7A Request from Presbyterian Homes for Conduit Financing

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Section 4.8 Natification af Chan es. The Borrower covenants and agrees that it will promptly notify the Lender of: {1) any litigation vcrhich might materially and adversely affect the Borrower or any of its properties; (2) the occurrence of any Event of Default unc�er this Agreement or under any other Ioan agreement, debenture, note, purchase a�reemeni or any other agreement providing for the borrowing o#'money by ihe Borrower or any event of which the Borrower has knowledge and wh'rch, with ihe passage of time ar giving of notice, ar both, vvauld constitute an Event of Defauli under this Loan Agxeement or under such other agreemen�s; and (3) any material adverse change in the operations, business, properties, assets or conditions, financial or othervvise, of the Borrower. Section 4.9 Financial Covenants. Except as atherwise stated in this Agreement, all financ'ral informaiion provided to the Lender sha11 be compiled using generally accepted accounting principles consistenily applied. During the term oi this Agreernent, and afterward until all amounts due under this Agreement are paid in full, unless ihe Lender shall otherwise agree in writing, the Borrower agrees to: (1} Provide the Lender within 180 days of the Borrower's fiscal year end, the Borrower's annual financial s#aternents for the fiscal year then ending, in form acceptable to the Lender and certified as correct by an officer of the Borrower acceptable to the Lender. The statements must be audited with an unqualified opinion by a certified public accoun�ant acceptable io the Lender. (2} Pror�ide ihe Lender with such athez infortnation as it may reasonably request from time io time. {3) Maintain a Debt Servzce Coverage Ratio of at least 1.00 for each Fiscal Year comrnencing wath the Fiscal Year ending 7une 3Q, 2009. If, in a Fiscal Year the Debt Service Coverage Ratio is less than L00 for such Fiscal Year, the Barrower at its expense shall retain an independent cansultant acceptable to the Lendex to make recoxnmendations wiih respect to the Bor�-ower's rates, fees and charges and other rx�atters relating ta or affecting said Debt Service Coverage Ratio, provided that if the Borrower shall have employed an independent consultant pursuar�� to this Sui�section on a continuing basis, the Borrower shall nat be required to exnploy a new independent consultant or obtain new recommen�ations. A copy of the independent con.sultani's report and recornmendations and any supplements thereto shall be filed with ihe Borrower and the Lender. The recommendatians of the independent consultant and any supplements thereto shall be pres�nted by the independeni consultant in writing to the Board of Directors of the Borrower. The Borrower agrees that it will, to �e extent permitted by law, follow the recommendatians of the independent consultant unless #he Board of Directors of the Borrower in gaod faith resolves in a writing delivered to the Lender on or be�ore 45 days of receipt of the recommendations of the i�xdependent consultant that such recommendaiions are nai in the best interests of tl�e Borrower and that a proposed alternate set of recommendations of management are likely to achieve the 1.00 Debt Service Coverage Ratio set for� in this 2208845v4 16