FIRST AMENDMENT TO STOCK PURCHASER AGREEMENT
This Agreement is made and entered into
effective as of the 31st day of January, 1997, by
and between XXXXX XXXXXXX, XXXXXX XXXX, XXXXXX
XXXXXXX, XXXXXX XXXXXXXX, XXXXX XxXXXXXX, XXXXXX
XXXXXXX, AND XXXXX XXXXXXXX (collectively
"Seller") and EMERITUS CORPORATION, a Washington
corporation ("Purchaser") and EMERITUS PROPERTIES
V, INC., a Washington corporation ("Properties").
RECITALS
A. Seller and Purchaser are parties to that
Stock Purchase Agreement dated September 30,1996
(the "Purchase Agreement") with respect to the
acquisition by Purchaser of all of the issued and
outstanding stock of NPR Retirement Center, Inc.
(the "Corporation").
B. The Purchase Agreement provides for an
outside closing date of February 1,1997, subject
to certain automatic extension provisions in the
event Purchaser has not secured a license to
operate the Facility (as defined in the Purchase
Agreement) as of February 1, I 997.
C. The Purchase Agreement provides that it
is a condition to the Purchaser's obligation to
close that the stock acquisitions made pursuant to
the agreements described in Exhibit P thereto (the
"Other Purchase Agreements") shall have closed,
one of which relates to the assisted living
facility owned by Englewood Retirement Center,
Inc. and commonly referred to as Englewood
Retirement Center (the "Englewood Facility").
D. Seller and Purchaser have agreed that
the acquisition of the Englewood Facility cannot
occur by February 1,1997 due to outstanding
regulatory issues which must be addressed by
Englewood Retirement Center, Inc. (the "Englewood
Regulatory Issues").
E. Seller and Purchaser have agreed that it
is anticipated that it will take no longer than
sixty (60) days to resolve the Englewood
Regulatory Issues and have agreed to amend the
Purchase Agreement, as well as the Other Purchase
Agreements, to extend the Outside Closing Date
until May 1,1997.
F. In connection with the amendment of the
Purchase Agreement to address the extension of the
Closing Date, there are certain other matters
which Purchaser and Seller are interested in
addressing in an amendment to the Purchase
Agreement.
G. The Purchase Agreement provides that it
may be amended by written instrument signed by
Seller and Purchaser.
NOW, THEREFORE, in consideration of the
foregoing premises and the mutual covenants of the
parties set forth herein, IT IS HEREBY AGREED AS
FOLLOWS:
1. The Purchase Agreement is hereby amended
to reflect that by the execution of this
Agreement, Purchaser does hereby assign all of its
right, title and interest in and to and
obligations under the Purchase Agreement to
Properties and Properties does hereby assume all
of Purchaser's right, title and interest in and to
and
obligations under the Purchase Agreement and that
any and all references to the Purchaser in the
Purchase Agreement, the Other Purchase Agreements
and in any documents executed pursuant thereto
shall from an d after the date hereof be deemed to
be references to Properties; provided, however,
that nothing herein shall be construed as
releasing Emeritus from liability under the
Purchase Agreement.
2. Paragraph 1 is hereby amended to reflect
that immediately after the acquisition of the
Stock, Properties and the Corporation shall merge
and Properties shall be the surviving entity.
Seller and Purchaser acknowledge, agree and
reaffirm that the transaction provided for in the
Purchase Agreement is a stock, and not an asset,
transaction and that Purchaser shall not make an
election under Section 338 of the Internal Revenue
Code without the prior written consent of Seller.
3. Paragraph 2 is hereby amended to reflect
that Purchaser shall receive a credit against the
cash due at Closing pursuant to Paragraph 2(b) in
the amount of$31,280 as compensation for certain
physical plant improvements identified during
Purchaser's due diligence review and not corrected
as of the Closing Date by the Corporation.
4. Paragraph 3 is hereby amended to provide
that the Closing shall take place on May l,1997
provided all of the conditions to closing set
forth in Paragraphs 13 and 14 have been satisfied
or waived (the "Closing Date"). Purchaser shall
not have any rights to extend the Closing Date.
5. Paragraph 7(c) is hereby amended to read
in part as follows:
c. THE FACILITY. The facility is a
congregate care and assisted living and Alzheimer
care facility commonly known as La Casa Grande of
New Port Xxxxxx, located in New Port Xxxxxx,
Florida and duly licensed, with respect by the
State of Florida as an adult congregate care
living facility with a total of 242 licensed beds
and 200 licensed units (the "Facility").
6. Paragraph 7(m) is hereby amended by
adding the following at the end: "Seller is not
holding any security deposits on behalf of any of
the residents of the Facility. Seller is, however,
holding certain personal funds for certain
residents of the Facility, a detailed listing of
which will be provided to Purchaser at Closing and
which funds will be transferred to Purchaser at
Closing."
7. Section 10(a) is hereby amended to
include the following as an additional pre-closing
covenant of Seller:
xxv. If and when requested by Purchaser,
to issue to each resident of the facility a notice
advising them of an increase in the rates at the
Facility (the "Rate Increase"). In the event the
amount of the Rate Increase is more than 3% per
resident, the Rate Increase shall be subject to
the approval of Seller, which approval shall not
be unreasonably withheld. Seller and Purchaser
shall use their reasonable efforts to agree on a
Rate Increase schedule and to attach the same as
an exhibit hereto. The Rate Increase shall be
effective as on the date specified by Purchaser;
but in no event earlier than thirty (30) days
after the date of We Rate Increase notice and
shall commence on the first day of the month;
provided, however, in no event shall Seller be
required to
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issue the Rate Increase notice with an effective
date prior to the Closing Date, unless Purchaser
has confired in writing to Seller prior to the
issuance of the Rate Increase notice that it has
determined that the conditions to closing set
forth in Sections 13(s), (t), (u) and (v) have
been satisfied or that it has waived the same if
and to the extent not satisfied. Nothing herein
shall be construed as prohibiting Seller from
issuing the Rate Increase prior to the date
requested by Purchaser.
8. Paragraph 17(a)(v) is hereby deleted in
its entirety and the following inserted instead:
v. If the Closing has not occurred by May
1,1997 (the "Outside Closing Date") unless the
Closing has been extended by Seller pursuant to
the right granted to Seller under Section 11.3(t)
of that Stock Purchase Statement dated September
30,1996 as amended by First Amendment dated as of
January 3l, 1997 with respect to the Englewood
Retirement Center in Englewood, Florida (the
"Englewood Purchase Agreement"), in which case the
Outstanding Closing Date shall be June 1,1997.
9. Except as specifically set forth
xxxxxxx, the Purchase Agreement shall remain, in
full force and effect as originally executed.
IN WITNESS WHEREOF, the parties heereby
execute this Agreement as of the day and year
first set forth above.
SELLER: /s/ Xxxxx Xxxxxxx
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XXXXX XXXXXXX
/s/ Xxxxxx Xxxx
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XXXXXX XXXX
/s/ Xxxxxx Xxxxxxx
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XXXXXX XXXXXXX
/s/ Xxxxxx Xxxxxxxx
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XXXXXX XXXXXXXX
/s/ Xxxxx XxXxxxxx
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XXXXX XxXXXXXX
/s/ Xxxxxx Xxxxxxx
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XXXXXX XXXXXXX
/s/ Xxxxx Xxxxxxxx
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XXXXX XXXXXXXX
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PURCHASER: EMERITUS CORPORATION
By: /s/ Xxxxxxx X.
Xxxxxxxxxx
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Its: President
PURCHASER: EMERITUS PROPERTIES
V, INC.
By: /s/ Xxxxxxx X.
Xxxxxxxxxx
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Its: President
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