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AMENDMENT TO PURCHASE AGREEMENT
THIS AMENDMENT TO PURCHASE AGREEMENT (the "Amendment") is entered into
as of the 5th day of December, 1996, by and between Sunrise Development, Inc.
("Purchaser") and Xxxxxxxx Senior Properties, Ltd. ("Seller").
W I T N E S S E T H:
WHEREAS, Purchaser and Seller have entered into that certain Purchase
Agreement, dated as of the 4th day of October, 1996 (hereinafter referred to as
the "Agreement"), regarding the sale of the real and personal property known as
Hillcrest Inn, located in Thousand Oaks, California, and real and personal
property known as Sterling Canyon Inn, located in Valencia, California and as
more fully described in the Agreement; and
WHEREAS, by letter dated December 3, 1996, the parties extended the
Study Period for an additional two (2) days, to December 5, 1996; and
WHEREAS, Seller and Purchaser desire to amend certain terms of the
Agreement, as more fully set forth hereinbelow.
NOW THEREFORE, for and in consideration of the mutual promises and
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto do
hereby agree to amend the Agreement as follows:
1. The parties have agreed that Purchaser will purchase and acquire
from Seller and Seller will sell, convey, transfer and assign to Purchaser only
that real and personal property described in the Agreement as Sterling Canyon
Inn, located in Valencia, California. Any reference in the Agreement to
"Facilities," "Land," "Real Properties," and "Properties" shall hereinafter
refer solely to Sterling Canyon Inn. Any reference in the Agreement to the
property known as Hillcrest Inn, located in Thousand Oaks, California, is hereby
deleted.
2. Pursuant to this Amendment, Purchaser shall no longer have an
obligation to purchase from Seller the property known as Hillcrest Inn, located
in Thousand Oaks, California, and the Agreement shall be considered terminated
as to the purchase of Hillcrest Inn. Within seven (7) days following this
Amendment, Purchaser shall deliver to Seller all materials heretofore provided
to Purchaser respecting Hillcrest Inn.
3. The Purchase Price, as defined in Section 3 of the Agreement, is
hereby amended to be Thirteen Million Seven Hundred Fifty Thousand and no/100
Dollars ($13,750,000.00) and shall be the Purchase Price for the Sterling Canyon
Inn property only.
4. No later than December 11, 1996, Seller agrees to notify the
Department of Social Services and the residents of Sterling Canyon Inn of the
intended sale of the Property, as required under Section 1569.191 of the
California regulations regarding Residential Care for the Elderly (the
"Regulations"). In addition, Seller agrees to notify the employees of Sterling
Canyon Inn and any other interested third parties, within such period, of the
intended sale. Seller shall forward to Purchaser any proposed resident and
employee notification letters and any other
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communications regarding the sale prior to their release for Purchaser's
approval, which shall not be unreasonably withheld. Purchaser shall also have
the right, at any time on or after December 16, 1996, to affect its own
notification and other communications to residents and employees of Sterling
Canyon Inn and any other interested third parties. Purchaser shall forward to
Seller any intended communication prior to its release for Seller's approval,
which shall not be unreasonably withheld. Purchaser has prepared a proposed
Communication Plan, including proposed communications from Purchaser to the
residents and employees of Sterling Canyon Inn, which Communication Plan is
attached hereto as Exhibit A. The parties shall have two (2) business days from
receipt of any proposed communication in which to comment on such communication,
and any failure to comment within such two (2) day period shall be deemed an
approval.
5. To the extent required under the California Regulations, Seller
agrees to extend the closing for up to thirty (30) days following notification
to the residents of the proposed transaction.
6. Purchaser represents to Seller that Purchaser has made timely
application to the California Department of Social Services for a license to
operate Sterling Canyon Inn, as required under Section 8(b)(ii) of the
Agreement, and is awaiting the issuance of such license. Purchaser shall
concurrent with this Amendment provide Seller with a copy of such application
and shall keep Seller apprised of the status of such application. In the event
Purchaser has extended the Purchase Agreement for an additional thirty (30) days
and deposited an additional Deposit of $100,000.00 as described in Section 6(d),
but has not received a license to operate Sterling Canyon Inn by the expiration
of such extension period, and the parties agree that such license can reasonably
be obtained within an additional sixty (60) days, Seller agrees to extend the
Purchase Agreement for up to an additional sixty (60) days pursuant to Section
8(c).
7. In order to allow Purchaser the ability to prepare for its
employment needs at Sterling Canyon Inn, Seller agrees to notify Purchaser no
later than three (3) weeks prior to Closing regarding the permanent transfer of
any Sterling Canyon Inn employee to any other Xxxxxxxx-owned facility. Seller
represents and covenants that it will not solicit the transfer of any Sterling
Canyon Inn employees to any other Xxxxxxxx-owned facility within the three (3)
week period prior to Closing.
8. As of the date of this Amendment, the Study Period described in the
Agreement has expired. Purchaser acknowledges that Purchaser's right to
terminate the Agreement under Paragraph 6(c) has expired, and that within
twenty-four (24) hours of the execution of this Amendment, Purchaser shall
deposit with the Escrow Agent the additional deposit of $100,000.00 described in
the third sentence of Paragraph 3(b) of the Agreement.
9. Notwithstanding any contrary provision of Paragraph 16 of the
Agreement, Purchaser shall be responsible for all fees and other charges of KPMG
Peat Marwick relating to the preparation of audited financial statements
pertaining to the Hillcrest Inn property prepared at the request of Purchaser,
and Purchaser and Seller shall evenly share the fees and other charges of KPMG
Peat Marwick relating to the preparation of the audited financial statements
pertaining to the Sterling Canyon Inn property prepared at the request of
Purchaser; provided, however, that if the Agreement shall be terminated other
than due to a default by Seller, Purchaser shall pay all of such accounting fees
and charges pertaining to the Sterling Canyon Inn property. Purchaser
acknowledges receipt from Seller of an invoice for seventy-five percent (75%) of
the fees charged by KPMG Peat Marwick, and agrees to pay such amount within
seven (7) days of this Amendment.
10. Notwithstanding any contrary provision of Paragraph 17 of the
Agreement, Seller shall have the right and obligation to pay to Xxxxxxxx
Property Services any commission which Seller or its affiliates may have agreed
to
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pay to Xxxxxxxx Property Services in connection with the Agreement. In no event
shall Purchaser have any obligation to Xxxxxxxx Property Services for any
commission claimed due and owing as a result of this transaction.
11. The parties acknowledge that there was a typographical error in the
Agreement, and that the name of the Seller is Xxxxxxxx Senior Properties, Ltd.
The name of the Seller in the Agreement is hereby amended to be Xxxxxxxx Senior
Properties, Ltd.
12. All terms and conditions of the Agreement not specifically amended
hereby shall remain in full force and effect and the parties hereby confirm that
the Agreement has not been terminated (except with respect to the purchase and
sale of Hillcrest Inn) or otherwise modified, and that the Agreement remains in
full force and effect.
13. This Agreement may be executed in several counterparts, each of
which shall be fully effective as an original and all of which together shall
constitute one and the same instrument.
14. The parties agree that a facsimile transmission of an original
document shall have the same effect as an original, and any signature required
on an original shall be completed when a facsimile copy has been signed. The
parties further agree that signed facsimile copies of documents shall be
appended to the original thereof, integrated therewith and give full effect as
if an original.
IN WITNESS WHEREOF, the undersigned have caused their respective duly
authorized representatives to execute this Amendment under seal as of the day
and year first above written.
PURCHASER: SELLER:
Sunrise Development, Inc. Xxxxxxxx Senior Properties, Ltd.
By: Senior Properties, Inc., as its sole
General Partner
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxx, President Xxxxxxx X. Xxxxxxxxx,
Executive Vice President
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