<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 29, 1997
REGISTRATION NO. 333-23197
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------
AMENDMENT NO. 4
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------
AMERICAN RETIREMENT CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C> <C>
TENNESSEE 8059 62-1674303
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
</TABLE>
111 WESTWOOD PLACE, SUITE 402
BRENTWOOD, TENNESSEE 37027
(615) 221-2250
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
---------------------
W.E. SHERIFF
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
111 WESTWOOD PLACE, SUITE 402
BRENTWOOD, TENNESSEE 37027
(615) 221-2250
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent For Service)
---------------------
COPIES OF COMMUNICATIONS TO:
<TABLE>
<C> <C>
T. ANDREW SMITH JEFFREY S. LOWENTHAL
BASS, BERRY & SIMS PLC STROOCK & STROOCK & LAVAN LLP
FIRST AMERICAN CENTER 180 MAIDEN LANE
NASHVILLE, TENNESSEE 37238 NEW YORK, NEW YORK 10038
(615) 742-6200 (212) 806-5400
</TABLE>
---------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] ____________.
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] ____________.
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
<PAGE> 2
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated costs and expenses of the
Registrant in connection with the Offering described in the Registration
Statement.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 18,514
NASD fee.................................................... 6,610
New York Stock Exchange listing fee......................... 112,600
Accounting fees and expenses................................ 150,000*
Legal fees and expenses..................................... 375,000*
Printing and engraving expenses............................. 150,000*
Blue sky fees and expenses.................................. 2,500*
Transfer agent and registrar fees........................... 10,000*
Miscellaneous fees and expenses............................. 74,776*
--------
Total............................................. $900,000
========
</TABLE>
- ---------------
* Estimated.
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Tennessee Business Corporation Act ("TBCA") provides that a corporation
may indemnify any director or officer against liability incurred in connection
with a proceeding if (i) the director or officer acted in good faith, (ii) the
director or officer reasonably believed, in the case of conduct in his or her
official capacity with the corporation, that such conduct was in the
corporation's best interest, or, in all other cases, that his or her conduct was
not opposed to the best interests of the corporation, and (iii) in connection
with any criminal proceeding, the director or officer had no reasonable cause to
believe that his or her conduct was unlawful. In actions brought by or in the
right of the corporation, however, the TBCA provides that no indemnification may
be made if the director or officer is adjudged to be liable to the corporation.
Similarly, the TBCA prohibits indemnification in connection with any proceeding
charging improper personal benefit to a director or officer, if such director or
officer is adjudged liable on the basis that a personal benefit was improperly
received. In cases where the director or officer is wholly successful, on the
merits or otherwise, in the defense of any proceeding instigated because of his
or her status as a director or officer of a corporation, the TBCA mandates that
the corporation indemnify the director or officer against reasonable expenses
incurred in the proceeding. Notwithstanding the foregoing, the TBCA provides
that a court of competent jurisdiction, upon application, may order that a
director or officer be indemnified for reasonable expense if, in consideration
of all relevant circumstances, the court determines that such individual is
fairly and reasonably entitled to indemnification, whether or not the standard
of conduct set forth above was met.
The Charter and Bylaws of the Company provide that the Company will
indemnify from liability, and advance expenses to, any present or former
director or officer of the Company to the fullest extent allowed by the TBCA, as
amended from time to time, or any subsequent law, rule, or regulation adopted in
lieu thereof. Additionally, the Charter provides that no director of the Company
will be personally liable to the Company or any of its shareholders for monetary
damages for breach of any fiduciary duty except for liability arising from (i)
any breach of a director's duty of loyalty to the Company or its shareholders,
(ii) acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) any unlawful distributions, or (iv)
receiving any improper personal benefit.
The Company has purchased a directors and officers insurance policy
providing for $10.0 million in coverage for certain liabilities of the Company's
directors and officers. The policy expires in May 2000.
II-1
<PAGE> 3
The proposed form of the Underwriting Agreement to be filed as Exhibit 1 to
this Registration Statement contains certain provisions relating to the
indemnification of the Company and its controlling persons by the Underwriters
and relating to the indemnification of the Underwriters by the Company and its
controlling persons.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
All of the shares of Common Stock outstanding on the date hereof will be
distributed to the Registrant's shareholders immediately prior to the
effectiveness of the Offering in connection with the transfer of assets to the
Registrant by an affiliated limited partnership and the simultaneous liquidation
of the affiliated limited partnership. Prior to such distribution, the
Registrant's shareholders have been partners of the affiliated limited
partnership. In accordance with the provisions of the limited partnership's
Partnership Agreement, the partners voted prior to the filing of this
Registration Statement to organize the Registrant and liquidate the limited
partnership, subject only to the effectiveness of the Offering. The Registrant
believes that the distribution of shares of Common Stock by the affiliated
limited partnership will be an exempt transaction in accordance with Section
4(2) of the Securities Act of 1933, as amended, and Rule 506 of Regulation D
promulgated thereunder.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) The following exhibits are filed as part of the Registration Statement:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
1 -- Form of Underwriting Agreement*
2.1 -- Limited Partnership Agreement of American Retirement
Communities, L.P., dated February 7, 1995, as amended April
1, 1995*
2.2 -- Articles of Share Exchange between American Retirement
Communities, L.P., and American Retirement Corporation,
dated March 31, 1995 (including attached Plan and Agreement
of Share Exchange)*
2.3 -- Reorganization Agreement, dated February 28, 1997
3.1 -- Charter of the Registrant*
3.2 -- Bylaws of the Registrant*
4.1 -- Specimen Common Stock certificate*
4.2 -- Article 8 of the Registrant's Charter (included in Exhibit
3.1)
5 -- Opinion of Bass, Berry & Sims PLC*
10.1 -- American Retirement Corporation 1997 Stock Incentive Plan*
10.2 -- American Retirement Corporation Employee Stock Purchase
Plan*
10.3 -- American Retirement Corporation 401(k) Retirement Plan*
10.4 -- Officers' Incentive Compensation Plan*
10.5 -- Registration Rights Policy*
10.6 -- Lease and Security Agreement, dated January 2, 1997, by and
between Nationwide Health Properties, Inc. and American
Retirement Communities, L.P.*
10.7 -- Lease and Security Agreement, dated January 2, 1997, by and
between N.H. Texas Properties Limited Partnership and
Trinity Towers Limited Partnership*
10.8 -- Amended and Restated Loan Agreement, dated December 21,
1994, between Carriage Club of Denver, L.P. and General
Electric Capital Corporation*
10.9 -- Amended and Restated Promissory Note, dated December 21,
1994 between Carriage Club of Denver, L.P. and General
Electric Capital Corporation*
10.10 -- Assumption, Consent and Loan Modification Agreement, dated
February 8, 1995, by and among Carriage Club of Denver,
L.P., American Retirement Communities, and General Electric
Capital Corporation*
10.11 -- Loan Agreement, dated October 31, 1995, by and between
American Retirement Communities, L.P. and First Union
National Bank of Tennessee, as amended*
10.12 -- Amended and Restated Promissory Note, dated October 31,
1995, by American Retirement Communities, L.P. to First
Union National Bank of Tennessee, as amended*
10.13 -- Revolving Credit Promissory Note, dated October 31, 1995, by
American Retirement Communities, L.P. to First Union
National Bank of Tennessee, as amended*
</TABLE>
II-2
<PAGE> 4
<TABLE>
<C> <C> <S>
10.14 -- Standby Note, dated October 31, 1995, by American Retirement Communities, L.P. to First Union
National Bank of North Carolina*
10.15 -- Reimbursement Agreement, dated October 31, 1995, between American Retirement Communities, L.P. and
First Union National Bank of North Carolina, as amended*
10.16 -- Loan Agreement, dated January 4, 1996, between General Electric Capital Corporation and Fort Austin
Limited Partnership*
10.17 -- Promissory Note, dated January 4, 1996, by Fort Austin Limited Partnership to General Electric
Capital Corporation*
10.18 -- Promissory Note, dated April 1, 1992, by Fort Austin Limited Partnership to General Electric Capital
Corporation, as amended*
10.19 -- Loan Agreement, dated May 7, 1996, between ARCLP-Charlotte, LLC, American Retirement Communities,
L.P. and General Electric Capital Corporation*
10.20 -- Junior Promissory Note, dated May 7, 1996, by ARCLP-Charlotte, LLC and American Retirement
Communities, L.P. to General Electric Capital Corporation*
10.21 -- Senior Promissory Note, dated May 7, 1996, by ARCLP-Charlotte, LLC and American Retirement
Communities, L.P. to General Electric Capital Corporation*
10.22 -- Construction Loan Agreement, dated March 14, 1997, between Fort Austin Limited Partnership and First
Union National Bank of Tennessee*
10.23 -- Construction Loan Addendum, dated March 28, 1997, between First Union National Bank of Tennessee and
Fort Austin Limited Partnership*
10.24 -- Promissory Note, dated March 28, 1997, by Fort Austin Limited Partnership to First Union National
Bank of Tennessee*
10.25 -- Letter of Intent, dated April 3, 1997, by National Health Investors, Inc. to American Retirement
Corporation*
10.26 -- Master Loan Agreement, dated December 23, 1996, between First American National Bank and American
Retirement Communities, L.P.*
10.27 -- Letter of Intent, dated February 24, 1997, by Nationwide Health Properties, Inc. to American
Retirement Corporation*
11 -- Statement re Computation of Per Share Earnings*
21 -- Subsidiaries of the Registrant
23.1 -- Consent of KPMG Peat Marwick LLP*
23.2 -- Consent of Bass, Berry & Sims PLC (included in Exhibit 5)
24 -- Power of Attorney*
27 -- Financial Data Schedule (for SEC use only)*
</TABLE>
- ---------------
* Previously filed
(b) Financial Statement Schedules
Schedule II -- Valuation and Qualifying Accounts
All other schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission are not
required under the related instructions or are inapplicable, and therefore
have been omitted.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes to provide to the
Underwriters, at the closing specified in the Underwriting Agreement,
certificates in such denominations and registered in such names as required by
the Underwriters to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers, and controlling persons of the
Registrant pursuant to the provisions described under Item 14 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer, or controlling
person of the Registrant in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer, or controlling person
II-3
<PAGE> 5
in connection with the securities being registered hereunder, the Registrant
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Nashville, Tennessee on May 29, 1997.
AMERICAN RETIREMENT CORPORATION
By: /s/ W.E. SHERIFF
------------------------------------
W.E. Sheriff
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ W.E. SHERIFF Chairman and Chief Executive May 29, 1997
- ----------------------------------------------------- Officer (Principal Executive
W.E. Sheriff Officer)
/s/ GEORGE T. HICKS Executive Vice May 29, 1997
- ----------------------------------------------------- President -- Finance, Chief
George T. Hicks Financial Officer (Principal
Financial and Accounting
Officer)
* Director May 29, 1997
- -----------------------------------------------------
H. Lee Barfield II
* Director May 29, 1997
- -----------------------------------------------------
Jack O. Bovender, Jr.
* Director May 29, 1997
- -----------------------------------------------------
Frank M. Bumstead
* Director May 29, 1997
- -----------------------------------------------------
Robin G. Costa
* Director May 29, 1997
- -----------------------------------------------------
Clarence Edmonds
* Director May 29, 1997
- -----------------------------------------------------
John A. Morris, Jr., M.D.
* Director May 29, 1997
- -----------------------------------------------------
Daniel K. O'Connell
* Director May 29, 1997
- -----------------------------------------------------
Nadine C. Smith
* Director May 29, 1997
- -----------------------------------------------------
Lawrence J. Stuesser
* /s/ W. E. SHERIFF
- -----------------------------------------------------
W.E. Sheriff, Attorney-in-fact
</TABLE>
II-5
<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C> <C>
1 -- Form of Underwriting Agreement*
2.1 -- Limited Partnership Agreement of American Retirement
Communities, L.P., dated February 7, 1995, as amended April
1, 1995*
2.2 -- Articles of Share Exchange between American Retirement
Communities, L.P., and American Retirement Corporation,
dated March 31, 1995 (including attached Plan and Agreement
of Share Exchange)*
2.3 -- Reorganization Agreement, dated February 28, 1997
3.1 -- Charter of the Registrant*
3.2 -- Bylaws of the Registrant*
4.1 -- Specimen Common Stock certificate*
4.2 -- Article 8 of the Registrant's Charter (included in Exhibit
3.1)
5 -- Opinion of Bass, Berry & Sims PLC*
10.1 -- American Retirement Corporation 1997 Stock Incentive Plan*
10.2 -- American Retirement Corporation Employee Stock Purchase
Plan*
10.3 -- American Retirement Corporation 401(k) Retirement Plan*
10.4 -- Officers' Incentive Compensation Plan*
10.5 -- Registration Rights Policy*
10.6 -- Lease and Security Agreement, dated January 2, 1997, by and
between Nationwide Health Properties, Inc. and American
Retirement Communities, L.P.*
10.7 -- Lease and Security Agreement, dated January 2, 1997, by and
between N.H. Texas Properties Limited Partnership and
Trinity Towers Limited Partnership*
10.8 -- Amended and Restated Loan Agreement, dated December 21,
1994, between Carriage Club of Denver, L.P. and General
Electric Capital Corporation*
10.9 -- Amended and Restated Promissory Note, dated December 21,
1994 between Carriage Club of Denver, L.P. and General
Electric Capital Corporation*
10.10 -- Assumption, Consent and Loan Modification Agreement, dated
February 8, 1995, by and among Carriage Club of Denver,
L.P., American Retirement Communities, and General Electric
Capital Corporation*
10.11 -- Loan Agreement, dated October 31, 1995, by and between
American Retirement Communities, L.P. and First Union
National Bank of Tennessee, as amended*
10.12 -- Amended and Restated Promissory Note, dated October 31,
1995, by American Retirement Communities, L.P. to First
Union National Bank of Tennessee, as amended*
10.13 -- Revolving Credit Promissory Note, dated October 31, 1995, by
American Retirement Communities, L.P. to First Union
National Bank of Tennessee, as amended*
10.14 -- Standby Note, dated October 31, 1995, by American Retirement
Communities, L.P. to First Union National Bank of North
Carolina*
10.15 -- Reimbursement Agreement, dated October 31, 1995, between
American Retirement Communities, L.P. and First Union
National Bank of North Carolina, as amended*
10.16 -- Loan Agreement, dated January 4, 1996, between General
Electric Capital Corporation and Fort Austin Limited
Partnership*
10.17 -- Promissory Note, dated January 4, 1996, by Fort Austin
Limited Partnership to General Electric Capital Corporation*
10.18 -- Promissory Note, dated April 1, 1992, by Fort Austin Limited
Partnership to General Electric Capital Corporation, as
amended*
10.19 -- Loan Agreement, dated May 7, 1996, between ARCLP-Charlotte,
LLC, American Retirement Communities, L.P. and General
Electric Capital Corporation*
10.20 -- Junior Promissory Note, dated May 7, 1996, by
ARCLP-Charlotte, LLC and American Retirement Communities,
L.P. to General Electric Capital Corporation*
10.21 -- Senior Promissory Note, dated May 7, 1996, by
ARCLP-Charlotte, LLC and American Retirement Communities,
L.P. to General Electric Capital Corporation*
10.22 -- Construction Loan Agreement, dated March 14, 1997, between
Fort Austin Limited Partnership and First Union National
Bank of Tennessee*
10.23 -- Construction Loan Addendum, dated March 28, 1997, between
First Union National Bank of Tennessee and Fort Austin
Limited Partnership*
10.24 -- Promissory Note, dated March 28, 1997, by Fort Austin
Limited Partnership to First Union National Bank of
Tennessee*
10.25 -- Letter of Intent, dated April 3, 1997, by National Health
Investors, Inc. to American Retirement Corporation*
10.26 -- Master Loan Agreement, dated December 23, 1996, between
First American National Bank and American Retirement
Communities, L.P.*
</TABLE>
<PAGE> 8
<TABLE>
<S> <C> <C>
10.27 -- Letter of Intent, dated February 24, 1997, by Nationwide Health Properties, Inc. to American Retirement
Corporation*
11 -- Statement re Computation of Per Share Earnings*
21 -- Subsidiaries of the Registrant
23.1 -- Consent of KPMG Peat Marwick LLP*
23.2 -- Consent of Bass, Berry & Sims PLC (included in Exhibit 5)
24 -- Power of Attorney*
27 -- Financial Data Schedule (for SEC use only)*
</TABLE>
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* Previously filed
<PAGE> 1
Exhibit 2.3
REORGANIZATION AGREEMENT
THIS REORGANIZATION AGREEMENT, dated to be effective as of February 28,
1997, is by and between AMERICAN RETIREMENT CORPORATION, a Tennessee corporation
(the "Corporation"), and AMERICAN RETIREMENT COMMUNITIES, L.P., a Tennessee
limited partnership (the "Partnership").
The Corporation is a wholly-owned subsidiary of the Partnership. The
Partnership desires to reorganize itself into corporate form in order to effect
an initial public offering (the "IPO"). In furtherance thereof, the Partnership
and the Corporation desire that the Partnership transfer all of its assets,
subject to all of its liabilities, to the Corporation in exchange for a
promissory note and shares of common stock of the Corporation, all as more fully
described below.
The exchanges contemplated by this Reorganization Agreement are intended to
qualify for tax-free treatment under section 351(a) of the Internal Revenue Code
of 1986, as amended (the "Code"), except that the promissory note referenced in
paragraph 3 will be "other property" or "boot" as described in section 351(b) of
the Code. The transferors will include the Partnership and the members of the
public acquiring common stock from the underwriter in a qualified underwriting
transaction described in Treasury Regulation ss.1.351-1(a)(3). The transferors
will own all the common stock of the Corporation immediately after the exchange.
The transfer of assets and liabilities of the Partnership, followed by its
termination, is intended to comply with the procedure for tax-free incorporation
of a partnership described in Situation 1 of IRS Revenue Ruling 84-111.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the parties hereto agree as follows:
1. Agreement to Contribute Assets. In consideration of the issuance to the
Partnership of the Reorganization Note and the Exchange Shares (each as
hereinafter defined), the Partnership shall contribute to the Corporation all of
its right, title and interest in and to all of its assets (the "Contributed
Assets").
2. Assumption of Liabilities. Contemporaneously with the Partnership's
contribution of the Contributed Assets, the Corporation shall assume all of the
Partnership's liabilities and obligations, known or unknown, contingent or
otherwise, (the "Assumed Liabilities").
3. Agreement to Issue Reorganization Note. In consideration of the
Partnership's contribution of the Contributed Assets, the Corporation shall
issue, and the Partnership shall accept a promissory note in the principal
amount of $25.0 million (the "Reorganization Note"), which shall not bear
interest and shall be payable upon the closing of any initial public offering by
the Corporation of its securities. Notwithstanding the foregoing, the
Corporation and the General Partner of the Partnership (in consultation with the
Partnership's Limited Partners Committee) shall
1
<PAGE> 2
have the right to vary the principal amount of the Reorganization Note so long
as the final amount thereof is between $20 million and $30 million.
4. Agreement to Contribute and Issue Shares. In consideration of the
Partnership's contribution of the Contributed Assets, the Corporation shall
issue, and the Partnership shall acquire, an aggregate of 7,811,500 shares of
common stock, par value $.01 per share, of the Corporation (the "Exchange
Shares").
5. Initial Public Offering. Following the issuance of the Exchange Shares,
the Corporation shall offer for sale to the public for cash approximately
3,125,000 newly issued shares of its common stock.
6. Shares Fully Paid. The Corporation represents to the Partnership that
the issuance of the Exchange Shares pursuant to this Agreement has been duly
authorized and, when issued in accordance with the terms of this Agreement, the
Exchange Shares will be fully paid and non-assessable, and free of preemptive
rights.
7. Representations and Warranties of the Partnership. The Partnership
hereby:
(a) represents and warrants that (i) it has good and marketable title to
all of the Contributed Assets, free and clear of any liens or other encumbrances
except for liens and encumbrances (x) securing the indebtednesses described or
to be described in the Registration Statement (defined below) or the exhibits
thereto, or (y) arising in the ordinary course of business that do not
materially affect their value, or (z) relating to real property that do not
materially affect the use or operation thereof; and (ii) all Contributed Assets
which constitute capital stock were duly authorized and validly issued and are
fully paid, nonassessable and free of preemptive rights;
(b) represents and warrants that the Partnership has paid in full or
will pay in full on a timely basis all federal or state income taxes incurred
by such entities for the taxable period ending on or before the Closing;
(c) acknowledges that the Partnership or its representative(s) has had
access to the same kind of information concerning the Corporation that is
required in a Registration Statement on Form S-1 filed under the Securities Act
of 1933, as amended (the "Act"), to the extent that the Corporation possesses
such information;
(d) acknowledges that it has been advised that the offer and issuance of
the Exchange Shares have not been registered under the Act;
(e) represents and warrants that the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby by the Partnership will not (i) result in a violation of
or be in conflict with or constitute, with or without the passage of time or
giving of notice, a default under the Partnership's partnership agreement or
under any instrument,
2
<PAGE> 3
judgment, order, writ, decree or contract to which the Partnership is subject,
(ii) result in the creation of any lien, charge or encumbrance upon any assets
of the Partnership, or (iii) violate any law, rule or regulation applicable to
the Partnership.
8. Closing. The closing (the "Closing") of the transactions contemplated by
this Agreement shall be held at the offices of Bass, Berry & Sims PLC, 2700
First American Center, Nashville, Tennessee, immediately prior to the
effectiveness of the Registration Statement on Form S-1 to be filed by the
Corporation with the Securities and Exchange Commission with respect to the
common stock of the Corporation (as amended, the "Registration Statement"), at
which time the transactions contemplated hereby shall be deemed to be
effective. At the Closing:
(a) The Partnership shall deliver to the Corporation:
(i) certificates, duly endorsed for transfer, representing the
shares of stock that comprise a part of the Contributed Assets;
(ii) such deeds, bills of sale, assignments and other instruments
of transfer or title as the Corporation may reasonably request with
respect to the remainder of the Contributed Assets; and
(iii) such other documents as the Corporation shall reasonably
request.
(b) The Corporation shall issue and deliver to the Partnership:
(i) the Reorganization Note;
(ii) a certificate or certificates representing the Exchange
Shares in Section 4; and
(iii) an Assumption Agreement relating to all of the Assumed
Liabilities.
9. Survival of Representations and Warranties; Obligation of Partnership to
Indemnify.
(a) The representations and warranties of the Partnership set forth in
Section 7 of this Agreement shall survive Closing.
(b) The Partnership agrees to indemnify and hold harmless the
Corporation, its directors, officers and agents (in their capacity as such) from
and against any costs and expenses (including, without limitation, the
reasonable fees, disbursements and other charges of counsel) based upon, arising
out of or otherwise in respect of any inaccuracy in or any breach of any
representations, warranty, covenant or Agreement of the Partnership contained in
this Agreement or the enforcement of this Agreement.
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<PAGE> 4
10. Repayment of Reorganization Note. Immediately following the
consummation of the Offering, the Corporation shall repay the Reorganization
Note in full from the proceeds of the Offering.
11. Liquidation of the Partnership. As soon as practicable following the
Closing, the Partnership will distribute the proceeds of the Reorganization Note
and the Exchange Shares, as described in the Registration Statement, whereupon
the Partnership will be considered terminated for federal income tax purposes.
The Partnership will thereafter be legally dissolved and liquidated; provided,
however, that such liquidation shall be delayed if necessary until all operating
licenses and permits are effectively transferred to the Corporation.
12. Notices. Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, telecopied or
sent by recognized overnight courier. Any such notice shall be deemed given when
so delivered personally or telecopied or, if delivered by recognized overnight
courier, one day after the date of delivery to such courier, as follows:
(i) if to the Corporation, to:
American Retirement Corporation
111 Westwood Place, Suite 402
Brentwood, TN 37027
Attention: President
(ii) if to the Partnership, to:
American Retirement Communities, L.P.
111 Westwood Place, Suite 402
Brentwood, TN 37027
Attention: W.E. Sheriff
Any party may change such party's address for notice hereunder by notice to
the other parties in accordance with this Section 11.
13. Termination. This Agreement may be terminated at the election of any
party upon written notice to the other party if the Registration Statement has
not been declared to be effective on or prior to August 31, 1997, or such later
date as the parties may hereafter agree and, if so terminated, no party shall
have any further liability or obligation hereunder.
14. Waivers and Amendments. This Agreement may be amended, modified,
superseded or canceled, and the terms and conditions hereof may be waived, only
by a written instrument signed by the parties or, in the case of a waiver, by
the party waiving compliance. No delay on the part of any party in exercising
any right or remedy hereunder shall operate as a waiver thereof, nor shall any
waiver on the part or any party of any such right or remedy, nor any single or
partial exercise of any
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such right or remedy preclude any other or further exercise thereof or the
exercise of any other right or remedy.
15. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Tennessee applicable to agreements
made and to be performed entirely within such state.
16. Assignment. This Agreement, and any rights or obligations hereunder,
may not be assigned by any party hereto without the prior written consent of the
other parties.
17. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.
IN WITNESS WHEREOF, each party hereto has executed or caused the execution
of this Agreement as of the date first above written.
AMERICAN RETIREMENT CORPORATION
By:____________________________________________
W. E. Sheriff, President and Chief Executive
Officer
AMERICAN RETIREMENT COMMUNITIES, L.P.
By: American Retirement Communities, LLC, its
general partner
By:_______________________________________
W.E. Sheriff, Chief Manager
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EXHIBIT 21
Subsidiaries of the Registrant
American Retirement Corporation II, a Tennessee corporation
ARCLP - Charlotte, LLC, a Tennessee limited liability company
A.R.C. Management Corporation, a Tennessee corporation
ARC Corpus Christi, Inc., a Tennessee corporation
ARC Oak Park, Inc., a Tennessee corporation
ARC Equities - Lexington, Inc., a Tennessee corporation
ARC Fort Austin Properties, Inc., a Tennessee corporation
Fort Austin Limited Partnership, a Texas limited partnership
Trinity Towers Limited Partnership, a Tennessee limited partnership
Holley Court Terrace, L.P., a Tennessee limited partnership
A.R.C. Chattanooga, Inc. , a Tennessee corporation
ARC Tarpon Springs, Inc., a Tennessee corporation
ARC Sun City Center, Inc., a Tennessee corporation
