Exhibit 2.5
FIRST AMENDMENT TO
STOCK PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT dated as of June 30,
1998 is among BEVERLY ENTERPRISES, INC., a Delaware corporation (`Seller"),
SELECT MEDICAL CORPORATION, a Delaware corporation, and AMERICAN TRANSITIONAL
HOSPITALS, INC., a Delaware corporation (the "Company").
Recitals
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A. Sellers, Buyer and the Company are parties to that certain Stock
Purchase Agreement (the "Agreement") dated as of May 29, 1998. Capitalized terms
used herein without definition shall have the meanings assigned such terms in
the Agreement.
B. The parties hereto desire to amend the Agreement as set forth
herein.
Agreement
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NOW, THEREFORE, in consideration of the premises contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereby agree as follows:
1. SunCare Respiratory Services, Inc. Respiratory Therapy Covenant
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Not to Compete. Buyer and the Company acknowledge that Seller has certain
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contractual obligations pursuant to that certain RT Covenant Not to Compete (the
"SunCare Covenant Not to Compete") among Spectra Healthcare Alliance, Inc.
("Spectra"), the Seller and SunCare Respiratory Services, Inc., a copy of which
is attached as Exhibit A hereto. Each of Buyer and the Company hereby agree to
be bound by and take all actions contemplated by the provisions of Section IX of
the SunCare Covenant Not to Compete, and agrees not to take or omit to take any
action that would cause any breach or violation under the SunCare Covenant Not
to Compete. Nothing contained herein shall create any rights in third parties,
and there shall be no third party beneficiaries hereof.
2. Estimated Closing Consolidated Net Working Capital. Section
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1.2(b) of the Agreement is hereby amended by deleting the phrase "the last day
of the full month immediately preceding the month in which the Closing occurs"
in the sixth and seventh lines thereof and inserting "March 31, 1998" in place
thereof.
3. Cooperation. Section 6.10 of the Agreement is hereby amended and
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restated in its entirety to read as follows:
Each party shall cooperate with the other in connection with (i) the filing
of any Medicare and/or Medicaid cost reports required to be filed after the
Closing Date; (ii) the determination of any liability or right relating to
such rights and (iii) subject to Section 6.8, the conduct or defense of any
investigation, audit or other proceeding. Subject to Section 6.11 hereof,
Buyer, ATH, the Subsidiaries and Seller, and their respective affiliates,
shall preserve all information, returns, books, records, documents and
supporting materials, and shall provide access to employees and former
employees, until the later of the expiration of all applicable statutes of
limitation and extensions thereof, or the conclusion of all litigation.
4. Effect; Ratification. The amendments set forth herein are
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effective solely for the purposes set forth herein and shall be limited
precisely as written, and shall not be deemed to be a consent to any amendment,
waiver or modification of any other term or condition of the Agreement. This
Amendment shall be construed in connection with and as part of the Agreement and
all terms, conditions, representations, warranties, covenants and agreements set
forth in the Agreement, except as herein amended, are hereby ratified and
confirmed and shall remain in full force and effect.
5. Counterparts. This Amendment may be executed in any number of
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counterparts, each such counterpart constituting an original but all together
constitute one and the same instrument.
6. Severability. Any provision contained in this Amendment that is
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held to be inoperative, unenforceable or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable or invalid without affecting
the remaining provisions of this Amendment in that jurisdiction or the
operation, enforceability or validity of that provision in any other
jurisdiction.
7. Governing Law. This Amendment shall be construed and enforced in
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accordance with the internal laws of the State of Tennessee with the exception
of its conflict of laws provisions, which shall not apply.
8. Effect of Headings and Captions. The captions of Articles and
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Sections of this Amendment have been inserted solely for convenience of
reference, and shall not control or affect the meaning of construction of any of
the provisions of this Amendment.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed on their respective behalf, by their respective duly authorized
officers, as of the date first above written.
SELECT MEDICAL CORPORATION
By: Michael E. Tarvin
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Name: Michael E. Tarvin
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Title: Vice President
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BEVERLY ENTERPRISES, INC.
By: David G. Merrell
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Name: David G. Merrell
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Title: Vice President
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AMERICAN TRANSITIONAL HOSPITALS, INC
By: David G. Merrell
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Name: David G. Merrell
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Title: Vice President
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