<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
------------------------
FORM 10-K/A
(AMENDMENT NO. 2)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE FISCAL YEAR ENDED JUNE 30, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER 1-13845
BALANCED CARE CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 25-1761898
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
</TABLE>
1215 MANOR DRIVE
MECHANICSBURG, PENNSYLVANIA 17055
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES, INCLUDING ZIP CODE)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
<TABLE>
<CAPTION>
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED
------------------- -----------------------------------------
<S> <C>
COMMON STOCK $.001 PAR VALUE AMERICAN STOCK EXCHANGE
</TABLE>
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in the definitive proxy statement incorporated
by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [
]
The aggregate market value of the voting stock held by non-affiliates of
the registrant as of September 22, 1999 was approximately $18,241,458 based on
the last reported sales price of $1.25 as reported by the American Stock
Exchange. Shares of common stock known by the registrant to be beneficially
owned by executive officers or directors of the registrant are not included in
the computation; however, shares of common stock reported to be beneficially
owned by holders of 5% or more of the common stock are included in the
computation. The registrant has made no determination whether any of such
persons are "affiliates" within the meaning of Rule 12b-2 under the Securities
Exchange Act of 1934. The number of shares of common stock outstanding on
September 22, 1999 was 16,722,846 shares.
DOCUMENTS INCORPORATED BY REFERENCE: NONE
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<PAGE> 2
This Form 10-K/A (Amendment No. 2) amends the Company's Form 10-K/A
(Amendment No.1) previously filed on October 1, 1999 and the Company's Form 10-K
previously filed on September 28, 1999, to set forth the information required in
Part III of Form 10-K and to amend and restate the information in Part IV of
Form 10-K. The information in Part III was to be incorporated by reference to
the Company's definitive Proxy Statement to be filed pursuant to Regulation 14A.
However, the Company's definitive Proxy Statement will not be filed within the
120 day period after the end of the Company's fiscal year necessary to enable
the Company to incorporate such information by reference, as the Company has
postponed its annual meeting of stockholders.
PART III
ITEM 10--DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information regarding the executive officers of the Company is set
forth at the end of Item I of Part I of the Company's Form 10-K/A (Amendment
No.1) filed on October 1, 1999.
BOARD OF DIRECTORS
The Company's Certificate of Incorporation and Bylaws provide that the
number of directors shall be determined from time to time by the Board of
Directors (but shall be no less than three and no more than nine) and that the
Board shall be divided into three classes. The terms of office of the three
classes of directors (Class I, Class II and Class III) end in successive years.
The terms of the Class II directors expire this year and their successors are to
be elected at the 1999 annual meeting of stockholders for a three-year term
expiring in 2002. The terms of the Class III and Class I directors do not expire
until 2000 and 2001, respectively.
In December 1998, the Board of Directors appointed Pier C. Borra as Class
I director. In February 1999, John M. Brennan resigned as Class I director.
On October 8, 1999, the Board of Directors increased its size from seven
to nine members. In addition, in order to permit the appointment of four
directors designated by IPC Advisors S.A.R.L., which is now the Company's
largest stockholder, Bill R. Foster, Sr. and Raymond Schultz agreed to resign.
The Board of Directors appointed the following individuals to fill the
vacancies resulting from the foregoing:
Name Class
---- -----
Paul Reichmann Class I
Barry Reichmann Class I
Manfred J. Walt Class II
George Kuhl Class III
CLASS I DIRECTORS
PIER C. BORRA Mr. Borra is Chairman and Chief Executive Officer of CORA
Age 59 Health Services, Inc., a provider of outpatient
Director since rehabilitation, which he founded in December 1997.
1998 Previously, he served as Chairman, President and Chief
Executive Officer of Arbor Health Care Company, a sub-acute
care company, which he founded in 1985. Mr. Borra also
served as a Director of Health Care REIT (NYSE).
PAUL REICHMANN Since April 1999, Mr. Reichmann has served as the Executive
Age 69 Chairman of the Canary Wharf Group Plc, a real estate
Director since company listed on the London Stock Exchange. Since 1994, Mr.
October 1999 Reichmann has served as the Chief Executive of the
Reichmann Group of Companies. This group includes:
International Property Corporation and affiliates with
investments in office and commercial properties in the
United States; Reichmann International Development
Corporation and affiliates with investments in real estate
projects in Mexico City; and Central Park Lodges Ltd., a
private health care company that provides long term care
and assisted living services to seniors in both Canada and
the United States. Mr. Reichmann is the Chairman of Central
Park Lodges Ltd. and a Trustee of CPL Long Term Care Real
Estate Investment Trust, a real estate investment trust
listed on the Toronto Stock Exchange.
BARRY REICHMANN Since October 1994, Mr. Reichmann has served as President,
Age 33 Chief Executive Officer and a Director of Central Park
Director since Lodges Ltd., a private health care company that provides
October 1999 long term care and assisted living services to seniors in
both Canada and the United States. Mr. Reichmann is also the
Chief Executive Officer and a Trustee of CPL Long Term Care
Real Estate Investment Trust, a real estate investment trust
listed on the Toronto Stock Exchange. Mr. Reichmann is a
Director of Firm Capital Mortgage Investment Fund, a
mortgage investment fund listed on the Toronto Stock
Exchange.
63
<PAGE> 3
<TABLE>
<S> <C>
CLASS II DIRECTORS
EDWARD R. STOLMAN Mr. Stolman has owned and operated Stolman Investments since 1982,
Age 73 specializing in real estate and health care investments and consulting.
Director since 1997 He joined Hospital Affiliates International in 1968 and served as
Executive Vice President and Vice Chairman, and also served as Chairman
of Affiliated Health Corporation from 1984 to 1990. Mr. Stolman was an
original investor in and a member of the Board of Directors of Dovebar
International, Inc.
GEORGE H. STRONG Mr. Strong is a private investor with many years of experience in both
Age 73 director and executive positions in health care enterprises. Since 1994,
Director since 1996 Mr. Strong has served as a director for Integrated Health Services,
HealthSouth Rehabilitation Corporation, Managed Care USA and Amerisource.
Mr. Strong was a Senior Vice President and founding director of Universal
Health Services, Inc. from 1979 to 1985 and was with American Medicorp
for five years prior to that.
MANFRED J. WALT Since May 1998, Mr. Walt has served as Executive Vice President and Chief
Age 46 Financial Officer of Central Park Lodges Ltd., a private Canadian health
Director since October 1999 care company that provides long term care and assisted living services to
seniors in both Canada and the United States. From 1997 until May 1998,
Mr. Walt served as Senior Vice President of Gentra Inc. (an affiliate of
EdperBrascan Corporation), a real estate merchant bank listed on the
Toronto Stock Exchange. From 1980 until 1998, Mr. Walt served in various
capacities with the EdperBrascan group of companies including Managing
Partner of Financial Services for EdperBrascan Corporation, a diversified
conglomerate listed on the Toronto Stock Exchange. Mr. Walt is also a
member of the Boards of Directors of Central Park Lodges Ltd. and Oxford
Automotive Inc., a private company.
</TABLE>
<TABLE>
<S> <C>
CLASS III DIRECTORS
DAVID L. GOLDSMITH Since March 1999, Mr. Goldsmith has served as Managing Director for RS
Age 51 Investment Management, an independent money management firm. Prior to
Director since 1996 his service at RS Investment Management, Mr. Goldsmith was associated
with BancAmerica Robertson Stephens and its predecessors for more than
15 years, serving as a Managing Director, Health Care for more than
five years. Mr. Goldsmith is also a member of the Boards of Directors
of Apria Healthcare Group Inc. and selected private companies.
BRAD E. HOLLINGER Before joining the Company in 1995, Mr. Hollinger served as Executive
Age 45 Vice President of the Contract Services Group of Continental Medical
Chairman of the Board, Systems ("CMS"), a national provider of medical rehabilitation services
President and and contract therapy services from 1992 to 1995. Mr. Hollinger also
Chief Executive Officer served as Senior Vice President/Development of CMS from 1987 to 1990,
and a Director since 1995 leading the development and financing of eighteen medical rehabilitation
hospitals in seven states. From 1985 to 1987, Mr. Hollinger was Vice
President of Development of Rehab Hospital Service Corporation.
GEORGE KUHL Since October 1994, Mr. Kuhl has served as Vice Chairman/Chief Operating
Age 50 Officer of Central Park Lodges Ltd., a private Canadian health care
Director since October 1999 company that provides long term care and assisted living services to seniors
in both Canada and the United States. Mr. Kuhl is also a Trustee of CPL
Long Term Care Real Estate Investment Trust, a real estate investment
trust listed on the Toronto Stock Exchange.
</TABLE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the securities laws of the United States, the Company's directors,
its executive officers and any persons beneficially holding more than ten
percent of the Company's Common Stock are required to report their ownership of
the Company's Common Stock and any changes in that ownership to the Commission
and the AMEX. Specific due dates for these reports have been established and the
Company is required to report in this Form 10-K any failure to file by these
dates. All of these filing requirements were satisfied, except that Mr.
Goldsmith filed a Form 5 after the required due date to reflect the transfer of
shares that he had previously reported ownership of to a family trust. In making
these statements, the Company has relied on copies of the reports that its
officers, directors and beneficial owners of more than ten percent of the
Company's Common Stock have filed with the Commission.
64
<PAGE> 4
ITEM 11--EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth compensation information for the three
fiscal years ended June 30, 1999 for the Company's Chief Executive Officer and
for the four other most highly compensated executive officers of the Company for
Fiscal 1999, as well as one additional executive officer who resigned during
Fiscal 1999 (the "Named Executive Officers").
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------
ANNUAL COMPENSATION SECURITIES
FISCAL ------------------------ UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION(S) YEAR SALARY($) BONUS($)(1) OPTIONS(#S)(2) COMPENSATION($)
- ------------------------------ ---- --------- ----------- -------------- ---------------
<S> <C> <C> <C> <C> <C>
Brad E. Hollinger........................ 1999 225,000 150,000 100,000 --
Chairman of the Board, President 1998 200,000 116,250 -- --
and Chief Executive Officer 1997 152,500 58,000 75,000 --
Stephen G. Marcus........................ 1999 184,900 42,500 60,000 --
Chief Operating Officer 1998 83,802 -- 150,000 20,000(3)
1997 -- -- -- --
Brian L. Barth(4)........................ 1999 170,000 56,250 60,000 --
Chief Development Officer 1998 125,000 32,400 15,000 --
1997 75,000 20,000 26,250 --
Russell A. DiGilio....................... 1999 120,000 41,600 30,000 547(5)
Senior Vice President -- Outlook 1998 104,000 36,000 -- 2,132(5)
Pointe Division 1997 89,667 3,683 18,750 1,708(5)
David K. Barber.......................... 1999 110,000 33,400 15,000 --
Senior Vice President -- Project 1998 83,500 31,000 -- --
Management 1997 77,000 -- 13,125 --
Paul A. Kruis(6)......................... 1999 100,000 45,000 30,000 66,900(7)
Chief Financial Officer 1998 110,866 -- 150,000 --
1997 -- -- -- --
</TABLE>
- ---------------
(1) Reflects bonuses paid in Fiscal 1999, the year ended June 30, 1998 ("Fiscal
1998") and the year ended June 30, 1997 ("Fiscal 1997"), for services
rendered in Fiscal 1998, Fiscal 1997 and the year ended June 30, 1996,
respectively.
(2) Options granted pursuant to the Company's Incentive Plan to purchase shares
of Common Stock. Options granted during Fiscal 1999 are described in greater
detail below.
(3) Represents a sign-on bonus received by Mr. Marcus during Fiscal 1998.
(4) Mr. Barth resigned from the Company effective August 15, 1999.
(5) Represents the value received by Mr. DiGilio in connection with personal
usage of a Company-owned vehicle.
(6) Mr. Kruis resigned from the Company effective February 12, 1999.
(7) Represents amounts paid to Mr. Kruis for (i) accrued but unused vacation and
(ii) salary continuation from February 12, 1999 through and including June
30, 1999.
65
<PAGE> 5
OPTION GRANTS IN LAST FISCAL YEAR
The table below sets forth information with respect to stock options
granted to the Named Executive Officers in Fiscal 1999. No options were
exercised by the Named Executive Officers in Fiscal 1999. The options listed
below are included in the Summary Compensation Table above.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
NUMBER OF % OF TOTAL AT ASSUMED RATES OF
SECURITIES OPTIONS STOCK PRICE APPRECIATION
UNDERLYING GRANTED TO FOR OPTION TERM(7)
OPTIONS EMPLOYEES IN EXERCISE EXPIRATION --------------------------
NAME GRANTED(1) FISCAL YEAR PRICE($/SH) DATE 5% 10%
- ---- ---------- ----------- ----------- ---- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Brad E. Hollinger....... 50,000 3.2% 5.34 8/18/2008(2) $180,946 $446,279
50,000 3.2% 2.25 5/05/2009(3) $ 65,660 $171,191
Stephen G. Marcus....... 30,000 1.9% 5.34 8/18/2008(2) $108,568 $267,768
30,000 1.9% 2.25 5/05/2009(3) $ 39,396 $102,714
Brian L. Barth.......... 30,000 1.9% 5.34 8/18/2008(2)(4) $108,568 $267,768
30,000 1.9% 2.25 5/05/2009(3)(5) $ 39,396 $102,714
Russell A. DiGilio...... 15,000 1.0% 5.34 8/18/2008(2) $ 54,284 $133,884
15,000 1.0% 2.25 5/05/2009(3) $ 19,698 $ 51,357
David K. Barber......... 15,000 1.0% 5.34 8/18/2008(2) $ 54,284 $133,884
Paul A. Kruis........... 30,000 1.9% 5.34 8/18/2008(6) $108,568 $267,768
</TABLE>
- ---------------
(1) Options granted pursuant to the Incentive Plan to purchase shares of Common
Stock. Subject to the approval of the Compensation Committee, the exercise
price and applicable withholding taxes may be paid in cash or in shares of
the Company's Common Stock (whether previously owned or to be acquired upon
exercise), or by other methods which comply with the Incentive Plan and
applicable law.
(2) One quarter of the options granted vested on August 18, 1999 and the
remainder will vest in equal increments on August 18, 2000, 2001 and 2002
subject to the provisions of the Incentive Plan.
(3) The options granted will vest in equal increments on May 5, 2000, 2001, 2002
and 2003 subject to the provisions of the Incentive Plan.
(4) Of the options granted, only 25% vested on August 18, 1999 and will be
exercisable until August 15, 2000 pursuant to Mr. Barth's separation
agreement with the Company subject to the provisions of the Incentive Plan.
(5) The options granted are fully vested and exercisable pursuant to Mr. Barth's
separation agreement with the Company and are exercisable until November 15,
1999 subject to the provisions of the Incentive Plan.
(6) The options granted are fully vested and exercisable until July 15, 2000
pursuant to Mr. Kruis' separation agreement with the Company subject to the
provisions of the Incentive Plan.
(7) These assumed "potential realizable values" are mathematically derived from
certain prescribed rates of stock appreciation. The actual value of these
option grants is dependent on the future performance of Company Common Stock
and overall stock market conditions. There is no assurance that the values
reflected in this table will be achieved. These values are calculated using
the estimated fair market values of the Common Stock on August 18, 1998 and
May 5, 1999, of $5.50 and $2.1875 per share, respectively, and assume that
all such options are currently exercisable.
66
<PAGE> 6
COMPENSATION OF DIRECTORS
Members of the Board of Directors who are also employees of the Company do
not receive cash compensation for their services as directors. Members of the
Board of Directors who are not employees of the Company receive a $5,000 annual
retainer for their services as directors, payable quarterly. Each non-employee
director also receives $1,000 for each meeting attended and $500 for each
telephonic meeting in which he participated. In addition, under the Company's
1996 Stock Incentive Plan, as amended and restated, effective August 18, 1998
(the "Incentive Plan"), non-employee directors are granted non-qualified stock
options to purchase 15,000 shares of Common Stock upon each director's initial
election to the Board and 5,000 shares of Common Stock on the anniversary of
each director's election to the Board for the duration of his or her term.
During Fiscal 1999, Messrs. Schultz and Borra received non-qualified stock
options for 15,000 shares of Common Stock and Messrs. Brennan, Foster,
Goldsmith, and Stolman received non-qualified stock options for 5,000 shares of
Common Stock. All directors are reimbursed for reasonable expenses incurred in
attending board and committee meetings and otherwise carrying out their duties.
On August 9, 1999, the Compensation Committee of the Board voted to amend and
restate the Incentive Plan to provide that the non-qualified option to be
granted to each non-employee director to acquire 5,000 shares of Common Stock be
granted at each Annual Meeting of Stockholders of the Company rather than upon
the anniversary of each director's election to the Board (the "Amended Incentive
Plan"). The Amended Incentive Plan is subject to ratification by the Company's
Board of Directors. The Board is expected to ratify the Amended Incentive Plan
at its regular meeting scheduled for November 4, 1999. All share numbers reflect
the 3-for-4 reverse stock split of the Company's Common Stock in October 1997.
EMPLOYMENT AND RELATED ARRANGEMENTS
Employment Agreement with the Chief Executive Officer. The Company is
party to an employment agreement with Mr. Hollinger that became effective as of
August 1, 1996 and expires on July 31, 2001, subject to annual extensions
thereafter. Pursuant to the employment agreement, for Fiscal 1999 and
thereafter, Mr. Hollinger received, and is to receive, an annual salary of
$225,000. For each fiscal year of the Company throughout the term of the
agreement, Mr. Hollinger is also entitled to receive an annual bonus in an
amount not less than 75% of his base salary upon achievement by the Company of
certain levels of pre-tax earnings to be determined by the Board of Directors.
If the level of earnings exceeds the level determined by the Board for a fiscal
year, the Board may award Mr. Hollinger additional bonus compensation. Pursuant
to the employment agreement, the Company granted to Mr. Hollinger as of August
1, 1996 the right to purchase 37,500 shares of Common Stock at a purchase price
of $2.00 per share and, as of June 30, 1997, the right to purchase an additional
37,500 shares of Common Stock at a per share purchase price equal to the fair
market value of a share of Common Stock on June 30, 1997, which was $6.67 per
share. These options are generally to vest in accordance with the Incentive Plan
(including the Change of Control acceleration provision contained in such plan),
provided that if Mr. Hollinger terminates his employment for Good Reason (as
defined in the employment agreement, which includes the occurrence of a Change
in Control as Good Reason), the options are to become fully vested and
exercisable as of the date of such termination and may be exercised within one
year following such termination. In addition, if Mr. Hollinger terminates his
employment for Good Reason (including upon the occurrence of a Change in
Control), he will be entitled to receive a cash payment within 10 days of such
termination equal to three times his annual compensation plus the amount of any
bonus for that year.
Employment Agreements, Termination of Employment and Change in Control
Arrangements with Other Named Executive Officers. The Company is a party to an
employment agreement with Mr. Marcus dated November 24, 1997, that contemplates
a three year term expiring on January 4, 2001, subject to three year extensions
thereafter unless either party gives a 180 day notice of nonrenewal prior to the
expiration of the then current term. Pursuant to the employment agreement, Mr.
Marcus is entitled to receive an annual salary of $170,000 for the first year of
the agreement, which annual salary is to be increased in the second year to
$200,000 and thereafter adjusted annually in an amount equal to 10% per year.
For each fiscal year of the Company throughout the term of the agreement, Mr.
Marcus is also entitled to receive an annual bonus of up to 50% of his base
salary based upon his performance of stated objectives and the Company's
achievement of certain levels of pre-tax earnings to be determined by the Board
of Directors. Pursuant to the employment agreement, the Company granted Mr.
Marcus the right to purchase 150,000 shares of Common Stock at a purchase price
of $6.50, the fair market value of a share of Common Stock on January 5, 1998.
On each anniversary date of the employment agreement, the Company has agreed to
grant Mr. Marcus the right to purchase additional shares of Common Stock in an
amount of not less than 30,000 shares annually. These options are generally to
vest in accordance with the Incentive Plan (including the Change of Control
acceleration provision contained in such plan), provided that if the Company
terminates Mr. Marcus for reasons other than for cause, does not renew the
agreement or experiences a Change in Control (as defined in the employment
agreement), the options will become fully vested and exercisable in accordance
with the Incentive Plan. In addition, in the event of a change of control,
termination by the Company without cause within a specified period following the
change of control or nonrenewal of the agreement by the Company, Mr. Marcus will
be entitled to receive a cash payment within 15 days of such termination equal
to three times his annual compensation plus the amount of any bonus for that
year and to participate in the Company's health care benefits for one year
following such termination, or, at the Company's option, receive the cash value
of such benefits in a lump sum payable within 15 days of his termination.
67
<PAGE> 7
Mr. Barth resigned from the Company effective August 15, 1999. Mr. Barth
was a party to an employment agreement with the Company. The Company is a party
to a separation agreement with Mr. Barth dated August 23, 1999 that supersedes
his employment agreement and provides for him to receive certain severance
benefits. Mr. Barth received a lump sum payment of $75,000 (less applicable
withholdings and deductions) on September 26, 1999. Mr. Barth will also receive
severance pay at his final base salary of $170,000, paid semi-monthly in
accordance with the Company's normal payroll practices, commencing August 15,
1999 and continuing through August 14, 2000. Mr. Barth's stock options
representing an aggregate of 71,250 shares of Common Stock will continue to vest
in accordance with their scheduled terms and will be exercisable until August
15, 2000, subject to the provisions of the Incentive Plan. Mr. Barth's stock
options representing an aggregate of 30,000 shares of Common Stock vest
immediately and will be exercisable until November 15, 1999, subject to the
provisions of the Incentive Plan. The Company agreed to forgive the outstanding
principal balance of $7,000 that Mr. Barth owed to the Company under a
promissory note dated April 1, 1996 in the original principal amount of $20,000.
As consideration for Mr. Barth's severance benefits, commencing August 15, 1999
and continuing through August 15, 2000, Mr. Barth is prohibited from (i)
soliciting Company Customers (as defined in the separation agreement) or any
present employees of the Company and (ii) engaging in any Business Activity (as
defined in the separation agreement) in competition with the Company or its
Affiliates (as defined in the separation agreement). The separation agreement
also contains mutual release provisions that govern each party's respective
rights to bring future claims against the other party.
Mr. DiGilio is a party to a change in control agreement with the Company
dated September 23, 1998 that provides in the event of a Change in Control (as
defined in the agreement) of the Company that results in Mr. DiGilio's position
being diminished in scope of authority and responsibilities or a change in
reporting responsibility, or if he is terminated without cause, in each case
within a specified period following the Change in Control, Mr. DiGilio is
entitled to receive a cash payment within 30 days of the occurrence of such an
event in an amount equal to two times his annual compensation then in effect
plus the maximum amount of his potential annual bonus percentage payable for the
year in which the event occurred. In addition, all outstanding stock options
granted to Mr. DiGilio under the Incentive Plan will vest immediately and will
be exercisable subject to the provisions of the Incentive Plan.
Mr. Barber is a party to a change in control agreement with the Company
dated September 23, 1998 that provides in the event of a Change in Control (as
defined in the agreement) of the Company that results in Mr. Barber's position
being diminished in scope of authority and responsibilities or a change in
reporting responsibility, or if he is terminated without cause, in each case
within a specified period following the Change in Control, Mr. Barber is
entitled to receive a cash payment within 30 days of the occurrence of such an
event in an amount equal to two times his annual compensation then in effect
plus the maximum amount of his potential annual bonus percentage payable for the
year in which the event occurred. In addition, all outstanding stock options
granted to Mr. Barber under the Incentive Plan will vest immediately and will be
exercisable subject to the provisions of the Incentive Plan.
Mr. Kruis resigned from the Company effective February 12, 1999. The
Company was a party to an offer letter dated October 3, 1997 and a change in
control agreement dated November 5, 1998 with Mr. Kruis. The Company is a party
to a separation agreement with Mr. Kruis dated July 13, 1999 that supersedes his
prior agreements with the Company and provides for him to receive certain
severance benefits. Mr. Kruis is receiving severance pay at his final base
salary of $160,000, paid semi-monthly in accordance with the Company's normal
payroll practices, commencing February 12, 1999 and continuing through May 11,
2000. The separation agreement provides that Mr. Kruis' stock options,
representing an aggregate of 180,000 shares of Common Stock vest immediately and
will be exercisable until July 15, 2000 subject to the provisions of the
Incentive Plan. The separation agreement also contains mutual release provisions
that govern each party's respective rights to bring future claims against the
other party.
68
<PAGE> 8
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Prior to his resignation in February 1999, Mr. Brennan was a member of the
Compensation Committee. Mr. Brennan received a warrant in August 1996 to
purchase 138,000 shares of Common Stock of the Company at a purchase price of
$3.00 per share. The warrant has a ten year term and may be exercised at any
time.
69
<PAGE> 9
ITEM 12-- SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership of the Company's
Common Stock as of September 1, 1999 by each person or group known by the
Company to beneficially own more than five percent of outstanding Common Stock,
each director, nominee for director and the Named Executive Officers, and by all
directors and executive officers as a group. Unless otherwise indicated, the
holders of all shares shown in the table have sole voting and investment power
with respect to such shares. As of September 1, 1999, there were 16,722,846
outstanding shares of Common Stock.
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY PERCENT OF
NAME OWNED CLASS
---- ------------ ----------
<S> <C> <C>
IPC Advisors S.A.R.L........................................ 3,300,000(1) 16.48%
38-40 Rue Sainte Zithe
L-2763 Luxembourg
Astoria Capital Partners, L.P............................... 1,773,600 10.61%
6600 SW Ninety-Second Avenue
Suite 370
Portland, OR 97223
Meditrust................................................... 1,086,179(2) 6.50%
197 First Avenue
Needham Heights, MA 02194
Henry L. Hillman, Elsie Hilliard Hillman and C.G.
Grefenstette, Trustees.................................... 1,735,000(3) 10.38%
1900 Grant Building
Pittsburgh, PA 15129
John M. Brennan............................................. 1,237,051(4) 7.34%
Brennan Holdings
11212 Mann Road
Mooresville, IN 46158
Brad E. Hollinger........................................... 858,838(5) 5.00%
2850 Ford Farm Road
Mechanicsburg, PA 17055
Bill R. Foster, Sr.......................................... 792,412(6) 4.73%
Foster Health Care Group
426 South Jefferson
Springfield, MO 65801-2351
Paul Reichmann.............................................. 15,000(7) *
Barry Reichmann............................................. 15,000(8) *
Manfred J. Walt............................................. 15,000(9) *
George Kuhl................................................. 15,000(10) *
David L. Goldsmith.......................................... 55,663(11) *
Edward R. Stolman........................................... 19,250(12) *
George H. Strong............................................ 46,250(13) *
Pier C. Borra............................................... 55,000(14) *
Stephen G. Marcus........................................... 45,000(15) *
Brian L. Barth.............................................. 169,688(16) 1.01%
Russell A. DiGilio.......................................... 94,313(17) *
David K. Barber............................................. 81,867(18) *
Paul A. Kruis............................................... 192,923(19) 1.14%
All Directors and Executive Officers as a Group (15
persons)(20).............................................. 2,511,589(21) 14.68%
</TABLE>
- ---------------
* Indicates ownership of less than 1% of the Common Stock.
(1) Includes 3,300,000 of Series C Preferred Stock. Does not include 3,855,892
shares of Common Stock owned by certain stockholders of the Company over
which IPC has voting control only. IPC disclaims beneficial ownership of
the 3,855,892 shares of Common Stock.
(2) Includes 465,124 shares held subject to warrants owned by Meditrust
Mortgage Investments, Inc. and 289,743 shares held subject to warrants
owned by Meditrust Acquisition Corporation II, a wholly-owned subsidiary of
Meditrust.
(3) Consists of 1,000,000 shares held by trust for the benefit of Henry L.
Hillman (the "HLH Trust") and 525,000 shares owned by Juliet Challenger,
Inc., an indirect wholly-owned subsidiary of The Hillman Company ("THC").
The Trustees of the HLH Trust are Henry L. Hillman, Elsie Hilliard Hillman
and C.G. Grefenstette (the "HLH Trustees"). The HLH Trustees share voting
and investment power with respect to the shares held of record by the HLH
Trust and the assets of THC. Does not include an aggregate of 210,000
shares held by four trusts for the benefit of the members of the Hillman
family, as to which the HLH Trustees (other than Mr. Grefenstette, who is
one of the trustees of such family trusts) disclaim beneficial ownership.
(4) Includes 138,000 shares held subject to warrants.
(5) Includes 59,375 shares held subject to stock options. Also includes 1,150
shares held jointly by Brad E. Hollinger and his spouse, 5,250 shares
subject to Mr. DiGilio's right to purchase. Does not include 20,000 shares
held by Mr. Hollinger's spouse subject to stock options. Mr. Hollinger
disclaims beneficial ownership as to the 20,000 shares held by his spouse
subject to stock options.
(6) Includes 767,412 shares owned by the Inter Vivos Trust of Billy Ray Foster.
As the trustee, Mr. Foster has voting and investment power with respect to
the shares held by the trust and may be deemed to have indirect beneficial
ownership of them. Also includes 25,000 shares held subject to stock
options.
(7) Includes 15,000 shares held subject to stock options.
(8) Includes 15,000 shares held subject to stock options.
(9) Includes 15,000 shares held subject to stock options.
(10) Includes 15,000 shares held subject to stock options.
(11) Includes 34,413 shares owned by the Goldsmith Family Trust. As the
co-trustee, Mr. Goldsmith has voting and investment power with respect to
the shares held by the trust and may be deemed to have indirect beneficial
ownership of them. Also includes 21,250 shares held subject to stock
options.
(12) Includes 3,000 shares owned by The Stolman Family Trust. Also includes
16,250 shares held subject to stock options.
(13) Includes 8,750 shares held subject to stock options.
(14) Includes 45,000 shares held subject to stock options.
(15) Includes 45,000 shares held subject to stock options.
(16) Includes 3,750 shares held by The Brian L. Barth and Lori A. Barth
Irrevocable Children's Trust, for which Mr. Barth's sister-in-law is
trustee. Mr. Barth disclaims beneficial ownership as to such shares. Also
includes 60,938 shares held subject to stock options.
(17) Includes 5,250 shares subject to a right to purchase from Mr. Hollinger.
Also includes 89,063 shares held subject to stock options.
(18) Includes 10,313 shares held subject to stock options.
(19) Includes 6,000 shares held in managed accounts for Mr. Kruis' nephews. As
trustee, Mr. Kruis disclaims beneficial ownership as to such shares. Also
includes 180,000 shares held subject to stock options.
(20) Includes directors and officers as of October 12, 1999. Due to managerial
changes in connection with the Company's restructuring during Fiscal 1999,
as of August 9, 1999, Russell A. DiGilio, David K. Barber, Douglas L.
Brewer, and Mark S. Moore were no longer considered "executive officers" of
the Company. Gary W. Anderson was appointed Executive Vice
President--Operations of the Company on August 15, 1999.
(21) Includes 381,909 shares held subject to stock options.
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<PAGE> 10
ITEM 13--CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Brad Hollinger, President, Chief Executive Officer and Chairman of the
Board, was the sole member of Financial Care Investors, LLC, a Delaware limited
liability company ("FCI"). FCI owns six Operator/Lessees (collectively, the "FCI
Subsidiaries") that entered into management agreements, option agreements, and
other transaction documents with the Company, and facility lease agreements with
a Real Estate Investment Trust ("REIT") in September 1998. Effective September
30, 1999, FCI redeemed Mr. Hollinger's equity interests in FCI for nominal
consideration and FCI sold the equity interests to a group of third party
investors.
Bill R. Foster, Sr., a director of the Company, received $435,279 for
leasing to the Company two assisted living facilities in Springfield and Nevada,
Missouri and the Company's regional headquarters in Springfield, Missouri at an
annual rental of $194,454, $188,325 and $52,500, respectively.
Mr. Borra is a party to a consulting agreement with the Company to provide
investor relations, tactical planning and other consulting services. In
consideration, for each hour of service not to exceed 120 hours per year, Mr.
Borra is granted a non-qualified stock option for 250 shares of the Company's
Common Stock, subject to the terms and conditions pertaining to "Independent
Contractors" under the Company's Incentive Plan. During Fiscal 1999, Mr. Borra
was granted a non-qualified stock option for 30,000 shares of the Company's
Common Stock at an exercise price of $2.53 per share.
As of September 1, 1999, Meditrust was the beneficial owner of more than
five percent of the Common Stock. See "Security Ownership." The Company has
developed 23 assisted living facilities that are owned by Meditrust. Of these 23
facilities (19 in operation and 4 under construction), 18 are leased from
Meditrust by third party operators and managed by the Company pursuant to
management agreements, and 5 are leased directly from Meditrust by the Company.
In addition, the Company has seven facilities in operation leased by the Company
from Hawthorn Health Properties, Inc. that are mortgaged in favor of Meditrust
and one assisted living facility in operation that is leased by the Company from
Meditrust. Meditrust's investment in these facilities is approximately $144
million. Previously, the Company had two facilities in operation that were owned
by the Company and mortgaged in favor of Meditrust. In July 1999, the Company
satisfied its outstanding obligations under the two mortgages in favor of
Meditrust, for which Meditrust received $3,647,684.
Robin Barber, sister-in-law of Brad E. Hollinger, has been employed by the
Company as Director of Legal Services since 1996, Vice President and Senior
Counsel since September 1997, and Senior Vice President and Legal Counsel since
February, 1999. During Fiscal 1999, Ms. Barber received an annual salary of
$95,083 and a bonus of $20,000.
Scott J. Hollinger, brother of Brad E. Hollinger, has been employed by the
Company as a Construction Project Manager since December 1996 and
Director--Project Management since July 1998. During Fiscal 1999, Scott J.
Hollinger received an annual salary of $65,000 and a bonus of $15,750.
Deborah Myers Welsh, spouse of Brad E. Hollinger, entered into a consulting
agreement with the Company on February 3, 1997 to provide legal services at the
rate of $90 per hour not to exceed 30 hours per week for 50 weeks. Ms. Welsh
received $101,205 under such arrangement during Fiscal 1999.
See also "Compensation Committee Interlocks and Insider Participation."
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<PAGE> 11
PART IV
ITEM 14--EXHIBITS, FINANCIAL STATEMENT SCHEDULE AND REPORTS ON FORM 8-K
(a)(1) Financial Statements:
(a)(2) Financial Statement Schedule:
See (d) below.
(a)(3) Exhibits:
The following exhibits are filed herewith or are incorporated by
reference herein:
74
<PAGE> 12
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
2.1 Asset Purchase Agreement among BCC of Wisconsin, Inc., the
Company and Urquhart Company dated as of September 30, 1998
(incorporated by reference to Exhibit 2.1 to the Quarterly
Report on Form 10-Q for the quarter ended December 31, 1998
(No. 001-13845))
3.1 Amended and Restated Certificate of Incorporation of Balanced Care
Corporation (incorporated by reference to Exhibit 3.1 to the
Registration Statement on Form S-1 (No. 333-37833))
3.2 Bylaws of Balanced Care Corporation, as amended (incorporated by
reference to Exhibit 3.2 to the Registration Statement on Form S-1
(No. 333-37833))
4.1 Form of Capital Stock Purchase Warrant, together with schedule
(incorporated by reference to Exhibit 4.9 to the Registration
Statement on Form S-1 (No. 333-37833))
4.2 Form of Capital Stock Purchase Warrant, together with schedule
(incorporated by reference to Exhibit 4.10 to the Registration
Statement on Form S-1 (No. 333-37833))
4.3 Form of Capital Stock Purchase Warrant, together with schedule
(incorporated by reference to Exhibit 4.11 to the Registration
Statement on Form S-1 (No. 333-37833))
10.1 Form of Meditrust Facility Lease Agreement, together with schedule
(incorporated by reference to Exhibit 10.46 to the Registration
Statement on Form S-1 (No. 333-37833))
10.2 Form of Meditrust Facility Lease Agreement (incorporated by reference
to Exhibit 10.2 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.3 Schedule to Form of Meditrust Facility Lease Agreement (incorporated
by reference to Exhibit 10.3 to the Company's Annual Report on Form
10-K for the year ended June 30, 1998 (No. 001-13845))
10.4 Form of Meditrust Option Agreement (incorporated by reference to
Exhibit 10.6 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.5 Schedule to Form of Meditrust Option Agreement (incorporated by
reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
</TABLE>
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<PAGE> 13
10.6 Form of Meditrust Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.8 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.7 Schedule to Form of Meditrust Shortfall Funding Agreement (incorporated
by reference to Exhibit 10.9 to the Company's Annual Report on Form
10-K for the year ended June 30, 1998 (No. 001-13845))
10.8 Form of Meditrust Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.10 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.9 Schedule to Form of Meditrust Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.11 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.10 Form of Nationwide Health Properties, Inc. ("NHP") First Series Lease
and Security Agreement (incorporated by reference to Exhibit 10.12 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.11 Schedule to Form of NHP First Series Lease and Security Agreement
(incorporated by reference to Exhibit 10.13 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.12 Form of NHP Second Series Lease and Security Agreement (incorporated by
reference to Exhibit 10.14 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.13 Schedule to Form of NHP Second Series Lease and Security Agreement
(incorporated by reference to Exhibit 10.15 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.14 NHP First Series Master Investment Agreement (incorporated by reference
to Exhibit 10.18 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.15 NHP Second Series Master Investment Agreement (incorporated by
reference to Exhibit 10.19 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.16 Form of NHP First Series Option Agreement (incorporated by reference to
Exhibit 10.20 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
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<PAGE> 14
<TABLE>
- --------------------------------------------------------------------------------
<S> <C>
10.17 Schedule to Form of NHP First Series Option Agreement (incorporated by
reference to Exhibit 10.21 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.18 Form of NHP Second Series Option Agreement (incorporated by reference
to Exhibit 10.22 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.19 Schedule to Form of NHP Second Series Option Agreement (incorporated by
reference to Exhibit 10.23 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.20 Form of NHP First Series Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.24 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.21 Schedule to Form of NHP First Series Shortfall Funding Agreement
(incorporated by reference to Exhibit 10.25 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.22 Form of NHP Second Series Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.26 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.23 Schedule to Form of NHP Second Series Shortfall Funding Agreement
(incorporated by reference to Exhibit 10.27 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.24 Form of NHP First Series Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.28 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.25 Schedule to Form of NHP First Series Working Capital Assurance
Agreement (incorporated by reference to Exhibit 10.29 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
10.26 Form of NHP Second Series Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.30 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.27 Schedule to Form of NHP Second Series Working Capital Assurance
Agreement (incorporated by reference to Exhibit 10.31 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
- --------------------------------------------------------------------------------
</TABLE>
77
<PAGE> 15
10.28 Form of American Health Properties, Inc. ("AHP") Lease and Security
Agreement (incorporated by reference to Exhibit 10.32 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
10.29 Schedule to Form of AHP Lease and Security Agreement (incorporated by
reference to Exhibit 10.33 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.30 Form of AHP Option Agreement (incorporated by reference to Exhibit
10.36 to the Company's Annual Report on Form 10-K for the year ended
June 30, 1998 (No. 001-13845))
10.31 Schedule to Form of AHP Option Agreement (incorporated by reference to
Exhibit 10.37 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.32 AHP Option Agreement II (incorporated by reference to Exhibit 10.38 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.33 Form of AHP Shortfall Funding Agreement, together with schedule
(incorporated by reference to Exhibit 10.75 to the Registration
Statement on Form S-1 (No. 333-37833))
10.34 Schedule to Form of AHP Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.40 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.35 Form of AHP Working Capital Assurance Agreement, together with
schedule (incorporated by reference to Exhibit 10.80 to the
Registration Statement on Form S-1 (No. 333-37833))
10.36 Schedule to Form of AHP Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.42 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.37 Form of Ocwen Financial Corporation ("Ocwen") Lease Agreement
(incorporated by reference to Exhibit 10.43 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.38 Schedule to Form of Ocwen Lease Agreement (incorporated by reference
to Exhibit 10.44 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
78
<PAGE> 16
10.39 Form of Ocwen Option Agreement (incorporated by reference to Exhibit
10.47 to the Company's Annual Report on Form 10-K for the year ended
June 30, 1998 (No. 001-13845))
10.40 Schedule to Form of Ocwen Option Agreement (incorporated by reference
to Exhibit 10.48 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.41 Form of Ocwen Shortfall Funding Agreement (incorporated by reference
to Exhibit 10.49 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.42 Schedule to Form of Ocwen Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.50 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.43 Ocwen Shortfall Funding Agreement II (incorporated by reference to
Exhibit 10.51 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.44 Form of Ocwen Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.52 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.45 Schedule to Form of Ocwen Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.53 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.46 Ocwen Working Capital Assurance Agreement II (incorporated by
reference to Exhibit 10.54 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.47 First Amendment to Option Agreements, Shortfall Funding Agreements and
Stock Pledge Agreements (incorporated by reference to Exhibit 10.55 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.48 Form of Capstone Lease, together with schedule (incorporated by
reference to Exhibit 10.22 to the Registration Statement on Form S-1
(No. 333-37833))
10.49 Form of Capstone Lease (incorporated by reference to Exhibit 10.57 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.50 Schedule to Form of Capstone Lease (incorporated by reference to
Exhibit 10.58 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
79
<PAGE> 17
10.51 Form of Capstone Option Agreement (incorporated by reference to
Exhibit 10.60 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.52 Schedule to Form of Capstone Option Agreement (incorporated by
reference to Exhibit 10.61 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.53 Form of Capstone Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.62 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.54 Schedule to Form of Capstone Shortfall Funding Agreement (incorporated
by reference to Exhibit 10.63 to the Company's Annual Report on Form
10-K for the year ended June 30, 1998 (No. 001-13845))
10.55 Form of Capstone Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.64 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.56 Schedule to Form of Capstone Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.65 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.57 Form of Capstone Assignment, Assumption and Amendment Agreement
(incorporated by reference to Exhibit 10.66 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.58 Schedule to Form of Capstone Assignment, Assumption and Amendment
Agreement (incorporated by reference to Exhibit 10.67 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
10.59 Lease, dated as of March 21, 1996, by and between HCPI Trust and BCC
at Mt. Royal Pines, Inc. (incorporated by reference to Exhibit 10.34
to the Registration Statement on Form S-1 (No. 333-37833))
10.60 First Amendment, dated as of March 31, 1997, to Lease dated as of
March 21, 1996 by and between HCPI Trust and BCC at Mt. Royal Pines,
Inc. (incorporated by reference to Exhibit 10.35 to the Registration
Statement on Form S-1 (No. 333-37833))
10.61 Loan and Security Agreement among Balanced Care Corporation and
certain of its wholly-owned subsidiaries and HCFP Funding, Inc. dated
April 22, 1999 (previously filed)
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<PAGE> 18
10.62 Revolving Credit Note from Balanced Care Corporation and certain of
its wholly-owned subsidiaries in favor of HCFP Funding, Inc. dated
April 22, 1999 (previously filed)
10.63 Environmental Indemnity Agreement by Balanced Care Corporation and
certain of its wholly-owned subsidiaries in favor of HCFP Funding,
Inc. dated April 22, 1999 (previously filed)
10.64 Deed of Trust, Assignment of Rents and Leases and Security Agreement
from Balanced Care at North Ridge, Inc. in favor of HCFP Funding, Inc.
dated April 22, 1999 (previously filed)
10.65 Form of Open-Ended Mortgage, Assignment of Rents, Leases and Security
Agreement in favor of HCFP Funding, Inc. dated April 22, 1999
(previously filed)
10.66 Schedule to Form of Open-End Mortgage, Assignment of Rents, Leases and
Security Agreement in favor of HCFP Funding, Inc. dated April 22, 1999
(previously filed)
10.67 Accounts Receivable Intercreditor Agreement between HCFP Funding, Inc.
and Meditrust Mortgage Investments, Inc. dated April 22, 1999
(previously filed)
10.68 Amendment No. 1 to Loan and Security Agreement among Balanced Care
Corporation and certain of its wholly-owned subsidiaries and HCFP
Funding, Inc. dated July 1, 1999 (previously filed)
10.69 Amendment No. 2 to Loan and Security Agreement among Balanced Care
Corporation and certain of its wholly-owned subsidiaries and HCFP
Funding, Inc. dated July 29, 1999 (previously filed)
10.70 Form of HCRI Lease Agreement (incorporated by reference to Exhibit
10.1 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.71 Schedule to Form of HCRI Lease Agreement (incorporated by reference to
Exhibit 10.2 to the Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998 (No. 001-13845))
10.72 Form of HCRI Construction Disbursing Agreement (incorporated by
reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.73 Schedule to Form of HCRI Construction Disbursing Agreement
(incorporated by reference to Exhibit 10.4 to the Quarterly Report on
Form 10-Q for the quarter ended September 30, 1998 (No. 001-13845))
81
<PAGE> 19
<TABLE>
<S> <C>
10.74 Form of HCRI Option Agreement (incorporated by reference to Exhibit
10.5 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.75 Schedule to Form of HCRI Option Agreement (incorporated by reference to
Exhibit 10.6 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.76 Form of HCRI Shortfall Funding Agreement (incorporated by reference to
Exhibit 10.7 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.77 Schedule to Form of HCRI Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.8 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.78 Form of HCRI Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.9 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.79 Schedule to Form of HCRI Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.10 to the Quarterly Report on
Form 10-Q for the quarter ended September 30, 1998 (No. 001-13845))
10.80 Form of HCRI Management Agreement (incorporated by reference to Exhibit
10.11 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.81 Schedule to Form of HCRI Management Agreement (incorporated by
reference to Exhibit 10.12 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.82 Form of HCRI Guaranty (incorporated by reference to Exhibit 10.13 to
the Quarterly Report on Form 10-Q for the quarter ended September 30,
1998 (No. 001-13845))
10.83 Schedule to Form of HCRI Guaranty (incorporated by reference to Exhibit
10.14 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.84 Form of HCRI Loan Agreement (incorporated by reference to Exhibit 10.15
to the Quarterly Report on Form 10-Q for the quarter ended September
30, 1998 (No. 001-13845))
</TABLE>
82
<PAGE> 20
10.85 Schedule to Form of HCRI Loan Agreement (incorporated by reference to
Exhibit 10.16 to the Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998 (No. 001-13845))
10.86 Lease Agreement between Pennsylvania BCC Properties, Inc. and Balanced
Care at Saxonburg, Inc. (incorporated by reference to Exhibit 10.1 of
the Company's Current Report on Form 8-K dated March 18, 1999 No.
001-13845)
10.87 Lease Agreement between Pennsylvania BCC Properties, Inc. and Balanced
Care at Bloomsburg II, Inc. (incorporated by reference to Exhibit 10.2
of the Company's Current Report on Form 8-K dated March 18, 1999 File
No. 001-13845)
10.88 Balanced Care Corporation 1996 Stock Incentive Plan as Amended and
Restated, effective as of August 18, 1998 (incorporated by reference
to Annex A to the Proxy Statement on Schedule 14A dated October 6,
1998 (No. 001-13845))
10.89 Employment Agreement, dated as of September 20, 1995, by and between
Balanced Care Corporation and Robert J. Sutton (incorporated by
reference to Exhibit 10.39 to the Registration Statement on Form S-1
(No. 333-37833))**
10.90 Employment Agreement, dated as of August 1, 1996, by and between
Balanced Care Corporation and Brad E. Hollinger (incorporated by
reference to Exhibit 10.37 to the Registration Statement on Form S-1
(No. 333-37833))**
10.91 Employment Agreement, dated as of November 24, 1997, by and between
Balanced Care Corporation and Stephen G. Marcus (incorporated by
reference to Exhibit 10.43 to the Registration Statement on Form S-1
(No. 333-37833))**
10.92 Consulting Agreement between Pier C. Borra and Balanced Care
Corporation dated March 22, 1999, effective December 8, 1998
(incorporated by reference to Exhibit 10.1 to the Quarterly Report on
Form 10-Q for the quarter ended March 31, 1999 (No. 001-13845))
10.93 Employment Agreement between Clint T. Fegan and Balanced Care
Corporation dated February 11, 1999 (incorporated by reference to
Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter
ended March 31, 1999 (No. 001-13845))**
10.94 Form of Change in Control Agreement (incorporated by reference to
Exhibit 99.1 of the Company's Current Report on Form 8-K dated March
29, 1999 (No. 001-13845))**
10.95 Schedule to Form of Change in Control Agreement (incorporated by
reference to Exhibit 99.2 of the Company's Current Report on Form 8-K
dated March 29, 1999 (No. 001-13845))**
83
<PAGE> 21
10.96 First Amended and Restated Change in Control Agreement dated May 26,
1999 between Balanced Care Corporation and Mark S. Moore (previously
filed)**
10.97 Separation Agreement, dated as of July 13, 1999, by and between
Balanced Care Corporation and Paul A. Kruis (previously filed)**
10.98 Change in Control Agreement between Balanced Care Corporation and
Gary W. Anderson dated July 29, 1999 (previously filed)**
10.99 Separation Agreement, dated as of August 23, 1999, by and between
Balanced Care Corporation and Brian L. Barth (previously filed)**
21.1 Schedule of Subsidiaries of Balanced Care Corporation (previously
filed)
23.1 Independent Auditors' Consent -- KPMG LLP (previously filed)
27.1 Financial Data Schedule (previously filed)
84
<PAGE> 22
- ---------------
* Certain exhibits and schedules to the Exhibits attached hereto have been
omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any
omitted exhibit or schedule will be furnished to the Commission upon request.
** Management contract or compensatory plan or arrangement required to be filed
as an exhibit to this Annual Report on Form 10-K.
(b) Reports on Form 8-K: No Current Reports on Form 8-K were filed for the
quarter ended June 30, 1999.
(c) Exhibits:
See (a)(3) above.
(d) Financial Statement Schedule:
Schedule II -- Valuation and Qualifying Accounts.
All other schedules for which provision is made in the applicable
accounting regulations of the United States Securities and Exchange Commission
have been omitted because such schedules are not required under the related
instructions or are inapplicable or because the information required is included
in the consolidated financial statements or notes thereto.
85
<PAGE> 23
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the United States
Securities Exchange Act of 1934, the Registrant has duly caused this amendment
to its Annual Report to be signed on its behalf by the undersigned, thereunto
duly authorized.
BALANCED CARE CORPORATION
By: /s/ BRAD E. HOLLINGER
------------------------------------
Brad E. Hollinger
Chairman of the Board, President and
Chief Executive Officer
Date: October 27, 1999
86
<PAGE> 24
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
2.1 Asset Purchase Agreement among BCC of Wisconsin, Inc., the
Company and Urquhart Company dated as of September 30, 1998
(incorporated by reference to Exhibit 2.1 to the Quarterly
Report on Form 10-Q for the quarter ended December 31, 1998
(No. 001-13845))
3.1 Amended and Restated Certificate of Incorporation of Balanced Care
Corporation (incorporated by reference to Exhibit 3.1 to the
Registration Statement on Form S-1 (No. 333-37833))
3.2 Bylaws of Balanced Care Corporation, as amended (incorporated by
reference to Exhibit 3.2 to the Registration Statement on Form S-1
(No. 333-37833))
4.1 Form of Capital Stock Purchase Warrant, together with schedule
(incorporated by reference to Exhibit 4.9 to the Registration
Statement on Form S-1 (No. 333-37833))
4.2 Form of Capital Stock Purchase Warrant, together with schedule
(incorporated by reference to Exhibit 4.10 to the Registration
Statement on Form S-1 (No. 333-37833))
4.3 Form of Capital Stock Purchase Warrant, together with schedule
(incorporated by reference to Exhibit 4.11 to the Registration
Statement on Form S-1 (No. 333-37833))
10.1 Form of Meditrust Facility Lease Agreement, together with schedule
(incorporated by reference to Exhibit 10.46 to the Registration
Statement on Form S-1 (No. 333-37833))
10.2 Form of Meditrust Facility Lease Agreement (incorporated by reference
to Exhibit 10.2 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.3 Schedule to Form of Meditrust Facility Lease Agreement (incorporated
by reference to Exhibit 10.3 to the Company's Annual Report on Form
10-K for the year ended June 30, 1998 (No. 001-13845))
10.4 Form of Meditrust Option Agreement (incorporated by reference to
Exhibit 10.6 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.5 Schedule to Form of Meditrust Option Agreement (incorporated by
reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
</TABLE>
87
<PAGE> 25
10.6 Form of Meditrust Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.8 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.7 Schedule to Form of Meditrust Shortfall Funding Agreement (incorporated
by reference to Exhibit 10.9 to the Company's Annual Report on Form
10-K for the year ended June 30, 1998 (No. 001-13845))
10.8 Form of Meditrust Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.10 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.9 Schedule to Form of Meditrust Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.11 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.10 Form of Nationwide Health Properties, Inc. ("NHP") First Series Lease
and Security Agreement (incorporated by reference to Exhibit 10.12 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.11 Schedule to Form of NHP First Series Lease and Security Agreement
(incorporated by reference to Exhibit 10.13 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.12 Form of NHP Second Series Lease and Security Agreement (incorporated by
reference to Exhibit 10.14 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.13 Schedule to Form of NHP Second Series Lease and Security Agreement
(incorporated by reference to Exhibit 10.15 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.14 NHP First Series Master Investment Agreement (incorporated by reference
to Exhibit 10.18 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.15 NHP Second Series Master Investment Agreement (incorporated by
reference to Exhibit 10.19 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.16 Form of NHP First Series Option Agreement (incorporated by reference to
Exhibit 10.20 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
88
<PAGE> 26
<TABLE>
- --------------------------------------------------------------------------------
<S> <C>
10.17 Schedule to Form of NHP First Series Option Agreement (incorporated by
reference to Exhibit 10.21 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.18 Form of NHP Second Series Option Agreement (incorporated by reference
to Exhibit 10.22 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.19 Schedule to Form of NHP Second Series Option Agreement (incorporated by
reference to Exhibit 10.23 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.20 Form of NHP First Series Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.24 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.21 Schedule to Form of NHP First Series Shortfall Funding Agreement
(incorporated by reference to Exhibit 10.25 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.22 Form of NHP Second Series Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.26 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.23 Schedule to Form of NHP Second Series Shortfall Funding Agreement
(incorporated by reference to Exhibit 10.27 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.24 Form of NHP First Series Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.28 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.25 Schedule to Form of NHP First Series Working Capital Assurance
Agreement (incorporated by reference to Exhibit 10.29 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
10.26 Form of NHP Second Series Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.30 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.27 Schedule to Form of NHP Second Series Working Capital Assurance
Agreement (incorporated by reference to Exhibit 10.31 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
- --------------------------------------------------------------------------------
</TABLE>
89
<PAGE> 27
10.28 Form of American Health Properties, Inc. ("AHP") Lease and Security
Agreement (incorporated by reference to Exhibit 10.32 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
10.29 Schedule to Form of AHP Lease and Security Agreement (incorporated by
reference to Exhibit 10.33 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.30 Form of AHP Option Agreement (incorporated by reference to Exhibit
10.36 to the Company's Annual Report on Form 10-K for the year ended
June 30, 1998 (No. 001-13845))
10.31 Schedule to Form of AHP Option Agreement (incorporated by reference to
Exhibit 10.37 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.32 AHP Option Agreement II (incorporated by reference to Exhibit 10.38 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.33 Form of AHP Shortfall Funding Agreement, together with schedule
(incorporated by reference to Exhibit 10.75 to the Registration
Statement on Form S-1 (No. 333-37833))
10.34 Schedule to Form of AHP Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.40 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.35 Form of AHP Working Capital Assurance Agreement, together with
schedule (incorporated by reference to Exhibit 10.80 to the
Registration Statement on Form S-1 (No. 333-37833))
10.36 Schedule to Form of AHP Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.42 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.37 Form of Ocwen Financial Corporation ("Ocwen") Lease Agreement
(incorporated by reference to Exhibit 10.43 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.38 Schedule to Form of Ocwen Lease Agreement (incorporated by reference
to Exhibit 10.44 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
90
<PAGE> 28
10.39 Form of Ocwen Option Agreement (incorporated by reference to Exhibit
10.47 to the Company's Annual Report on Form 10-K for the year ended
June 30, 1998 (No. 001-13845))
10.40 Schedule to Form of Ocwen Option Agreement (incorporated by reference
to Exhibit 10.48 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.41 Form of Ocwen Shortfall Funding Agreement (incorporated by reference
to Exhibit 10.49 to the Company's Annual Report on Form 10-K for the
year ended June 30, 1998 (No. 001-13845))
10.42 Schedule to Form of Ocwen Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.50 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.43 Ocwen Shortfall Funding Agreement II (incorporated by reference to
Exhibit 10.51 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.44 Form of Ocwen Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.52 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.45 Schedule to Form of Ocwen Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.53 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.46 Ocwen Working Capital Assurance Agreement II (incorporated by
reference to Exhibit 10.54 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.47 First Amendment to Option Agreements, Shortfall Funding Agreements and
Stock Pledge Agreements (incorporated by reference to Exhibit 10.55 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.48 Form of Capstone Lease, together with schedule (incorporated by
reference to Exhibit 10.22 to the Registration Statement on Form S-1
(No. 333-37833))
10.49 Form of Capstone Lease (incorporated by reference to Exhibit 10.57 to
the Company's Annual Report on Form 10-K for the year ended June 30,
1998 (No. 001-13845))
10.50 Schedule to Form of Capstone Lease (incorporated by reference to
Exhibit 10.58 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
91
<PAGE> 29
10.51 Form of Capstone Option Agreement (incorporated by reference to
Exhibit 10.60 to the Company's Annual Report on Form 10-K for the year
ended June 30, 1998 (No. 001-13845))
10.52 Schedule to Form of Capstone Option Agreement (incorporated by
reference to Exhibit 10.61 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.53 Form of Capstone Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.62 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.54 Schedule to Form of Capstone Shortfall Funding Agreement (incorporated
by reference to Exhibit 10.63 to the Company's Annual Report on Form
10-K for the year ended June 30, 1998 (No. 001-13845))
10.55 Form of Capstone Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.64 to the Company's Annual Report on Form 10-K
for the year ended June 30, 1998 (No. 001-13845))
10.56 Schedule to Form of Capstone Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.65 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.57 Form of Capstone Assignment, Assumption and Amendment Agreement
(incorporated by reference to Exhibit 10.66 to the Company's Annual
Report on Form 10-K for the year ended June 30, 1998 (No. 001-13845))
10.58 Schedule to Form of Capstone Assignment, Assumption and Amendment
Agreement (incorporated by reference to Exhibit 10.67 to the Company's
Annual Report on Form 10-K for the year ended June 30, 1998 (No.
001-13845))
10.59 Lease, dated as of March 21, 1996, by and between HCPI Trust and BCC
at Mt. Royal Pines, Inc. (incorporated by reference to Exhibit 10.34
to the Registration Statement on Form S-1 (No. 333-37833))
10.60 First Amendment, dated as of March 31, 1997, to Lease dated as of
March 21, 1996 by and between HCPI Trust and BCC at Mt. Royal Pines,
Inc. (incorporated by reference to Exhibit 10.35 to the Registration
Statement on Form S-1 (No. 333-37833))
10.61 Loan and Security Agreement among Balanced Care Corporation and
certain of its wholly-owned subsidiaries and HCFP Funding, Inc. dated
April 22, 1999 (previously filed)
92
<PAGE> 30
10.62 Revolving Credit Note from Balanced Care Corporation and certain of
its wholly-owned subsidiaries in favor of HCFP Funding, Inc. dated
April 22, 1999 (previously filed)
10.63 Environmental Indemnity Agreement by Balanced Care Corporation and
certain of its wholly-owned subsidiaries in favor of HCFP Funding,
Inc. dated April 22, 1999 (previously filed)
10.64 Deed of Trust, Assignment of Rents and Leases and Security Agreement
from Balanced Care at North Ridge, Inc. in favor of HCFP Funding, Inc.
dated April 22, 1999 (previously filed)
10.65 Form of Open-Ended Mortgage, Assignment of Rents, Leases and Security
Agreement in favor of HCFP Funding, Inc. dated April 22, 1999
(previously filed)
10.66 Schedule to Form of Open-End Mortgage, Assignment of Rents, Leases and
Security Agreement in favor of HCFP Funding, Inc. dated April 22, 1999
(previously filed)
10.67 Accounts Receivable Intercreditor Agreement between HCFP Funding, Inc.
and Meditrust Mortgage Investments, Inc. dated April 22, 1999
(previously filed)
10.68 Amendment No. 1 to Loan and Security Agreement among Balanced Care
Corporation and certain of its wholly-owned subsidiaries and HCFP
Funding, Inc. dated July 1, 1999 (previously filed)
10.69 Amendment No. 2 to Loan and Security Agreement among Balanced Care
Corporation and certain of its wholly-owned subsidiaries and HCFP
Funding, Inc. dated July 29, 1999 (previously filed)
10.70 Form of HCRI Lease Agreement (incorporated by reference to Exhibit
10.1 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.71 Schedule to Form of HCRI Lease Agreement (incorporated by reference to
Exhibit 10.2 to the Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998 (No. 001-13845))
10.72 Form of HCRI Construction Disbursing Agreement (incorporated by
reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.73 Schedule to Form of HCRI Construction Disbursing Agreement
(incorporated by reference to Exhibit 10.4 to the Quarterly Report on
Form 10-Q for the quarter ended September 30, 1998 (No. 001-13845))
93
<PAGE> 31
<TABLE>
<S> <C>
10.74 Form of HCRI Option Agreement (incorporated by reference to Exhibit
10.5 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.75 Schedule to Form of HCRI Option Agreement (incorporated by reference to
Exhibit 10.6 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.76 Form of HCRI Shortfall Funding Agreement (incorporated by reference to
Exhibit 10.7 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.77 Schedule to Form of HCRI Shortfall Funding Agreement (incorporated by
reference to Exhibit 10.8 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.78 Form of HCRI Working Capital Assurance Agreement (incorporated by
reference to Exhibit 10.9 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.79 Schedule to Form of HCRI Working Capital Assurance Agreement
(incorporated by reference to Exhibit 10.10 to the Quarterly Report on
Form 10-Q for the quarter ended September 30, 1998 (No. 001-13845))
10.80 Form of HCRI Management Agreement (incorporated by reference to Exhibit
10.11 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.81 Schedule to Form of HCRI Management Agreement (incorporated by
reference to Exhibit 10.12 to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (No. 001-13845))
10.82 Form of HCRI Guaranty (incorporated by reference to Exhibit 10.13 to
the Quarterly Report on Form 10-Q for the quarter ended September 30,
1998 (No. 001-13845))
10.83 Schedule to Form of HCRI Guaranty (incorporated by reference to Exhibit
10.14 to the Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 (No. 001-13845))
10.84 Form of HCRI Loan Agreement (incorporated by reference to Exhibit 10.15
to the Quarterly Report on Form 10-Q for the quarter ended September
30, 1998 (No. 001-13845))
</TABLE>
94
<PAGE> 32
10.85 Schedule to Form of HCRI Loan Agreement (incorporated by reference to
Exhibit 10.16 to the Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998 (No. 001-13845))
10.86 Lease Agreement between Pennsylvania BCC Properties, Inc. and Balanced
Care at Saxonburg, Inc. (incorporated by reference to Exhibit 10.1 of
the Company's Current Report on Form 8-K dated March 18, 1999 No.
001-13845)
10.87 Lease Agreement between Pennsylvania BCC Properties, Inc. and Balanced
Care at Bloomsburg II, Inc. (incorporated by reference to Exhibit 10.2
of the Company's Current Report on Form 8-K dated March 18, 1999 File
No. 001-13845)
10.88 Balanced Care Corporation 1996 Stock Incentive Plan as Amended and
Restated, effective as of August 18, 1998 (incorporated by reference
to Annex A to the Proxy Statement on Schedule 14A dated October 6,
1998 (No. 001-13845))
10.89 Employment Agreement, dated as of September 20, 1995, by and between
Balanced Care Corporation and Robert J. Sutton (incorporated by
reference to Exhibit 10.39 to the Registration Statement on Form S-1
(No. 333-37833))**
10.90 Employment Agreement, dated as of August 1, 1996, by and between
Balanced Care Corporation and Brad E. Hollinger (incorporated by
reference to Exhibit 10.37 to the Registration Statement on Form S-1
(No. 333-37833))**
10.91 Employment Agreement, dated as of November 24, 1997, by and between
Balanced Care Corporation and Stephen G. Marcus (incorporated by
reference to Exhibit 10.43 to the Registration Statement on Form S-1
(No. 333-37833))**
10.92 Consulting Agreement between Pier C. Borra and Balanced Care
Corporation dated March 22, 1999, effective December 8, 1998
(incorporated by reference to Exhibit 10.1 to the Quarterly Report on
Form 10-Q for the quarter ended March 31, 1999 (No. 001-13845))
10.93 Employment Agreement between Clint T. Fegan and Balanced Care
Corporation dated February 11, 1999 (incorporated by reference to
Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter
ended March 31, 1999 (No. 001-13845))**
10.94 Form of Change in Control Agreement (incorporated by reference to
Exhibit 99.1 of the Company's Current Report on Form 8-K dated March
29, 1999 (No. 001-13845))**
10.95 Schedule to Form of Change in Control Agreement (incorporated by
reference to Exhibit 99.2 of the Company's Current Report on Form 8-K
dated March 29, 1999 (No. 001-13845))**
95
<PAGE> 33
10.96 First Amended and Restated Change in Control Agreement dated May 26,
1999 between Balanced Care Corporation and Mark S. Moore (previously
filed)**
10.97 Separation Agreement, dated as of July 13, 1999, by and between
Balanced Care Corporation and Paul A. Kruis (previously filed)**
10.98 Change in Control Agreement between Balanced Care Corporation and
Gary W. Anderson dated July 29, 1999 (previously filed)**
10.99 Separation Agreement, dated as of August 23, 1999, by and between
Balanced Care Corporation and Brian L. Barth (previously filed)**
21.1 Schedule of Subsidiaries of Balanced Care Corporation (previously
filed)
23.1 Independent Auditors' Consent -- KPMG LLP (previously filed)
27.1 Financial Data Schedule (previously filed)
96
<PAGE> 34
- ---------------
* Certain exhibits and schedules to the Exhibits attached hereto have been
omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any
omitted exhibit or schedule will be furnished to the Commission upon request.
** Management contract or compensatory plan or arrangement required to be filed
as an exhibit to this Annual Report on Form 10-K.
97
