SEVENTH AMENDMENT TO PURCHASE AGREEMENT
THIS SEVENTH AMENDMENT TO PURCHASE AGREEMENT (the "Amendment") is made
as of the 30 day of March 1999 by and between HEIGHTS HEALTHCARE COMPANY, L.L.C.
("HHCC"), CAX Lakeshore, L.L.C. ("CAX"), Lakeshore Utilities, L.L.C. ("Utility
LLC") and Senior Care Group, Inc. ("SCG") (collectively, the "Purchaser"), and
(i) LAKE SHORE VILLAS, INC., a Florida corporation, (ii) THE INN AT LAKESHORE
VILLAS, LTD., a Florida limited partnership, and (iii) LAKESHORE VILLA HEALTH
CARE, LTD., a Florida limited partnership, (collectively, the "Sellers").
W I T N E S S E T H :
WHEREAS, HHCC and Sellers entered into a Purchase Agreement dated
effective April 20, 1998 relating to the purchase and sale of a 290-lot mobile
home park, a 120-unit (156 bed) adult congregate living facility and a 179 bed
nursing home located in Hillsborough County, Tampa, Florida as amended by the
First Amendment to Purchase Agreement dated July 20, 1998, the Second Amendment
to Purchase Agreement dated August 5, 1998, the Third Amendment to Purchase
Agreement dated September 30, 1998, the Fourth Amendment to Purchase Agreement
dated November 12, 1998, the Fifth Amendment to Purchase Agreement dated
December 30, 1998 and the Sixth Amendment to Purchase Agreement dated January
31, 1999, as restated by the Restated Purchase Agreement entered into as of
January 29, 1999 (collectively, the "Purchase Agreement"); and
WHEREAS, Sellers and Purchaser desire to decrease the Purchase Price
(as such term is defined in Section 3.1 of the Purchase Agreement) in an amount
equal to the approximate amount for the repair and/or correction of (a) the
items described in the updated due diligence report as described in Section 4.2
on the Purchase Agreement (b) the initial capital expenditures identified in the
report prepared by EA Group, Inc. as described in Section 9.21(a) of the
Purchase Agreement and (c) the Repairs and Compliance as described in Section
9.21(b) of the Purchase Agreement; and
WHEREAS, Sellers and Purchaser desire to amend the allocation of the
Purchase Price; and
WHEREAS, Sellers and Purchaser desire to amend other provisions of the
Purchase Agreement.
NOW, THEREFORE, in consideration of the sum of Ten Dollars and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Purchaser and Sellers hereby agree as follows:
1. Purchase Price of Assets and Allocations. Section 3.1 of the
Purchase Agreement, entitled "Purchase Price of Assets and Allocation," shall be
deleted in its entirety and replaced with the following:
"Subject to the adjustments set forth herein, Purchaser, or
its assigns, shall pay to Sellers, as the total Purchase Price for all
of the Assets purchased, the sum of THIRTY-THREE MILLION NINE HUNDRED
AND FIFTY THOUSAND DOLLARS ($33,950,000) (the "Purchase Price"), to be
allocated in accordance with Exhibit 3.1 attached hereto and made part
hereof."
2. Cash at the Park Closing. Section 3.2(c) of the Purchase Agreement
entitled, "Cash at Closing," shall be deleted in its entirety and replaced with
the following:
"(c) Cash at the Park Closing. At the Park Closing, subject to
the adjustments herein provided for, CAX shall deliver to Sellers the
sum of SEVEN MILLION FIVE HUNDRED AND FIFTY THOUSAND DOLLARS
($7,550,000) by certified check or federal wire transfer, and Utility
LLC shall deliver to Sellers the sum of ONE HUNDRED AND FIFTY THOUSAND
DOLLARS ($150,000) by certified check or federal wire transfer. Credits
and debits on the closing statement, amounts delivered to HHCC pursuant
to Section 20 of the Sixth Amendment and additions to the Purchase
Price required hereunder, will adjust the cash at the closing."
3. Inspection Period. Notwithstanding anything to the contrary set
forth in Section 4.2 of the Purchase Agreement, CAX and Utility LLC hereby
acknowledge and agree that Sellers' and HHCC's or SCG's obligations to repair,
correct and/or incur all costs and expenses associated with the items revealed
in the updated due diligence report pursuant to Section 4.2(a) and Section
4.2(b) have been satisfied by the reduction in the Purchase Price and the
corresponding reduction in the amounts payable by CAX and Utility LLC at the
Park Closing.
4. Letter of Credit. Section 9.19(e) of the Purchase Agreement shall be
deleted in its entirety and replaced with the following:
"(e) As used in this Section 9.19, the term "Operating Costs"
shall mean the aggregate of all direct costs of operating and
maintaining the Sewer Plant, determined in accordance with generally
accepted accounting principles and all costs associated with repairing
equipment (including percolation ponds) associated with the operation
of the Sewer Plant and/or replacing equipment (including percolation
ponds) associated with the operation of the Sewer Plant which has been
certified by the independent operator of the Sewer Plant to be
inoperable and beyond economical repair, and "Sewer Plant" shall mean
the sewage treatment plant located on the Premises of the size and
configuration existing on the Closing Date."
5. Mobile Home Park. Notwithstanding anything to the contrary set forth
in Section 9.21(a) of the Purchase Agreement, CAX and Utility LLC hereby
acknowledge and agree that Sellers' and HHCC's or SCG's obligations pursuant to
Section 9.21(a)(i) and Section 9.21(a)(ii) to repair, correct and/or incur all
costs and expenses associated with ICEs (except for the storm and sanitary sewer
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repairs as described in Section 13 below) have been satisfied by the reduction
in the Purchase Price and the corresponding reduction in the amounts payable by
CAX and Utility LLC at the Park Closing.
6. Sewer Plant. Notwithstanding anything to the contrary set forth in
Section 9.21(b) of the Purchase Agreement, CAX and Utility LLC hereby
acknowledge and agree that Sellers' obligations pursuant to Section 9.21(b) to
complete the Repairs and Compliance have been satisfied by the reduction in the
Purchase Price, the corresponding reduction in the amounts payable by CAX and
Utility LLC at the Park Closing and the posting of the letter of credit in
accordance with Section 9.19(e) of the Purchase Agreement.
7. Indemnification by Purchaser. Section 12.01 of the Purchase
Agreement entitled, "By Purchaser," shall be amended by adding the following to
the end of such section:
"In addition, CAX and Utility LLC (collectively, the
"Indemnifying Party") hereby agree that the Indemnifying Party shall
defend and promptly indemnify Sellers and their successors and assigns
and save and hold them harmless from, against, for and in respect of,
and shall pay any and all damages, losses, obligations, liabilities,
claims, encumbrances, deficiencies, costs and expenses, including
without limitation, reasonable attorneys' fees and other costs and
expenses, which arise in connection with (a) any violation by the
Indemnifying Party of the Lake Shore Villas MHP Consent Order 98-12244
DW by and between the Environmental Protection Commission of
Hillsborough County and Lake Shore Villas, Inc. (the "Consent Order")
and/or (b) any failure of the Indemnifying Party to comply with terms
and conditions contained in the Consent Order.
8. Letter of Credit for Payment of Claims. The second sentence in
Section 12.6 of the Purchase Agreement entitled, "Payment of Claims," shall be
deleted in its entirety and replaced with the following:
At the Park Closing, Sellers shall establish an escrow account
for a period of two (2) years in the initial amount of $117,000 (which
may be reduced to $58,500 after the first anniversary of the Park
Closing Date), or in the alternative, post a letter of credit in the
amount of the escrow with an escrow agreement setting forth the
procedures for releasing the funds on a final judgment by a final
arbitration. At the ACLF/NH Closing, Sellers shall establish an escrow
account for a period of two (2) years in the initial amount of $383,000
(which may be reduced to $191,500 after the first anniversary of the
Park Closing Date), or in the alternative, post a letter of credit in
the amount of the escrow with an escrow agent setting forth the
procedures for releasing the funds on a final judgment by a final
arbitration."
9. Exhibits. Section 14.11 of the Purchase Agreement, entitled
"Exhibits," shall be deleted in its entirety and replaced with the following:
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(a) Exhibit 1.1(a): Description of the Premises
(b) Exhibit 1.1(c): Description of the Personalty
(c) Exhibit 1.1(d): List of Assumed Contracts
(d) Exhibit 1.2: Excluded Assets
(e) Exhibit 3.1: Allocation of Purchase Price
(f) Exhibit 4.1: Permitted Exceptions
(g) Exhibit 5.15: Pending Investigations
(h) Exhibit 5.21: List of Medicare/Medicaid Waivers
(i) Exhibit 5.26: Medicare/Medicaid
(j) Exhibit 9.20(a) Ground Lease Property
(k) Exhibit 9.20(b) Sewer Treatment Agreement
(l) Exhibit 9.21(a): List of Initial Capital Expenditures
(m) Exhibit 9.21(b) H2O Report
(n) Exhibit 12.6(a) L/C Procedures Agreement
(o) Exhibit 12.6(b) Escrow Agreement
(p) Exhibit 14.28: Chicago Title Insurance Company's General
Conditions of Escrow
10. Exhibit 3.1. Exhibit 3.1 of the Purchase Agreement entitled,
"Allocation of Purchase Price," shall be deleted in its entirety and shall be
replaced with Exhibit 3.1 attached hereto.
11. Exhibit 5.23. Exhibit 5.23 of the Purchase Agreement entitled,
"Pending Litigation," shall be deleted in its entirety and replaced with Exhibit
5.23 attached hereto.
12. Post-Park Closing Matters.
(a) Ad Valorem Tax Bills. Within sixty (60) days following the
Park Closing, CAX hereby agrees that CAX will request that Hillsborough County
provide separate ad valorem tax bills with respect to the Ground Lease Property
and agrees that CAX will proceed with reasonable diligence to insure that
Hillsborough County complies with this request for separate ad valorem tax bills
with respect to the Ground Lease Property.
(b) Termination of Easements. The parties acknowledge that on
the date of the ACLF/NH Closing that certain Drainage Easement recorded in O.R.
Book 3494, Page 491 Public Records of Hillsborough County, Florida and that
certain Easement recorded in O.R. Book 5693, Page 948, Public Records of
Hillsborough Count for ingress and egress shall be terminated.
(c) Repairs to Storm and Sanitary Sewer. The parties hereby
agree that after the Park Closing Sellers shall continue to have the
responsibility for completing the repairs to the storm and sanitary sewer lines
on or before April 7, 1999.
13. No Further Modifications. Except as modified herein, all of the
terms and conditions of the Purchase Agreement remain unchanged and in full
force and effect.
14. Miscellaneous. This Amendment is an integral part of the Purchase
Agreement. Unless otherwise defined herein, any capitalized term used in this
Amendment
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shall have the meaning given to such term in the Purchase Agreement. This
Amendment may be executed in any number of counterparts, each of which shall be
deemed an original, but all of which together shall be deemed to be one and the
same instrument. An executed facsimile copy of this Amendment shall be binding
for all parties. All references to section numbers contained in this Amendment
shall refer to the section numbers set forth in the Purchase Agreement dated
April 20, 1998 as amended by the First through Sixth Amendments.
[Remainder of page intentionally left blank]
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[Signature page to Seventh Amendment to Purchase Agreement]
IN WITNESS WHEREOF, the undersigned have executed this Seventh
Amendment to Purchase Agreement effective the day and year first above written.
PURCHASER:
HEIGHTS HEALTHCARE
COMPANY, L.L.C.
By /s/Xxxxx X. Xxxxxxx
-------------------------
Xxxxx X. Xxxxxxx
Managing Member
CAX LAKESHORE, L.L.C.
By Commercial Assets, Inc.,
Managing Member
By /s/Xxxxx X. Xxxxx
-------------------------
Xxxxx X. Xxxxx
President
LAKESHORE UTILITIES, L.L.C.
By Lakeshore Utilities, Inc.,
Managing Member
By /s/Xxxxx X. Xxxxx
--------------------------
Xxxxx X. Xxxxx
President
SENIOR CARE GROUP, INC.
By /s/Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
Chairman
[Signatures continued on next page]
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[Signature page to Seventh Amendment to Purchase Agreement]
SELLERS:
LAKE SHORE VILLAS, INC.
By /s/Xxxxxx X. Xxxxxxxx
-------------------------
Xxxxxx X. Xxxxxxxx
President
THE INN AT LAKESHORE VILLAS, LTD.
By Lakeshore Villas, Inc.,
its General Partner
By /s/Xxxxxx X. Xxxxxxxx
-------------------------
Xxxxxx X. Xxxxxxxx
President
LAKESHORE VILLA HEALTH CARE, LTD.
By Lakeshore Villas, Inc.,
its General Partner
By /s/Xxxxxx X. Xxxxxxxx
-------------------------
Xxxxxx X. Xxxxxxxx
President
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