Person under circumstances in which it is reasonably foreseeable that such Person may purchase or sell such securities.

7. Interpretation; Other Definitions. Wherever required by the context of this Agreement, the singular shall include the plural and vice versa, and the masculine gender shall include the feminine and neuter genders and vice versa, and references to any agreement, document or instrument shall be deemed to refer to such agreement, document or instrument as amended, supplemented or modified from time to time. All article, section, paragraph or clause references not attributed to a particular document shall be references to such parts of this Agreement, and all exhibit, annex, letter and schedule references not attributed to a particular document shall be references to such exhibits, annexes, letters and schedules to this Agreement. In addition, the following terms are ascribed the following meanings:

(a) the word “or” is not exclusive.

(b) the words “including,” “includes,” “included” and “include” are deemed to be followed by the words “without limitation.”

(c) the terms “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular section, paragraph or subdivision.

(d) “as-converted basis” means, with respect to the Company’s outstanding Common Stock, on a basis in which all shares of Common Stock issuable upon conversion of the Series A Preferred Stock and conversion, exchange or exercise of any other security convertible into or exchangeable or exercisable for Common Stock, whether or not the Series A Preferred Stock or other convertible, exchangeable or exercisable security is then convertible, exchangeable or exercisable by the holder, are assumed to be then outstanding.

(e) “Beneficial Owner,” “Beneficially Own” or “Beneficial Ownership” has the meaning assigned to such term in Rule 13d-3 under the Exchange Act, and a Person’s Beneficial Ownership of securities shall be calculated in accordance with the provisions of such Rule (in each case, irrespective of whether or not such Rule is actually applicable in such circumstance).

(f) “Affiliate” of any Person, means any other Person that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such first Person; provided, however, that for purposes of this Agreement, the Company and its Subsidiaries shall not be deemed to be Affiliates of the Conversant Investors or their respective Affiliates. As used in this definition, the term “control,” including the correlative terms “controlling,” “controlled by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise).

(g) “Board of Directors” mean the Board of Directors of the Company.

(h) “Business Day” means any day that is not a Saturday, Sunday or other day on which banking institutions in New York City are authorized or required by law to remain closed (other than Lincoln’s Birthday or Election Day, which shall be considered Business Days).

(i) “Bylaws” mean the Second Amended and Restated Bylaws of the Company.

(j) “Certificate of Designations” means the Certificate of Designation, Preferences and Rights, filed with the Secretary of State of the State of Delaware with respect to the Series A Preferred Stock prior to the Closing, as may be amended from time to time in accordance with applicable law, this Agreement and the terms thereof.

(k) “Certificate of Incorporation” means the Amended and Restated Certificate of Incorporation of the Company, as modified by the Certificate of Amendment dated August 27, 1999, the Certificate of Amendment dated December 11, 2020 and the Certificate of Amendment dated November 3, 2021 and as may be further amended from time to time in accordance with applicable law, the Certificate of Designations and this Agreement.

(l) “Closing” means the closing of transactions contemplated by the to the A&R Investment Agreement, including the sale of Series A Preferred Stock and the Private Placement Common Stock to the Conversant Investors.

(m) “Closing Date” means the date on which the Closing occurs.

(n) “Common Stock” means the Common Stock of the Company, par value $0.01 per share.

(o) “Derivative Instruments” means any and all derivative securities (as defined under Rule 16a-1 under the Exchange Act) that increase in value as the value of any Equity Securities of the Company increases, including a long convertible security, a long call option and a short put option position, in each case, regardless of whether (i) such derivative security conveys any voting rights in any Equity Security, (ii) such derivative security is required to be, or is capable of being, settled through delivery of any Equity Security or (iii) other transactions that hedge the value of such derivative security.

(p) “Encumbrance” means any mortgage, commitment, transfer restriction, deed of trust, pledge, option, power of sale, retention of title, right of pre-emption, right of first refusal, executorial attachment, hypothecation, security interest, encumbrance, claim, lien or charge of any kind, or an agreement, arrangement or obligation to create any of the foregoing.

(q) “Equity Securities” means any and all (i) shares, interests, participations or other equivalents (however designated) of capital stock or other voting securities of a corporation, any and all equivalent or analogous ownership (or profit) or voting interests in a Person (other than a corporation), (ii) securities convertible into or exchangeable for shares, interests, participations or other equivalents (however designated) of capital stock

or voting securities of a corporation, and securities convertible into or exchangeable for any equivalent or analogous ownership (or profit) or voting interests in a Person (other than a corporation), and (iii) any and all warrants, rights or options to purchase any of the foregoing, whether voting or nonvoting, and, in each case, whether or not such shares, interests, participations, equivalents, securities, warrants, options, rights or other interests are authorized or otherwise existing on any date of determination.

(r) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor federal law then in force, together with all rules and regulations promulgated thereunder.

(s) “Indebtedness” means, with respect to any Person, without duplication (i) any indebtedness of such Person for borrowed money; (ii) any other indebtedness of such Person that is evidenced by a note, bond, debenture or similar instrument; (iii) all obligations of such Person under any financing leases; (iv) all liabilities secured by any Encumbrance on any real property owned by such Person even though such Person has not assumed or otherwise become personally liable for the payment thereof; (v) any obligation under any factoring, securitization or other similar facility or arrangement; (vi) any reimbursement obligation with respect to drawn letters of credit (including standby letters of credit to the extent drawn upon), bankers’ acceptances or similar facilities; (vii) any obligation issued or assumed as the deferred purchase price of property; (viii) all net obligations of such Person under interest rate, commodity, foreign currency and financial markets swaps, options, futures and other hedging obligations; and (ix) all guaranties of such Person in respect of Indebtedness of others.

(t) “Person” means any individual, corporation, partnership, limited liability company, association or trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

(u) “Subsidiary” means, with respect to any Person, another Person of which 50% or more of the voting power of the equity securities or equity interests is owned, directly or indirectly, by such Person.

(v) “Transfer” means (i) any direct or indirect sale, lease, assignment, Encumbrance, disposition or other transfer (by operation of law or otherwise), either voluntary or involuntary, or entry into any contract, option or other arrangement or understanding with respect to any sale, lease, assignment, Encumbrance, disposition or other transfer (by operation of law or otherwise), of any Equity Security or (ii) to enter into any Derivative Instrument, swap or any other contract, agreement, transaction or series of transactions that xxxxxx or transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of any Equity Security, whether any such Derivative Instrument, swap, contract, agreement, transaction or series of transactions is to be settled by delivery of securities, in cash or otherwise. For purposes of this Agreement, no Transfer of any direct or indirect membership, partnership or other equity interest in a Conversant Investor or any of its Affiliates shall be deemed to be a Transfer of all or any portion of any Equity Securities of the Company held by such Person; provided, in each case, after such Transfer of any direct or indirect membership, partnership or other equity interest in such Conversant Investor or any of its Affiliates, such Conversant Investor or Affiliate shall remain an Affiliate of Conversant Capital LLC.

(w) “Unaffiliated Shareholders” means the shareholders of the Company, other than (i) the Conversant Investors, (ii) any Affiliates or representatives of the Conversant Investors or any Person acting for or on behalf of a Conversant Investor or (iii) any shareholder that is a member of a “group” (within the meaning of Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder) with a Conversant Investor.

8. Miscellaneous.

(a) Notices. Any notice, request, instruction or other document to be given hereunder by any party to the other will be in writing and will be deemed to have been duly given (i) on the date of delivery if delivered personally or by telecopy, facsimile or electronic mail (so long as such transmission does not generate an error message or notice of non-delivery), (ii) on the first business day following the date of dispatch if delivered by a recognized next-day courier service, or (iii) on the third business day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid. All notices hereunder shall be delivered as set forth below, or pursuant to such other instructions as may be designated in writing by the party to receive such notice:

if to the Company, to:

Capital Senior Living Corporation

00000 Xxxxxx Xxxxxxx, Xxxxx 000

Xxxxxx, Xxxxx 00000

Attention: General Counsel

Email: [Redacted]

with a copy to (which shall not constitute notice):

Xxxxxxx Xxxx & Xxxxxxxxx LLP

000 Xxxxxxx Xxxxxx

Xxx Xxxx, Xxx Xxxx 00000

Attention: Xxxxxx X. Xxxxxxx

Xxxxx X. Xxxxx

Email: xxxxxxxx@xxxxxxx.xxx; xxxxxx@xxxxxxx.xxx

if to a Conversant Investor, to:

c/o Conversant Capital LLC

00 Xxxxxxxx Xxxxxx

Xxxxxx, Xxx Xxxxxx 00000

Attention: Xxxxx X’Xxxxxx

Email: [Redacted]

with a copy to (which shall not constitute notice):

Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx LLP

Xxx Xxx Xxxx Xxxxx

Xxx Xxxx, Xxx Xxxx 00000

Attention: Xxxx X. Xxxxxx

Email: xxxx.xxxxxx@xxxxxxxxxx.xxx

if to the Silk Investor, to:

Silk Partners, LP

000 Xxxxxxx Xxxxxx, 00xx Xxxxx

Xxx Xxxx, Xxx Xxxx 00000

Attention: Xxxxxx Xxxxxxxxx

Email: [Redacted]

with a copy to (which shall not constitute notice):

Xxxxxxxx & Xxxxxxxx LLP

000 Xxxxx Xxxxxx

Xxx Xxxx, Xxx Xxxx 00000

Attention: Xxxxxx Xxxxxxx

Email: xxxxxxxx@xxxxxxxx.xxx

(b) Entire Agreement; Effectiveness. This Agreement constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions among the parties hereto, written or oral, with respect to the subject matter hereof. This Agreement shall be automatically effective as of the Closing (as defined in the A&R Investment Agreement), without further action by any party hereto. If the A&R Investment Agreement is terminated for any reason, then this Agreement shall be void and of no force and effect.

(c) Amendment; Waiver. No amendment or waiver of any provision of this Agreement will be effective with respect to any party unless made in writing and signed by an officer of a duly authorized representative of such party. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. No waiver of any party to this Agreement will be effective unless it is in a writing signed by a duly authorized officer of the waiving party that makes express reference to the provision or provisions subject to such waiver. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.

(d) Assignment. Subject to the restrictions on Transfers provided herein, this Agreement shall benefit and bind the respective transferees, successors and permitted assigns of the parties. Neither this Agreement, nor any of the rights, interests or obligations hereunder shall be assigned by any of the Company (whether by operation of law or otherwise) without the prior written consent of Investor A (not to be unreasonably withheld, conditioned or delayed). Any purported assignment or other Transfer without such consent shall be void and unenforceable. Following the third anniversary of the date of this Agreement, the Conversant Investors, together, may assign all, but not less than all, of their rights, benefits and obligations hereunder in connection with a Transfer of a majority of the aggregate of the Prohibited Shares and the Private Placement Common Stock. Upon any Transfer by the Conversant Investors of all of their rights, benefits and obligations hereunder, any reference to “Investor A” or “Conversant Investor,” as applicable, (including as used in this Section 8(d)) shall refer to such transferee and the Conversant Investors shall cease to have any rights under this Agreement. Notwithstanding anything else to the contrary in this Agreement, with written notice to the Company, the Conversant Investors may at any time assign the rights of Investor A pursuant to Section 1 and Section 4 to any other Conversant Investor or Permitted Transferee thereof and upon any such assignment, any reference to “Investor A” shall refer to such other Conversant Investor or Permitted Transferee, as applicable.

(e) Severability. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, other than those as to which it has been held invalid or unenforceable, will remain in full force and effect and shall in no way be affected, impaired or invalidated thereby. Upon such determination, the parties shall negotiate in good faith in an effort to agree upon a suitable and equitable substitute provision to effect the original intent of the parties.

(f) Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument. Counterparts may be delivered via electronic mail (including .pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., xxx.xxxxxxxx.xxx) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

(g) Applicable Law; Consent to Jurisdiction. This Agreement and any disputes arising out of or relating to this Agreement and the transactions contemplated hereby (whether in contract, tort or otherwise) will be governed by and construed in accordance with the laws of the State of Delaware without giving effect to any conflict or choice of law principles of the State of Delaware or otherwise that would result in the application of any laws other than the laws of the State of Delaware. The parties hereby irrevocably and unconditionally consent to submit to the exclusive jurisdiction and venue of the Court of Chancery of the State of Delaware (or, only if the Court of Chancery of the State of Delaware declines to accept jurisdiction over a particular matter, any state or federal court in the State of Delaware) for any actions, suits or proceedings arising out of or relating to this Agreement and the transactions contemplated hereby. The parties hereby irrevocably and unconditionally consent to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such action, suit or proceeding and irrevocably waive, to the fullest extent permitted by law, any objection that they may now or hereafter have to the laying of the venue of any such action, suit or proceeding in any such court or that any such action, suit or proceeding which is brought in any such court has been brought in an inconvenient forum. Process in any such action, suit or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in Section 8 shall be deemed effective service of process on such party.

(h) Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF THE FOREGOING WAIVERS, (II) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER, (III) IT MAKES SUCH WAIVER VOLUNTARILY, AND (IV) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER IN THIS SECTION 8(h).

(i) No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

* * * * *

IN WITNESS WHEREOF, the parties hereto have executed this Investor Rights Agreement as of the date first written above.


COMPANY:

CAPITAL SENIOR LIVING CORPORATION

By:		/s/ Xxxxxxxx X. Xxxx
Name:		Xxxxxxxx X. Xxxx
Title:		President and Chief Executive Officer

[Signature Page to Investor Rights Agreement]

IN WITNESS WHEREOF, the parties hereto have executed this Investor Rights Agreement as of the date first written above.


CONVERSANT DALLAS PARKWAY (A) LP

By: Conversant GP Holdings LLC, its general partner

By:		/s/ Xxxxxxx Xxxxxxxxxx
Name:		Xxxxxxx Xxxxxxxxxx
Title:		Manager

CONVERSANT DALLAS PARKWAY (B) LP

By: Conversant GP Holdings LLC, its general partner

By:		/s/ Xxxxxxx Xxxxxxxxxx
Name:		Xxxxxxx Xxxxxxxxxx
Title:		Manager

[Signature Page to Investor Rights Agreement]

IN WITNESS WHEREOF, the parties hereto have executed this Investor Rights Agreement as of the date first written above.


SILK PARTNERS, LP

By:		/s/ Xxxxxxx Xxxxxxxxx
Name:		Xxxxxxx Xxxxxxxxx
Title:		Manager

[Signature Page to Investor Rights Agreement]

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INVESTOR RIGHTS AGREEMENT among CAPITAL SENIOR LIVING CORPORATION, SILK PARTNERS, LP, CONVERSANT DALLAS PARKWAY (A) LP and CONVERSANT DALLAS PARKWAY (B) LP dated as of November 3, 2021

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