Exhibit 10.40
SIXTH AMENDMENT TO PURCHASE AND SALE AGREEMENT
THIS SIXTH AMENDMENT TO PURCHASE AND SALE AGREEMENT (this "Agreement"),
dated as of the 8th day of August, 1997, is made by and between GABLES AT
FARMINGTON ASSOCIATES, a Connecticut general partnership ("Seller"), with an
office in care of Allegis Realty Investors, LLC, 000 Xxxxxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxxxxxx 00000-0000 and BROOKDALE LIVING COMMUNITIES, INC., a Delaware
corporation ("Purchaser") with an office at 00 Xxxx Xxxxxx Xxxxx, Xxxxx 0000,
Xxxxxxx, XX 00000.
RECITALS:
Seller and Purchaser have entered into that certain Purchase and Sale
Agreement dated as of June 11, 1997 with respect to that certain improved real
property commonly known as The Gables at Farmington located at 00 Xxxxxxxxx
Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxx along with certain related personal and
intangible property, as amended by First Amendment to Purchase and Sale
Agreement dated as of July 3, 1997, as further amended by Second Amendment to
Purchase and Sale Agreement dated as of July 16, 1997, as further amended by
Third Amendment to Purchase and Sale Agreement dated as of July 23, 1997, as
further amended by Fourth Amendment to Purchase and Sale Agreement dated as of
July 30, 1997 and as further amended by Fifth Amendment to Purchase and Sale
Agreement dated as of August 5, 1997 (as amended, the "Purchase Agreement").
NOW, THEREFORE, in consideration of the foregoing, of the covenants,
promises and undertakings set forth herein, and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Seller and Purchaser agree to amend the Purchase Agreement as follows:
1. The Purchase Agreement is hereby amended to delete therefrom Section
2.2.1(b) in its entirety and to substitute therefor the following:
(b) On or before the third business day following the earlier to
occur of (i) issuance of a Certificate of Need with respect to the Property
in the name of Purchaser, its nominee or designee, and (ii) receipt by
Purchaser or the Connecticut Office of Health Care Access (with a copy
received by Purchaser) of a letter from the holder of the Certificate of
Need issued under DN 95-715, as modified under DN 97-709Ra, directing or
agreeing to a transfer of said Certificate of Need to Purchaser, its
nominee or designee, Purchaser shall make an additional deposit with the
Title Company of TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000) (the
"Additional Deposit") (the Initial Deposit and, to the extent such deposits
are made as of the applicable dates, the Additional Deposit, the First
Extension Deposit and the Second Extension Deposit (as defined in Section
10.4), collectively shall be referred to hereinafter as "Deposit").
-2-
2. Section 2.3 of the Purchase Agreement is hereby amended to delete the
date "August 17, 1997" therefrom and to substitute therefor the following:
"October 17, 1997".
3. The Purchase Agreement is hereby amended to delete therefrom Section
10.4(b) in its entirety and to substitute therefor the following: "(b)
Intentionally Deleted".
4. The Purchase Agreement is hereby amended to delete therefrom Section
10.4(c) and Section 10.4(d) in their entirety and to substitute therefor the
following:
(c) In the event Purchaser, despite diligent efforts, has failed to
obtain the Regulatory Licenses on or before October 5, 1997, then on
October 5, 1997, Purchaser shall notify Seller in writing (in either case,
a "First Notice") (i) that Purchaser has waived the Regulatory License
Condition and that subject only to the provisions of Section 9.10 hereof
and Seller's compliance with Seller's obligations to be satisfied at the
Closing. Purchaser will purchase the Property on October 17, 1997, or such
earlier date as may be mutually agreed upon by Seller and Purchaser,
without having obtained the Regulatory Licenses (in which case Purchaser
shall hire an assisted living services agency to provide assisted living
services to residential tenants of the Property following the Closing),
(ii) that Purchaser is extending the Date of Closing for one thirty (30)
day period (the "First Extension Period") solely for purposes of obtaining
the Regulatory Licenses, or (iii) that Purchaser is terminating this
Agreement; provided, however, in the event Purchaser elects to proceed
under Section 10.4 (c)(ii), Purchaser shall deposit with the Title Company
$100,000 (the "First Extension Deposit") on or before October 5, 1997. If
Purchaser has failed to obtain the Regulatory Licenses on or before the
October 5, 1997 and Purchaser fails to so send a First Notice, Purchaser
shall be deemed to have elected to proceed under subparagraph 10.4(c)(ii).
If Purchaser elects, or is deemed to have elected, to proceed under
subparagraph 10.4(c)(ii) and fails to deposit with the Title Company the
First Extension Deposit when required, then Seller may terminate this
Agreement.
(d) In the event that Purchaser properly exercises its option with
respect to the First Extension Period and pays the First Extension Deposit,
but fails, despite diligent efforts, to receive the Regulatory Licenses on
or before November 7, 1997, then on November 7, 1997, Purchaser shall
notify Seller in writing (in either case, a "Second Notice"): (i) that
Purchaser has waived the Regulatory License Condition and that subject only
to the provisions of Section 9.10 hereof and Seller's compliance with
Seller's obligations to be satisfied at the Closing, Purchaser will
purchase the Property on November 17, 1997 without having obtained the
Regulatory Licenses (in which case Purchaser shall hire an assisted living
services agency to provide assisted living services to residential tenants
of the Property following the Closing), (ii) that Purchaser is
-3-
extending the Date of Closing until December 17, 1997, solely for purposes
of obtaining the Regulatory Licenses, or (iii) that Purchaser is
terminating this Agreement; provided, however, in the event Purchaser
elects to proceed under clause (d)(ii), Purchaser shall deposit with the
Title Company $100,000 (the "Second Extension Deposit") on or before
November 7, 1997. If Purchaser has failed to obtain the Regulatory
Licenses on or before the November 7, 1997 and Purchaser fails to so send
a Second Notice, Purchaser shall be deemed to have elected to proceed under
subparagraph 10.4(d)(ii). If Purchaser elects, or is deemed to have
elected to proceed under subparagraph 10.4(d)(ii) and fails to deposit with
the Title Company the Second Extension Deposit when required, then Seller
may terminate this Agreement.
5. The Purchase Agreement is hereby amended to add thereto as a new
Section 10.5 the following:
10.5 Rights of Old Farms Forest. Purchaser acknowledges that Old Farms
Forest Associates, Limited Partnership ("Old Farms"), the general partner
of Aetna Life Insurance Company ("Aetna") in Seller, has thirty (30) days
after receipt of written notice of the terms of Purchaser's offer to
purchase the Property (the "Terms") to exercise certain rights under the
terms of Seller's partnership agreement. This Agreement and Seller's
obligations hereunder are contingent upon Old Farms approving (or being
deemed to have approved) the sale of the Property to Purchaser pursuant to
the Terms within said thirty (30) day period. In the event that the
contingency set forth in this Section 10.5 is not satisfied on or before
the expiration of such thirty (30) day period, then either party may
terminate this Agreement upon written notice delivered to the other party
within five (5) business days after the date on which Seller notifies
Purchaser that Old Farms is exercising its rights under Seller's
partnership agreement. If such termination notice is given, this Agreement
shall be deemed to have been terminated by Purchaser as of, and with
notice deemed to have been given to Seller by Purchaser on or before, the
Final Approval Date pursuant to Section 3.5.
Seller agrees to cause Aetna to promptly send notice of the Terms to
Old Farms. Promptly upon the expiration of said thirty (30) day period, or
promptly after such earlier date, if any, that Aetna receives written
notice of approval or exercise of Old Farm's rights pursuant to Seller's
partnership agreement, Seller shall inform Purchaser of such approval,
deemed approval or exercise.
6. The Purchase Agreement is hereby amended to add thereto as a new
Section 10.6 the following:
-4-
10.6 Letter of Map Amendment. The parties acknowledge that a portion
of the subject building lies within a special flood hazard area ("SHFA") as
approximately shown on the Updated Survey. Seller has agreed, at its
expense up to a maximum amount of $7,500, to cause X.X. Xxxxxxx &
Associates ("Xxxxxxx") to file an Application for Letter of Map Amendment
- Single Structure in connection with such matter. In the event that the
Federal Emergency Management Agency ("FEMA") determines that the subject
building cannot be removed from the SHFA (a "Negative Determination"), then
Purchaser shall be entitled to terminate this Agreement by giving notice of
termination to Seller within five (5) business days after Purchaser
receives notice of the Negative Determination ( "SHFA Termination Notice").
Promptly after the execution hereof, Purchaser shall instruct Xxxxxxx in
writing to inform both Purchaser's and Seller's counsel of any Negative
Determination by telephone and in writing after notice thereof (verbal or
otherwise) is received by Xxxxxxx. In the event that notice of a Negative
Determination is sent directly by FEMA to Seller, Seller shall promptly
provide a copy thereof to Purchaser.
If the SHFA Termination Notice is timely given, Seller shall direct
the Title Company promptly to return the Deposit to Purchaser and neither
party shall have any further liability hereunder except for Purchaser's
Indemnity Obligations set forth in Section 3.1.2 hereof.
7. The Purchase Agreement is hereby amended to add thereto as a new
Section 10.7 the following:
10.7 Security Deposits. In performing its due diligence with respect
to the Property, Purchaser has been unable to determine that Seller has in
its security deposit account cash in an amount equal to all security
deposits identified in the leases as having been deposited with Seller by
residential tenants, together with accrued unpaid interest thereon required
by Connecticut law. Purchaser and Seller shall use reasonable efforts to
resolve the discrepancies on or before August 22, 1997. If Purchaser and
Seller have not resolved such matter to their mutual satisfaction on or
before said date, Purchaser shall be entitled to terminate this Agreement
by giving written notice to Seller on or before said date. If such
notice is given, this Agreement shall be deemed to have been terminated by
Purchaser as of, and with notice deemed to have been given to Seller by
Purchaser on or before, the Final Approval Date pursuant to Section 3.5.
8. The Term Sheet included in the Purchase Agreement is hereby amended to
delete the date "August 17, 1997" which appears after the caption "Date of
Closing" and to substitute therefor the following: "October 17, 1997".
-5-
9. All references in the Purchase Agreement to "this Agreement" or "the
Agreement" shall mean the Purchase Agreement, as amended by this Agreement. All
initial capitalized terms not defined herein shall have the meanings ascribed to
them in the Purchase Agreement.
10. This Agreement shall be construed and enforced in accordance with the
laws of the State of Connecticut.
11. This Agreement shall be binding upon and inure to the benefit of
Purchaser and Seller and their successors and permitted assigns.
12. This Agreement may be executed and delivered in any number of
counterparts, each of which so executed and delivered shall be deemed to be an
original and all of which shall constitute one and the same instrument.
13. The Purchase Agreement, as amended hereby, remains in full force and
effect and is hereby ratified and confirmed.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
-6-
IN WITNESS WHEREOF, Purchaser and Seller have executed this Agreement on
the date set forth below, effective as of the date set forth above.
SELLER: GABLES AT FARMINGTON ASSOCIATES
By: Aetna Life Insurance Company, a general
partner
By: Day, Xxxxx & Xxxxxx
Its Attorneys
By: /s/ Xxxxxxxx X. Xxxxx
--------------------------
Printed name: Xxxxxxxx X. Xxxxx
Date: August 8, 1997
PURCHASER: BROOKDALE LIVING COMMUNITIES, INC.
By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
-------------------------------
Printed name: Xxxxxx X. Xxxxxxxx, Xx.
Its: Executive Vice President
Date: August 8, 1997
An original, fully executed copy of this Agreement, has been received by
the Title Company this ___ day of August, 1997, and by execution hereof the
Title Company hereby covenants and agrees to be bound by the terms of this
Agreement.
CHICAGO TITLE INSURANCE COMPANY
By:_________________________________
Printed name:_______________________
Its:________________________________
