<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENT
FILED PURSUANT TO 13d-1(a) AND AMENDMENTS
THERETO FILED PURSUANT TO 13d-2(a)
(Amendment No. __)*
Alternative Living Services, Inc.
---------------------------------
(Name of Issuer)
Common Stock, $0.01 par value per share
---------------------------------------
(Title of Class of Securities)
02145K-10-7
----------------------------
(CUSIP Number)
Alan C. Leet
Rogers & Hardin
2700 International Tower
229 Peachtree Street, N.E.
Atlanta, Georgia 30303 404/522-4700
-----------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 23, 1997
-------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box .
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
(Continued on following pages)
<PAGE> 2
13D
CUSIP No. 02145K-10-7 Page 2 of 9 Pages
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Timothy J. Buchanan
-----------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
(b)
- -----------------------------------------------------------------------
3 SEC USE ONLY
-----------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- -----------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) OR 2(e)
- -----------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
- -----------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER 553,045 See Item 5.
SHARES ---------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER 0 See Item 5.
OWNED BY ---------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER 553,045 See Item 5.
REPORTING ---------------------------------------------------
PERSON 10 SHARED DISPOSITIVE POWER 0 See Item 5.
WITH ---------------------------------------------------
- -----------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,059,045
-----------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
- -----------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.7%
- -----------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- -----------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!<PAGE>
<PAGE> 3
13D
CUSIP No. 02145K-10-7 Page 3 of 9 Pages
----------- ---------------------------
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Meredith G. Buchanan
- ------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
---------------------------------------------------------------------
(b)
---------------------------------------------------------------------
3 SEC USE ONLY
------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) OR 2(e)
- ------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER 506,000 See Item 5.
SHARES -----------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER 0 See Item 5.
OWNED BY -----------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER 506,000 See Item 5.
REPORTING -----------------------------------------------------
PERSON 10 SHARED DISPOSITIVE POWER 0 See Item 5.
WITH
- -------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,059,045
- -------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
- -------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.7%
- -------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- -------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 4
SCHEDULE 13D
ITEM 1. Security and Issuer.
The class of equity securities to which this Schedule 13D
relates is the common stock, par value $0.01 per share (the
"Common Stock"), of Alternative Living Services, Inc., a Delaware
corporation (the "Company"). The Company's principal executive
offices are located at 450 North Sunnyslope Road, Suite 300,
Brookfield, Wisconsin 53005.
ITEM 2. IDENTITY AND BACKGROUND.
(a) Name
1. Timothy J. Buchanan ("Mr. Buchanan")
2. Meredith G. Buchanan ("Mrs. Buchanan")
(b) Address
1. 816 Terradyne Circle
Andover, Kansas 67002
2. 816 Terradyne Circle
Andover, Kansas 67002
(c) Present Principal Occupation or Employment
1. Mr. Buchanan is the president of the Company.
2. Mrs. Buchanan is not currently employed.
(d) Neither of the Reporting Persons has during the last
five years been convicted in any criminal proceeding (excluding
traffic violations or similar misdemeanors).
(e) Neither of the Reporting Persons during the last five
years been a party to any civil proceeding of a judicial or
administrative body of competent jurisdiction as a result of such
proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or
finding any violation with respect to such laws.
(f) Citizenship:
1. Mr. Buchanan is a United States citizen.
2. Mrs. Buchanan is a United States citizen.
ITEM 3. Source and Amount of Funds or Other Consideration.
The Reporting Persons acquired the shares of Common Stock of
the Company reported in this Schedule 13D as a result of the
merger (the "Merger") of Tango Merger Corporation, a Kansas
corporation and a wholly owned subsidiary of the Company, with and into
Sterling House Corporation, a Kansas corporation
("Sterling"). As a result of the Merger, the 942,770 shares of
common stock of Sterling beneficially owned by the Reporting
Persons (the "Sterling Shares") were automatically converted into
the right to receive 1,037,047 shares of Common Stock of the
<PAGE> 5
Company. In addition, prior to the Merger, Mr. Buchanan held
options (the "Sterling Options") to purchase an aggregate of
20,000 shares of common stock of Sterling. Upon consummation of
the Merger, all of the Sterling Options became vested and
immediately exercisable for an aggregate of 21,998 shares of
Common Stock of the Company. The Merger was consummated on
October 23, 1997 (the "Effective Date").
ITEM 4. Purpose of Transaction.
The Reporting Persons acquired the shares of Common Stock of
the Company as an investment. The Reporting Persons may seek to acquire
additional shares of Common Stock of the Company through
open market or privately negotiated transactions from time to
time in their discretion. Any such purchases will depend upon
the market prices for the shares of Common Stock, the number of
shares which may become available for purchaser at prices which
the Reporting Persons regard as attractive and various other
factors which the Reporting Persons may determine to be relevant.
Alternatively, the Reporting Persons may in the future determine
to dispose of all or a portion of the shares of Common Stock
which they hold, depending upon, among other things, the then
market price for the Common Stock. Such sales may be made in
transactions in the open market or in privately negotiated
transactions.
Except as set forth in this Item 4, the Reporting Persons
have no present plans or proposals which relate to or would
result in any of the actions enumerated under Item 4 of Schedule
13D.
ITEM 5. Interest in Securities of the Issuer.
(a) Mr. Buchanan is the direct beneficial owner
(individually or as trustee of the Matthew Buchanan Trust, the
Emily Buchanan Trust and the Buchanan Family Trust) of 531,047
shares of Common Stock, or approximately 2.9% of the 18,548,217
shares of Common Stock outstanding after consummation of the
Merger (based on information provided to the Reporting Persons by
counsel for the Company). In addition, Mr. Buchanan is the
direct beneficial owner of options to purchase an aggregate of
21,998 shares of common stock of the Company all of which are
vested and immediately exercisable. Mrs. Buchanan is the direct
beneficial owner of 506,000 shares of Common Stock, or
approximately 2.7% of the 18,548,217 shares of Common Stock
outstanding after the consummation of the Merger (based on
information provided to the Reporting Persons by counsel for the
Company). Because of the familial relationship (Mr. and Mrs.
Buchanan are husband and wife), each Reporting Person listed in
Item 2(a) may be deemed to beneficially own the shares and options
beneficially owned directly by the other although neither
Reporting Person has the power to vote, direct the voting,
dispose or direct the disposition of the shares of Common Stock
or options held by or beneficially owned directly by the other
Reporting Person. Accordingly, as of the close of business on
October 23, 1997, each of the Reporting Persons may be deemed to
beneficially own 1,059,045 shares of Common Stock, or
approximately 5.7% of the 18,548,217 shares of Common Stock
outstanding after consummation of the Merger (based on
information provided to the Reporting Persons by counsel for the
<PAGE> 6
Company).
(b) Mr. Buchanan has the direct power to vote and direct
the disposition of the shares of Common Stock held by him, the
Matthew Buchanan Trust, the Emily Buchanan Trust and the Buchanan
Family Trust. Mrs. Buchanan has the direct power to vote and
direct the disposition of the shares of Common Stock held by her.
(c) Other than the receipt of the shares of Common Stock
identified in the foregoing paragraph (a), neither of the
Reporting Persons has engaged in transactions in the shares of
Common Stock during the past 60 days.
(d) No other person is known to have the right to receive
or the power to direct the receipt of dividends from, or the
proceeds from the sale of, any of the shares of Common stock
beneficially owned by the Reporting Persons.
(e) Not applicable.
ITEM 6. Contracts, Arrangements, Understandings or Relationships
with Respect to the Securities of the Issuer.
In connection with the Merger, Mr. Buchanan entered into an
Affiliate Agreement pursuant to which Mr. Buchanan undertook not
to make any sale of Common Stock received upon consummation of
the Merger in violation of the Securities Act of 1933, as amended
(the "Securities Act"), or the rules and regulations promulgated
thereunder. Generally, this will require that such sales be made
in accordance with Rule 145(d) under the Securities Act, which in
turn requires that, for specified periods, such sales be made in
compliance with the volume limitations, manner of sale provisions
and current information requirements of Rule 144 under the
Securities Act. In addition, the Affiliate Agreement requires
that Mr. Buchanan not sell, exchange, transfer, pledge, dispose
of or otherwise reduce his risk relative to shares of Common
Stock (except under certain limited circumstances) until such
time as financial results covering at least 30 days of combined
operations of the Company and Sterling after the Effective Date
(as defined above) of the Merger have been filed or published by
the Company.
<PAGE>
<PAGE> 7
ITEM 7. Materials to be Filed as Exhibits.
Exhibit 1 Affiliate Agreement dated July 30, 1997 and
executed by Mr. Buchanan.<PAGE>
<PAGE> 8
SIGNATURE
After reasonable inquiry and to the best of the knowledge
and belief of the undersigned, the undersigned certifies that the
information set forth in this statement is true, complete and
correct.
Date: October 23, 1997 \s\Timothy J. Buchanan
________________________________
Timothy J. Buchanan
<PAGE> 9
SIGNATURE
After reasonable inquiry and to the best of the knowledge
and belief of the undersigned, the undersigned certifies that the
information set forth in this statement is true, complete and
correct.
Date: October 23, 1997 \s\Meredith G. Buchanan
-----------------------
Meredith G. Buchanan
<PAGE> 1
STERLING HOUSE CORPORATION AFFILIATE AGREEMENT PRIVATE
Alternative Living Services, Inc.
450 Sunnyslope Road, Suite 300
Brookfield, Wisconsin 53005
Attention: Mr. William F. Lasky
Affiliate Agreement
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger, dated as of July
30, 1997 (the "Merger Agreement"; capitalized terms used and not otherwise
defined herein are used herein as defined in the Merger Agreement), among
Alternative Living Services, Inc., a Delaware corporation ("Tango"), Tango
Merger Corporation, a Kansas corporation and a wholly owned subsidiary of Tango
("Merger Sub"), and Sterling House Corporation, a Kansas corporation
("Twister").
Pursuant to the terms of the Merger Agreement, at the Effective Time,
Merger Sub will be merged with and into Twister (the "Merger") and the
outstanding shares of Twister Common Stock will be converted into and become
exchangeable for shares of Tango Common Stock on the basis set forth in the
Merger Agreement. As a result of the Merger, the undersigned may receive
shares of Tango Common Stock ("Parent Securities").
The undersigned has been advised that as of the date hereof he may be
deemed to be an "affiliate" of Twister, as the term "affiliate" is (i) defined
for purposes of paragraphs (c) and (d) of rule 145 ("Rule 145") of the rules
and regulations (the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), and/or (ii) used in and for purposes of Accounting Series
Releases 130 and 135, as amended, and Staff Accounting Bulletins 65 and 76, of
the Commission.
The undersigned hereby represents and warrants to and agrees with Tango
that:
1. The undersigned has full power and authority to execute and deliver
this letter and to make the representations and warranties set forth herein and
to perform his obligations hereunder;
2. The undersigned has carefully read this letter and the Merger
Agreement and discussed the requirements of such documents and other applicable
limitations upon his ability to sell, transfer or otherwise dispose of Parent
Securities with his counsel or counsel for Twister;
<PAGE> 2
3. The undersigned will not make any sale, transfer or other
disposition of Parent Securities in violation of the Securities Act or the
Rules and Regulations;
4. The undersigned has been advised that the issuance of Parent
Securities to the undersigned pursuant to the Merger is being registered
with the Commission under the Securities Act on a Registration Statement
on Form S-4. However, the undersigned has also been advised that, since
at the time the Merger will be submitted for a vote of the stockholders of
Twister the undersigned may be deemed to be an affiliate of Twister and the
distribution by the undersigned of the Parent Securities has not been
registered under the Securities Act, the undersigned may not sell, transfer
or otherwise dispose of Parent Securities issued to him in the Merger unless
(i) such sale, transfer or other disposition has been registered under the
Securities Act, (ii) such sale, transfer or other disposition is made in
conformity with the volume and other limitations of Rule
145 or (iii) in the opinion of counsel reasonably acceptable to Tango (it being
understood that the law firms of Rogers & Hardin LLP and Stroock & Stroock &
Lavan LLP are deemed to be reasonably satisfactory to Tango), such sale,
transfer or other disposition is otherwise exempt from registration under the
Securities Act;
5. The undersigned understands that, except as may be provided in the
Merger Agreement or Stockholder Voting Agreement, Tango is under no obligation
to register the sale, transfer or other disposition of Parent Securities by the
undersigned or on his behalf under the Securities Act or to take any other
action necessary in order to make compliance with an exemption from such
registration available;
6. The undersigned also understands that stop transfer instructions
will be given to Tango's transfer agents with respect to Parent Securities and
that there will be placed on the certificates for Tango Common Stock issued to
him, or any substitutions therefor, a legend stating in substance:
"THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, APPLIES. THE SHARES EVIDENCED BY THIS CERTIFICATE MAY ONLY BE
TRANSFERRED IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT DATED
___________, 1997 BETWEEN THE REGISTERED HOLDER HEREOF AND ALTERNATIVE
LIVING SERVICES, INC., A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES
OF ALTERNATIVE LIVING SERVICES, INC.";
7. The undersigned also understands that, unless the sale, transfer or
other disposition by him of Parent Securities issued to him has been registered
under the Securities Act or is a sale made in conformity with the provisions of
Rule 145, Tango reserves the right to put the following legend on the
certificates issued to any transferee of the undersigned:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH
RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
APPLIES, AND WERE NOT ACQUIRED BY THE HOLDER WITH A VIEW TO, OR FOR
<PAGE> 3
RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF WITHIN THE
MEANING OF THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES
EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR
OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH AN EXEMPTION.
8. The undersigned further represents to, and covenants with Tango
that, the undersigned has not, during the 30-day period immediately preceding
the Effective Time, engaged and will not engage, and after the Effective Time
until such time as results covering at least 30 days of combined operations of
Twister and Tango have been published by Tango, in the form of a quarterly
earnings report, an effective registration statement filed with the Commission,
a report to the Commission on Form 10-K, 10-Q, or 8-K, or any other public
filing or announcement which includes such combined results of operations, the
undersigned will not engage, in any sale, exchange, transfer, pledge,
disposition of or grant of any option, the establishment of any "short" or
put-equivalent position with respect to or the entry into of any similar
transaction intended to reduce the risk of the undersigned's ownership of,
or investment in, any of the following:
a. any Parent Securities, or any securities which may be paid as
a dividend or otherwise distributed thereon or with respect thereto or
issued or delivered in exchange or substitution therefor (all such shares
and other securities being referred to herein, collectively, as "Restricted
Securities"), or any option, right or other interest with respect to any
Restricted Securities;
b. any shares of Twister Common Stock or any options or warrants
to purchase shares of Twister Common Stock; or
c. any other shares of Tango Common Stock or any other equity
securities of Tango.
9. Except to the extent written notification to the contrary is
received by Tango from the undersigned prior to the Merger, the representations
contained herein will be true, complete and correct at all times from the date
hereof through the Closing Date.
Tango hereby agrees that as promptly as practicable after the Effective
Time, Tango will publish results covering at least 30 days of combined
operations of Twister and Tango in the form of a quarterly earnings report,
an effective registration statement filed with the Commission, a report to
the Commission on Form 10-K, 10-Q, 8-K, or any other public filing or
announcement which includes such combined results of operations; provided,
however, that Tango will be under no obligation to publish any such financial
information other than with respect to a fiscal quarter of Tango.
It is understood and agreed that the legends set forth in paragraphs 6 and
7 above shall be removed by delivery of substitute certificates with such
legend if the undersigned shall have delivered to Tango a copy of a letter
from the staff of the Commission, or an opinion of counsel in form and
substance reasonably satisfactory to Tango, to the effect that such legend is
not required for purposes of the Securities Act.
<PAGE> 4
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Execution of this agreement should not be considered an admission on the
part of the undersigned that he is an affiliate of Twister as described
above, or as a waiver of any rights the undersigned may have to object to any
claim that he is such an affiliate on or after the date of this agreement.
Very truly yours,
/s/ Timothy J. Buchanan
TIMOTHY J. BUCHANAN
Date:__July 30__, 1997
ACCEPTED AND AGREED
as of ___________ __, 1997:
ALTERNATIVE LIVING SERVICES, INC.
By: _________________________________
Name:
Title:
<PAGE> 5
STERLING HOUSE CORPORATION AFFILIATE AGREEMENT
Alternative Living Services, Inc.
450 Sunnyslope Road, Suite 300
Brookfield, Wisconsin 53005
Attention: Mr. William F. Lasky
Affiliate Agreement
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger, dated as of July 30,
1997 (the "Merger Agreement"; capitalized terms used and not otherwise defined
herein are used herein as defined in the Merger Agreement), among Alternative
Living Services, Inc., a Delaware corporation ("Tango"), Tango Merger
Corporation, a Kansas corporation and a wholly owned subsidiary of Tango
("Merger Sub"), and Sterling House Corporation, a Kansas corporation
("Twister").
Pursuant to the terms of the Merger Agreement, at the Effective Time,
Merger Sub will be merged with and into Twister (the "Merger") and the
outstanding shares of Twister Common Stock will be converted into and become
exchangeable for shares of Tango Common Stock on the basis set forth in the
Merger Agreement. As a result of the Merger, the undersigned may receive
shares of Tango Common Stock ("Parent Securities").
The undersigned has been advised that as of the date hereof it may be
deemed to be an "affiliate" of Twister, as the term "affiliate" is (i) defined
for purposes of paragraphs (c) and (d) of rule 145 ("Rule 145") of the rules
and regulations (the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), and/or (ii) used in and for purposes of Accounting Series
Releases 130 and 135, as amended, and Staff Accounting Bulletins 65 and 76, of
the Commission.
The undersigned hereby represents and warrants to and agrees with Tango
that:
1. The undersigned has full power and authority to execute and deliver
this letter and to make the representations and warranties set forth herein and
to perform its obligations hereunder;
2. The undersigned has carefully read this letter and the Merger
Agreement and discussed the requirements of such documents and other applicable
limitations upon its ability to sell, transfer or otherwise dispose of Parent
Securities with its counsel or counsel for Twister;
3. The undersigned will not make any sale, transfer or other
disposition of Parent Securities in violation of the Securities Act or the
Rules and Regulations;
<PAGE> 6
4. The undersigned has been advised that the issuance of Parent
Securities to the undersigned pursuant to the Merger is being registered with
the Commission under the Securities Act on a Registration Statement on Form
S-4. However, the undersigned has also been advised that, since at the time
the Merger will be submitted for a vote of the stockholders of Twister the
undersigned may be deemed to be an affiliate of Twister and the distribution
by the undersigned of the Parent Securities has not been registered under the
Securities Act, the undersigned may not sell, transfer or otherwise dispose
of Parent Securities issued to it in the Merger unless (i) such sale,
transfer or other disposition has been registered under the Securities Act,
(ii) such sale, transfer or other disposition is made in conformity with the
volume and other limitations of Rule 145 or (iii) in the opinion of counsel
reasonably acceptable to Tango (it being understood that the law firms of
Rogers & Hardin LLP and Stroock & Stroock & Lavan LLP are deemed to be
reasonably satisfactory to Tango), such sale, transfer or other disposition
is otherwise exempt from registration under the Securities Act;
5. The undersigned understands that, except as may be provided in the
Merger Agreement or Stockholder Voting Agreement, Tango is under no
obligation to register the sale, transfer or other disposition of Parent
Securities by the undersigned or on its behalf under the Securities Act or to
take any other action necessary in order to make compliance with an exemption
from such registration available;
6. The undersigned also understands that stop transfer instructions
will be given to Tango's transfer agents with respect to Parent Securities and
that there will be placed on the certificates for Tango Common Stock issued
to it or any substitutions therefor, a legend stating in substance:
"THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, APPLIES. THE SHARES EVIDENCED BY THIS CERTIFICATE MAY ONLY BE
TRANSFERRED IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT DATED
___________, 1997 BETWEEN THE REGISTERED HOLDER HEREOF AND ALTERNATIVE
LIVING SERVICES, INC., A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES
OF ALTERNATIVE LIVING SERVICES, INC.";
7. The undersigned also understands that, unless the sale, transfer or
other disposition by him of Parent Securities issued to it has been registered
under the Securities Act or is a sale made in conformity with the provisions of
Rule 145, Tango reserves the right to put the following legend on the
certificates issued to any transferee of the undersigned:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH
RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
APPLIES, AND WERE NOT ACQUIRED BY THE HOLDER WITH A VIEW TO, OR FOR
RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF WITHIN THE
MEANING OF THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES
EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR
OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH AN EXEMPTION.
<PAGE> 7
8. The undersigned further represents to, and covenants with Tango
that, the undersigned has not, during the 30-day period immediately preceding
the Effective Time, engaged and will not engage, and after the Effective Time
until such time as results covering at least 30 days of combined operations
of Twister and Tango have been published by Tango, in the form of a quarterly
earnings report, an effective registration statement filed with the
Commission, a report to the Commission on Form 10-K, 10-Q, or 8-K, or any
other public filing or announcement which includes such combined results of
operations, the undersigned will not engage, in any sale, exchange, transfer,
pledge, disposition of or grant of any option, the establishment of any
"short" or put-equivalent position with respect to or the entry into of any
similar transaction intended to reduce the risk of the undersigned's
ownership of, or investment in, any of the following:
a. any Parent Securities, or any securities which may be paid as
a dividend or otherwise distributed thereon or with respect thereto or
issued or delivered in exchange or substitution therefor (all such shares
and other securities being referred to herein, collectively, as "Restricted
Securities"), or any option, right or other interest with respect to any
Restricted Securities;
b. any shares of Twister Common Stock or any options or warrants
to purchase shares of Twister Common Stock; or
c. any other shares of Tango Common Stock or any other equity
securities of Tango.
9. Except to the extent written notification to the contrary is
received by Tango from the undersigned prior to the Merger, the representations
contained herein will be true, complete and correct at all times from the date
hereof through the Closing Date.
Tango hereby agrees that as promptly as practicable after the Effective
Time, Tango will publish results covering at least 30 days of combined
operations of Twister and Tango in the form of a quarterly earnings report,
an effective registration statement filed with the Commission, a report to
the Commission on Form 10-K, 10-Q, 8-K, or any other public filing or
announcement which includes such combined results of operations; provided,
however, that Tango will be under no obligation to publish any such financial
information other than with respect to a fiscal quarter of Tango.
It is understood and agreed that the legends set forth in paragraphs 6 and
7 above shall be removed by delivery of substitute certificates with such
legend if the undersigned shall have delivered to Tango a copy of a letter
from the staff of the Commission, or an opinion of counsel in form and
substance reasonably satisfactory to Tango, to the effect that such legend is
not required for purposes of the Securities Act.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 8
Execution of this agreement should not be considered an admission on the
part of the undersigned that it is an affiliate of Twister as described
above, or as a waiver of any rights the undersigned may have to object to
any claim that it is such an affiliate on or after the date of this agreement.
Very truly yours,
MATTHEW BUCHANAN TRUST
By: /s/ Timothy J. Buchanan
Name: Timothy J. Buchanan
Title: Trustee
Date:__July 30__, 1997
ACCEPTED AND AGREED
as of ___________ __, 1997:
ALTERNATIVE LIVING SERVICES, INC.
By: __________________________________
Name:
Title:
<PAGE> 9
STERLING HOUSE CORPORATION AFFILIATE AGREEMENT
Alternative Living Services, Inc.
450 Sunnyslope Road, Suite 300
Brookfield, Wisconsin 53005
Attention: Mr. William F. Lasky
Affiliate Agreement
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger, dated as of July 30,
1997 (the "Merger Agreement"; capitalized terms used and not otherwise defined
herein are used herein as defined in the Merger Agreement), among Alternative
Living Services, Inc., a Delaware corporation ("Tango"), Tango Merger
Corporation, a Kansas corporation and a wholly owned subsidiary of Tango
("Merger Sub"), and Sterling House Corporation, a Kansas corporation
("Twister").
Pursuant to the terms of the Merger Agreement, at the Effective Time,
Merger Sub will be merged with and into Twister (the "Merger") and the
outstanding shares of Twister Common Stock will be converted into and become
exchangeable for shares of Tango Common Stock on the basis set forth in the
Merger Agreement. As a result of the Merger, the undersigned may receive
shares of Tango Common Stock ("Parent Securities").
The undersigned has been advised that as of the date hereof it may be
deemed to be an "affiliate" of Twister, as the term "affiliate" is (i) defined
for purposes of paragraphs (c) and (d) of rule 145 ("Rule 145") of the rules
and regulations (the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), and/or (ii) used in and for purposes of Accounting Series
Releases 130 and 135, as amended, and Staff Accounting Bulletins 65 and 76, of
the Commission.
The undersigned hereby represents and warrants to and agrees with Tango
that:
1. The undersigned has full power and authority to execute and deliver
this letter and to make the representations and warranties set forth herein and
to perform its obligations hereunder;
2. The undersigned has carefully read this letter and the Merger
Agreement and discussed the requirements of such documents and other applicable
limitations upon its ability to sell, transfer or otherwise dispose of Parent
Securities with its counsel or counsel for Twister;
3. The undersigned will not make any sale, transfer or other
disposition of Parent Securities in violation of the Securities Act or the
Rules and Regulations;
<PAGE> 10
4. The undersigned has been advised that the issuance of Parent
Securities to the undersigned pursuant to the Merger is being registered with
the Commission under the Securities Act on a Registration Statement on Form
S-4. However, the undersigned has also been advised that, since at the time
the Merger will be submitted for a vote of the stockholders of Twister the
undersigned may be deemed to be an affiliate of Twister and the distribution
by the undersigned of the Parent Securities has not been registered under the
Securities Act, the undersigned may not sell, transfer or otherwise dispose
of Parent Securities issued to it in the Merger unless (i) such sale,
transfer or other disposition has been registered under the Securities Act,
(ii) such sale, transfer or other disposition is made in conformity with the
volume and other limitations of Rule 145 or (iii) in the opinion of counsel
reasonably acceptable to Tango (it being understood that the law firms of
Rogers & Hardin LLP and Stroock & Stroock & Lavan LLP are deemed to be
reasonably satisfactory to Tango), such sale, transfer or other disposition
is otherwise exempt from registration under the Securities Act;
5. The undersigned understands that, except as may be provided in the
Merger Agreement or Stockholder Voting Agreement, Tango is under no
obligation to register the sale, transfer or other disposition of Parent
Securities by the undersigned or on its behalf under the Securities Act or to
take any other action necessary in order to make compliance with an exemption
from such registration available;
6. The undersigned also understands that stop transfer instructions
will be given to Tango's transfer agents with respect to Parent Securities and
that there will be placed on the certificates for Tango Common Stock issued to
it, or any substitutions therefor, a legend stating in substance:
"THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, APPLIES. THE SHARES EVIDENCED BY THIS CERTIFICATE MAY ONLY BE
TRANSFERRED IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT DATED
___________, 1997 BETWEEN THE REGISTERED HOLDER HEREOF AND ALTERNATIVE
LIVING SERVICES, INC., A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES
OF ALTERNATIVE LIVING SERVICES, INC.";
7. The undersigned also understands that, unless the sale, transfer or
other disposition by it of Parent Securities issued to it has been registered
under the Securities Act or is a sale made in conformity with the provisions of
Rule 145, Tango reserves the right to put the following legend on the
certificates issued to any transferee of the undersigned:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH
RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
APPLIES, AND WERE NOT ACQUIRED BY THE HOLDER WITH A VIEW TO, OR FOR
RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF WITHIN THE
MEANING OF THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES
EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR
OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH AN EXEMPTION.
<PAGE> 11
8. The undersigned further represents to, and covenants with Tango
that, the undersigned has not, during the 30-day period immediately preceding
the Effective Time, engaged and will not engage, and after the Effective Time
until such time as results covering at least 30 days of combined operations
of Twister and Tango have been published by Tango, in the form of a quarterly
earnings report, an effective registration statement filed with the
Commission, a report to the Commission on Form 10-K, 10-Q, or 8-K, or any
other public filing or announcement which includes such combined results of
operations, the undersigned will not engage, in any sale, exchange, transfer,
pledge, disposition of or grant of any option, the establishment of any
"short" or put-equivalent position with respect to or the entry into of any
similar transaction intended to reduce the risk of the undersigned's
ownership of, or investment in, any of the following:
a. any Parent Securities, or any securities which may be paid as
a dividend or otherwise distributed thereon or with respect thereto or
issued or delivered in exchange or substitution therefor (all such shares
and other securities being referred to herein, collectively, as "Restricted
Securities"), or any option, right or other interest with respect to any
Restricted Securities;
b. any shares of Twister Common Stock or any options or warrants
to purchase shares of Twister Common Stock; or
c. any other shares of Tango Common Stock or any other equity
securities of Tango.
9. Except to the extent written notification to the contrary is
received by Tango from the undersigned prior to the Merger, the representations
contained herein will be true, complete and correct at all times from the date
hereof through the Closing Date.
Tango hereby agrees that as promptly as practicable after the Effective
Time, Tango will publish results covering at least 30 days of combined
operations of Twister and Tango in the form of a quarterly earnings report,
an effective registration statement filed with the Commission, a report to
the Commission on Form 10-K, 10-Q, 8-K, or any other public filing or
announcement which includes such combined results of operations; provided,
however, that Tango will be under no obligation to publish any such financial
information other than with respect to a fiscal quarter of Tango.
It is understood and agreed that the legends set forth in paragraphs 6 and
7 above shall be removed by delivery of substitute certificates with such
legend if the undersigned shall have delivered to Tango a copy of a letter
from the staff of the Commission, or an opinion of counsel in form and
substance reasonably satisfactory to Tango, to the effect that such legend is
not required for purposes of the Securities Act.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 12
Execution of this agreement should not be considered an admission on the
part of the undersigned that it is an affiliate of Twister as described
above, or as a waiver of any rights the undersigned may have to object to any
claim that it is such an affiliate on or after the date of this agreement.
Very truly yours,
EMILY BUCHANAN TRUST
By:__/s/ Timothy J. Buchanan
Name: Timothy J. Buchanan
Title: Trustee
Date:__July 30__, 1997
ACCEPTED AND AGREED
as of ___________ __, 1997:
ALTERNATIVE LIVING SERVICES, INC.
By: _________________________________
Name:
Title:
<PAGE> 13
STERLING HOUSE CORPORATION AFFILIATE AGREEMENT
Alternative Living Services, Inc.
450 Sunnyslope Road, Suite 300
Brookfield, Wisconsin 53005
Attention: Mr. William F. Lasky
Affiliate Agreement
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger, dated as of July 30,
1997 (the "Merger Agreement"; capitalized terms used and not otherwise defined
herein are used herein as defined in the Merger Agreement), among Alternative
Living Services, Inc., a Delaware corporation ("Tango"), Tango Merger
Corporation, a Kansas corporation and a wholly owned subsidiary of Tango
("Merger Sub"), and Sterling House Corporation, a Kansas corporation
("Twister").
Pursuant to the terms of the Merger Agreement, at the Effective Time,
Merger Sub will be merged with and into Twister (the "Merger") and the
outstanding shares of Twister Common Stock will be converted into and become
exchangeable for shares of Tango Common Stock on the basis set forth in the
Merger Agreement. As a result of the Merger, the undersigned may receive
shares of Tango Common Stock ("Parent Securities").
The undersigned has been advised that as of the date hereof it may be
deemed to be an "affiliate" of Twister, as the term "affiliate" is (i) defined
for purposes of paragraphs (c) and (d) of rule 145 ("Rule 145") of the rules
and regulations (the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), and/or (ii) used in and for purposes of Accounting Series
Releases 130 and 135, as amended, and Staff Accounting Bulletins 65 and 76, of
the Commission.
The undersigned hereby represents and warrants to and agrees with Tango
that:
1. The undersigned has full power and authority to execute and deliver
this letter and to make the representations and warranties set forth herein and
to perform its obligations hereunder;
2. The undersigned has carefully read this letter and the Merger
Agreement and discussed the requirements of such documents and other applicable
limitations upon its ability to sell, transfer or otherwise dispose of Parent
Securities with its counsel or counsel for Twister;
3. The undersigned will not make any sale, transfer or other
disposition of Parent Securities in violation of the Securities Act or the
Rules and Regulations;
<PAGE> 13
4. The undersigned has been advised that the issuance of Parent
Securities to the undersigned pursuant to the Merger is being registered with
the Commission under the Securities Act on a Registration Statement on Form
S-4. However, the undersigned has also been advised that, since at the time
the Merger will be submitted for a vote of the stockholders of Twister the
undersigned may be deemed to be an affiliate of Twister and the distribution
by the undersigned of the Parent Securities has not been registered under the
Securities Act, the undersigned may not sell, transfer or otherwise dispose
of Parent Securities issued to it in the Merger unless (i) such sale,
transfer or other disposition has been registered under the Securities Act,
(ii) such sale, transfer or other disposition is made in conformity with the
volume and other limitations of Rule 145 or (iii) in the opinion of counsel
reasonably acceptable to Tango (it being understood that the law firms of
Rogers & Hardin LLP and Stroock & Stroock & Lavan LLP are deemed to be
reasonably satisfactory to Tango), such sale, transfer or other disposition
is otherwise exempt from registration under the Securities
Act;
5. The undersigned understands that, except as may be provided in the
Merger Agreement or Stockholder Voting Agreement, Tango is under no
obligation to register the sale, transfer or other disposition of Parent
Securities by the undersigned or on its behalf under the Securities Act or to
take any other action necessary in order to make compliance with an exemption
from such registration available;
6. The undersigned also understands that stop transfer instructions
will be given to Tango's transfer agents with respect to Parent Securities and
that there will be placed on the certificates for Tango Common Stock issued to
it, or any substitutions therefor, a legend stating in substance:
"THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, APPLIES. THE SHARES EVIDENCED BY THIS CERTIFICATE MAY ONLY BE
TRANSFERRED IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT DATED
___________, 1997 BETWEEN THE REGISTERED HOLDER HEREOF AND ALTERNATIVE
LIVING SERVICES, INC., A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES
OF ALTERNATIVE LIVING SERVICES, INC.";
7. The undersigned also understands that, unless the sale, transfer or
other disposition by it of Parent Securities issued to it has been registered
under the Securities Act or is a sale made in conformity with the provisions of
Rule 145, Tango reserves the right to put the following legend on the
certificates issued to any transferee of the undersigned:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH
RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
APPLIES, AND WERE NOT ACQUIRED BY THE HOLDER WITH A VIEW TO, OR FOR
RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF WITHIN THE
MEANING OF THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES
EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR
OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH AN EXEMPTION.
<PAGE> 15
8. The undersigned further represents to, and covenants with Tango
that, the undersigned has not, during the 30-day period immediately preceding
the Effective Time, engaged and will not engage, and after the Effective Time
until such time as results covering at least 30 days of combined operations
of Twister and Tango have been published by Tango, in the form of a quarterly
earnings report, an effective registration statement filed with the
Commission, a report to the Commission on Form 10-K, 10-Q, or 8-K, or any
other public filing or announcement which includes such combined results of
operations, the undersigned will not engage, in any sale, exchange, transfer,
pledge, disposition of or grant of any option, the establishment of any
"short" or put-equivalent position with respect to or the entry into of any
similar transaction intended to reduce the risk of the undersigned's
ownership of, or investment in, any of the following:
a. any Parent Securities, or any securities which may be paid as
a dividend or otherwise distributed thereon or with respect thereto or
issued or delivered in exchange or substitution therefor (all such shares
and other securities being referred to herein, collectively, as "Restricted
Securities"), or any option, right or other interest with respect to any
Restricted Securities;
b. any shares of Twister Common Stock or any options or warrants
to purchase shares of Twister Common Stock; or
c. any other shares of Tango Common Stock or any other equity
securities of Tango.
9. Except to the extent written notification to the contrary is
received by Tango from the undersigned prior to the Merger, the representations
contained herein will be true, complete and correct at all times from the date
hereof through the Closing Date.
Tango hereby agrees that as promptly as practicable after the Effective
Time, Tango will publish results covering at least 30 days of combined
operations of Twister and Tango in the form of a quarterly earnings report,
an effective registration statement filed with the Commission, a report to
the Commission on Form 10-K, 10-Q, 8-K, or any other public filing or
announcement which includes such combined results of operations; provided,
however, that Tango will be under no obligation to publish any such financial
information other than with respect to a fiscal quarter of Tango.
It is understood and agreed that the legends set forth in paragraphs 6 and
7 above shall be removed by delivery of substitute certificates with such
legend if the undersigned shall have delivered to Tango a copy of a letter
from the staff of the Commission, or an opinion of counsel in form and
substance reasonably satisfactory to Tango, to the effect that such legend is
not required for purposes of the Securities Act.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 16
Execution of this agreement should not be considered an admission on the
part of the undersigned that it is an affiliate of Twister as described
above, or as a waiver of any rights the undersigned may have to object to
any claim that it is such an affiliate on or after the date of this agreement.
Very truly yours,
BUCHANAN FAMILY FOUNDATION
By: /s/ Timothy J. Buchanan
Name: Timothy J. Buchanan
Title: Trustee
Date:__July 30__, 1997
ACCEPTED AND AGREED
as of ___________ __, 1997:
ALTERNATIVE LIVING SERVICES, INC.
By:________________________________
Name:
Title:
<PAGE> 17
STERLING HOUSE CORPORATION AFFILIATE AGREEMENT
Alternative Living Services, Inc.
450 Sunnyslope Road, Suite 300
Brookfield, Wisconsin 53005
Attention: Mr. William F. Lasky
Affiliate Agreement
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger, dated as of July 30,
1997 (the "Merger Agreement"; capitalized terms used and not otherwise defined
herein are used herein as defined in the Merger Agreement), among Alternative
Living Services, Inc., a Delaware corporation ("Tango"), Tango Merger
Corporation, a Kansas corporation and a wholly owned subsidiary of Tango
("Merger Sub"), and Sterling House Corporation, a Kansas corporation
("Twister").
Pursuant to the terms of the Merger Agreement, at the Effective Time,
Merger Sub will be merged with and into Twister (the "Merger") and the
outstanding shares of Twister Common Stock will be converted into and become
exchangeable for shares of Tango Common Stock on the basis set forth in the
Merger Agreement. As a result of the Merger, the undersigned may receive
shares of Tango Common Stock ("Parent Securities").
The undersigned has been advised that as of the date hereof she may be
deemed to be an "affiliate" of Twister, as the term "affiliate" is (i) defined
for purposes of paragraphs (c) and (d) of rule 145 ("Rule 145") of the rules
and regulations (the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act"), and/or (ii) used in and for purposes of Accounting Series
Releases 130 and 135, as amended, and Staff Accounting Bulletins 65 and 76, of
the Commission.
The undersigned hereby represents and warrants to and agrees with Tango
that:
1. The undersigned has full power and authority to execute and deliver
this letter and to make the representations and warranties set forth herein and
to perform her obligations hereunder;
2. The undersigned has carefully read this letter and the Merger
Agreement and discussed the requirements of such documents and other applicable
limitations upon her ability to sell, transfer or otherwise dispose of Parent
Securities with her counsel or counsel for Twister;
3. The undersigned will not make any sale, transfer or other
disposition of Parent Securities in violation of the Securities Act or the
Rules and Regulations;
<PAGE> 18
4. The undersigned has been advised that the issuance of Parent
Securities to the undersigned pursuant to the Merger is being registered with
the Commission under the Securities Act on a Registration Statement on Form
S-4.
However, the undersigned has also been advised that, since at the time the
Merger will be submitted for a vote of the stockholders of Twister the
undersigned may be deemed to be an affiliate of Twister and the distribution
by the undersigned of the Parent Securities has not been registered under the
Securities Act, the undersigned may not sell, transfer or otherwise dispose
of Parent Securities issued to her in the Merger unless (i) such sale,
transfer or other disposition has been registered under the Securities Act,
(ii) such sale, transfer or other disposition is made in conformity with the
volume and other limitations of Rule 145 or (iii) in the opinion of counsel
reasonably acceptable to Tango (it being understood that the law firms of
Rogers & Hardin LLP and Stroock & Stroock & Lavan LLP are deemed to be
reasonably satisfactory to Tango), such sale, transfer or other disposition
is otherwise exempt from registration under the Securities
Act;
5. The undersigned understands that, except as may be provided in the
Merger Agreement or Stockholder Voting Agreement, Tango is under no
obligation to register the sale, transfer or other disposition of Parent
Securities by the undersigned or on her behalf under the Securities Act or
to take any other action necessary in order to make compliance with an
exemption from such registration available;
6. The undersigned also understands that stop transfer instructions
will be given to Tango's transfer agents with respect to Parent Securities and
that there will be placed on the certificates for Tango Common Stock issued to
her, or any substitutions therefor, a legend stating in substance:
"THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, APPLIES. THE SHARES EVIDENCED BY THIS CERTIFICATE MAY ONLY BE
TRANSFERRED IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT DATED
___________, 1997 BETWEEN THE REGISTERED HOLDER HEREOF AND ALTERNATIVE
LIVING SERVICES, INC., A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES
OF ALTERNATIVE LIVING SERVICES, INC.";
7. The undersigned also understands that, unless the sale, transfer or
other disposition by her of Parent Securities issued to her has been registered
under the Securities Act or is a sale made in conformity with the provisions of
Rule 145, Tango reserves the right to put the following legend on the
certificates issued to any transferee of the undersigned:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH
RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
APPLIES, AND WERE NOT ACQUIRED BY THE HOLDER WITH A VIEW TO, OR FOR
RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF WITHIN THE
MEANING OF THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES
EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR
OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH AN EXEMPTION.
<PAGE> 19
8. The undersigned further represents to, and covenants with Tango
that, the undersigned has not, during the 30-day period immediately
preceding the Effective Time, engaged and will not engage, and after the
Effective Time until such time as results covering at least 30 days of
combined operations of Twister and Tango have been published by Tango, in the
form of a quarterly earnings report, an effective registration statement
filed with the Commission, a report to the Commission on Form 10-K, 10-Q, or
8-K, or any other public filing or announcement which includes such combined
results of operations, the undersigned will not engage, in any sale,
exchange, transfer, pledge, disposition of or grant of any option, the
establishment of any "short" or put-equivalent position with
respect to or the entry into of any similar transaction intended to reduce the
risk of the undersigned's ownership of, or investment in, any of the
following:
a. any Parent Securities, or any securities which may be paid as
a dividend or otherwise distributed thereon or with respect thereto or
issued or delivered in exchange or substitution therefor (all such shares
and other securities being referred to herein, collectively, as "Restricted
Securities"), or any option, right or other interest with respect to any
Restricted Securities;
b. any shares of Twister Common Stock or any options or warrants
to purchase shares of Twister Common Stock; or
c. any other shares of Tango Common Stock or any other equity
securities of Tango.
9. Except to the extent written notification to the contrary is
received by Tango from the undersigned prior to the Merger, the representations
contained herein will be true, complete and correct at all times from the date
hereof through the Closing Date.
Tango hereby agrees that as promptly as practicable after the Effective
Time, Tango will publish results covering at least 30 days of combined
operations of Twister and Tango in the form of a quarterly earnings report,
an effective registration statement filed with the Commission, a report to
the Commission on Form 10-K, 10-Q, 8-K, or any other public filing or
announcement which includes such combined results of operations; provided,
however, that Tango will be under
no obligation to publish any such financial information other than with respect
to a fiscal quarter of Tango.
It is understood and agreed that the legends set forth in paragraphs 6 and
7 above shall be removed by delivery of substitute certificates with such
legend if the undersigned shall have delivered to Tango a copy of a letter
from the staff of the Commission, or an opinion of counsel in form and
substance reasonably satisfactory to Tango, to the effect that such legend is
not required for purposes of the Securities Act.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 20
Execution of this agreement should not be considered an admission on the
part of the undersigned that she is an affiliate of Twister as described above,
or as a waiver of any rights the undersigned may have to object to any claim
that she is such an affiliate on or after the date of this agreement.
Very truly yours,
/s/ Meredith Gail Buchanan
MEREDITH GAIL BUCHANAN
Date:__July30, ___________, 1997
ACCEPTED AND AGREED
as of ___________ __, 1997:
ALTERNATIVE LIVING SERVICES, INC.
By:
Name:
Title:
