1
February 10, 2009
To whom it may concern:
Assignment of "Barrington House" Resident Paid, Residential Style Nursing Home
Business from ZECS Active Senior Co., Ltd.
This is to inform you that a meeting of the Board of Directors of Barrington Successor Corp. ("BH Successor" hereinafter) convened on February 10, 2009 resolved to accept assignment of the "Barrington House" resident-paid, residential-style nursing home business ("the Business" hereinafter) from ZECS Active Senior Co., Ltd. ("ZECS Active Senior" hereinafter), a subsidiary of ZECS Co., Ltd. ("ZECS" hereinafter) and entered into a split off agreement the same day. BH Successor is a receiver company newly established by RADIA HOLDINGS.
Details
1.
Reason for assignment of business
(1)
Events leading up to assignment of business
After entering into a real estate purchase and sale agreement with ZECS on September 21, 2007
for the Barrington House fixed assets (two resident-paid, residential-style nursing home facilities) owned by the company, we were forced to postpone delivery of the properties until necessary procedures could be complied with. During that time, a fixed-term building lease agreement was entered into with ZECS Active Senior, a subsidiary of ZECS, and the facilities were managed by ZECS Active Senior.
The real estate purchase and sale agreement has already been canceled due to non-fulfillment of
obligations on the part of ZECS Active Senior and ZECS (see "Cancellation of Fixed Asset Assignment Agreement" published on October 21, 2008) and suit (countersuit) was filed against ZECS seeking payment of penalty for breach etc. in conjunction with the cancellation (see "Suit Filed against ZECS Co., Ltd." published on January 9, 2009).
(2)
Reason for assignment
Placing the highest priority on avoiding any impairment to the provision of services to clients of
Barrington House Baji Koen and also desiring to avoid any significant deterioration in the value of the Barrington House business, we caused subsidiary BH Successor to receive assignment of the operations of operating-company ZECS Active Senior. These events took place separately from the suit.
Company:
RADIA HOLDINGS, INC.
Representative: Shinichi Horii
Representative Director and President
(Code No. 4723 TSE 2nd Section)
Contact: Hideshi
Tachiyama
Senior Executive Officer General Manager, Public Relations and Investor Relations Division
(TEL:
03-3405-9262)
2
Operations by the successor company are temporary until a new assignee can be finalized. We
will continue to exert every effort to maintain the continuity of services to clients, and finding an assignee with greater financial and operational stability remains our highest priority.
2.
Profile of business assignment
(1)
Description of business
"Barrington House" resident-paid, residential-style nursing home business operated by ZECS Active Senior
[2 facilities]
"Barrington House Baji Koen" and "Barrington House Kichijoji"
*
Note that there are no clients in Barrington House Kichijoji at this time.
(2)
Business scheme
1
RADIA HOLDINGS establishes BH Successor as a receiver for the Business.
2
RADIA HOLDINGS enters into a split agreement ("Corporate Split" hereinafter) enabling it to receive the Business from ZECS Active Senior in the form of an absorption-type split by BH Successor.
3
As quickly as possible after 1 and 2, BH Successor files applications, etc. required to operate the Business under the Geriatric Welfare Law.
4
On the split date, BH Successor receives assignment of the Business and pays to ZECS Active Senior 1 yen in cash as counter value.
(3)
Method of split
ZECS Active Senior will be the split company and BH Successor will be the succeeding company (company to which business is assigned) in an absorption-type split.
(4)
Major rights and obligations assigned to the succeeding company (company to which business is
assigned)
On the split date, BH Successor will be assigned the assets, liabilities, contractual positions and contractual rights and obligations associated with the Business and stipulated separately in the split agreement. We will disclose details as soon as they are finalized.
(5)
Business results of assigned business unit
"Barrington House" resident-paid, residential-style nursing home business operated by ZECS Active Senior
FYE May 2008
Revenues
248 million yen
Net income
-712 million yen
(6)
Assignment price and method of settlement
Assignment price:
1 yen
Method of settlement:
To be paid in cash
3.
Assignment schedule
Board of Directors approval of split agreement etc. (BH Successor)
February 10, 2009
Signing of split agreement (BH Successor)
February 10, 2009
General Meeting of Shareholders approval of split agreement (BH Successor)
By the day before the Split date
3
Split date (effective date)
March 13, 2009 (tentative)
*This schedule may be changed depending on the proceedings of the application made to the relevant authorities, etc.
4.
Profile of assigning company
(1)
Name
ZECS Active Senior Co., Ltd.
(2)
Representative Tsutomu
Inoue
(3)
Address
4-12-24 Nishi Azabu, Minato-ku, Tokyo
(4)
Established
August 6, 2007
(5)
Main lines of business
Operation of resident-paid, residential-style nursing home business
(6)
Settlement term
May
(7)
Employees 25
(8)
Capital
30 million yen
(9)
Total issued and outstanding shares
2 shares
(10)
Shareholder structure
ZECS Active Age Co., Ltd. (100%)
5.
Forecast
The impact of this matter on this year's consolidated results will be negligible.
End of document
[Reference]
Profile of successor company (assignee)
(1)
Name Barrington
Successor
Corp.
(2)
Representative Mitsuaki
Matsusaka
(3)
Address
6-10-1 Roppongi, Minato-ku, Tokyo
(4)
Established
January 30, 2009
(5)
Main lines of business
Operation of resident-paid, residential-style nursing home business
(6)
Settlement term
June
(7)
Employees 1
(8)
Capital
10 million yen
(9)
Total issued and outstanding shares
200 shares
(10)
Shareholder structure
RADIA HOLDINGS, Inc. (100%)
