2011-11-07T18:00:15-06:00 2010-12-31 CROWE HORWATH LLP 70 West Madison Street Suite 700 Chicago IL 606024903 990 2010-01-01 010706736 AMERICAN EAGLE LIFECARE CORPORATION AMER 6152522305 1600 Division Street Nashville TN 37203 F SCOTT KELLMAN 2011-11-07 true 3128997000 2010 2016-02-24 21:20:13Z F SCOTT KELLMAN 1600 Division St Suite 700 Nashville TN 37219 50855466 false X N/A X 2002 TN THE ORGANIZATION OWNS AND OPERATES NURSING HOMES, SENIOR LIVING FACILITIES, ASSISTED LIVING FACILITIES AND RELATED FACILITIES, AND PROVIDES HEALTHCARE AND OTHER SERVICES TO THE ELDERLY AND INFIRM. 4 3 1583 225 0 0 10649 10140 34188450 50638367 67454 90410 44959 116549 34311512 50855466 30345 30300 0 0 17563673 26410526 0 0 0 15244665 22139792 32838683 48580618 1472829 2274848 48033374 52731147 43940700 46363625 4092674 6367522 X THE ORGANIZATION OWNS AND OPERATES NURSING HOMES, SENIOR LIVING FACILITIES, ASSISTED LIVING FACILITIES AND RELATED FACILITIES, AND PROVIDES HEALTHCARE AND OTHER SERVICES TO THE ELDERLY AND INFIRM THROUGHOUT THE UNITED STATES. false false 18137863 0 20131327 THE ORGANIZATION PROVIDES A VARIETY OF LONG-TERM NURSING SERVICES AT THREE LOCATIONS IN WISCONSIN. SERVICES INCLUDE COMPREHENSIVE NURSING CARE, THERAPIES, DIETARY SERVICES, SOCIAL SERVICES, AND RESIDENT ACTIVITIES. ALL OF THE FACILITIES ARE CERTIFIED FOR MEDICARE AND MEDICAID. COLONIAL CENTER IS A 95 BED NURSING FACILITY LOCATED IN COLBY, WISCONSIN. KARMENTA CENTER IS A 103 BED NURSING FACILITY IN MADISON, WISCONSIN. BETHEL CENTER IS A 111 BED NURSING FACILITY LOCATED IN ARPIN, WISCONSIN. 7902714 0 9496244 THE ORGANIZATION OPERATES A LICENSED NURSING HOME IN EAU CLAIRE, WISCONSIN. THE FACILITY PROVIDES CARE TO ELDERLY RESIDENTS, INCLUDING NURSING CARE, ANCILLARY SERVICES, SOCIAL SERVICES, AND OTHER SERVICES AS REQUIRED. THE FACILITY IS CERTIFIED FOR MEDICARE AND MEDICAID AND OPERATES WITH 161 BEDS. 6909829 0 8163007 THE ORGANIZATION PROVIDES A VARIETY OF SERVICES TO THE ELDERLY AT THREE LOCATIONS IN INDIANA. THE HOME PLACE OWNS AND OPERATES AN APARTMENT COMPLEX FOR THE ELDERLY AND IS LOCATED IN THE GREATER INDIANAPOLIS, INDIANA AREA. THE HOME PLACE CONTAINS 60 INDEPENDENT LIVING UNITS. SANDERS GLEN OWNS AND OPERATES AN APARTMENT COMPLEX FOR THE ELDERLY AND IS LOCATED IN THE GREATER INDIANAPOLIS, INDIANA AREA. SANDERS GLEN CONTAINS 143 LICENSED ASSISTED LIVING BEDS CONTAINED IN 111 UNITS. MORNING BREEZE OWNS AND OPERATES A CONTINUING CARE RETIREMENT COMMUNITY (CCRC) IN GREENSBURG, INDIANA. MORNING BREEZE CONTAINS 18 INDEPENDENT LIVING VILLA HOMES, 30 LICENSED ASSISTED LIVING BEDS CONTAINED IN 25 UNITS, AND A 48 BED HEALTHCARE CENTER. 9529077 30300 12864602 THE AMERICAN EAGLE PARENT COMPANY OWNS AND PROVIDES THIRD PARTY MANAGEMENT AND ADMINISTRATIVE SERVICES TO ITS FACILITY COMPANIES, WHICH ARE DISREGARDED ENTITIES OF THE PARENT COMPANY. THE ORGANIZATION OPERATES A LICENSED NURSING HOME IN WHITEHOUSE, TEXAS. THE OAKBROOK NURSING FACILITY (OAKBROOK) PROVIDES CARE TO ELDERLY RESIDENTS, INCLUDING NURSING CARE, ANCILLARY SERVICES, SOCIAL SERVICES, AND OTHER SERVICES AS REQUIRED. OAKBROOK OPERATES A 120 BED NURSING HOME. THE ORGANIZATION ALSO OPERATES A LICENSED NURSING HOME IN WEST ALLIS, WISCONSIN. THE ALLIS CARE CENTER PROVIDES CARE TO ELDERLY RESIDENTS, INCLUDING NURSING CARE, ANCILLARY SERVICES, SOCIAL SERVICES, AND OTHER SERVICES AS REQUIRED. THE FACILITY IS CERTIFIED FOR MEDICARE AND MEDICAID AND OPERATES WITH 152 BEDS. 9529077 30300 12864602 42479483 true false false false false false false true false true false false true false true false false false false false false false false false false false true false true true false false false false false false false false false false false false false false true false false false false false true X 139 0 true 1583 true false false false false false false false false false false X 4 3 false true false false false false false true true false true true true true true true true true true true true true X F Scott Kellman co John Gillmor 6152522305 1600 DIVISION STREET SUITE 700 NASHVILLE TN 37219 X RANDY RUTTA 2 X 24620 0 0 KENT SYVERUD 2 X 24620 0 0 MARK MILLER 3 X 24620 0 0 F SCOTT KELLMAN 40 X X 509800 0 6112 SUSAN LUND 40 X 107480 0 1807 691140 0 7919 1 false true false MEDICAL REHABILITATION CENTERS LLC 535 WEST SECOND STREET SUITE 105 LEXINGTON KY 40508 MANAGEMENT SERVICES 4534037 GENESIS REHABILITATION SERVICES 101 EAST STATE STREET KENNETT SQUARE PA 19348 THERAPY SERVICES 1811213 GREENFIELD REHABILITATION AGENCY INC 7517 W COLDSPRING ROAD GREENFIELD WI 53220 THERAPY SERVICES 888082 SELECT REHABILITATION INC PO BOX 809056 CHICAGO IL 60680 THERAPY SERVICES 691743 HEALTHCARE THERAPY SERVICES 1411 W COUNTY LINE ROAD GREENWOOD IN 46142 THERAPY SERVICES 390341 13 10140 10140 PATIENT SERVICE REVENUES 50638367 50638367 0 0 0 0 50638367 90410 90410 0 0 0 0 0 0 0 0 0 0 0 BEAUTY/BARBER SHOP 45316 45316 MEALS/VENDING 26651 26651 AIDES IN TRAINING/TRAINING REIMBURSEMENT 16813 16813 27769 0 0 27769 116549 50855466 50655180 0 190146 30300 30300 0 0 0 589772 589772 0 21956556 21924406 32150 8611 8611 1852970 1852970 2002617 2002617 2319156 1851844 467312 106564 106564 169360 169360 0 0 0 5427443 4488258 939185 277394 277394 4848146 3223139 1625007 89360 73771 15589 0 2206053 1971787 234266 146522 103494 43028 0 33347 33347 2435054 1770435 664619 0 2042563 1410560 632003 584667 402434 182233 REVENUE ASSESSMENT FEES 1168688 1168688 INDIGENT CARE/BAD DEBT 146904 146904 EMPLOYEE RECRUITMENT 62839 62839 DUES AND SUBSCRIPTIONS 44816 44816 MISCELLANEOUS 30916 15918 14998 0 0 0 0 48580618 42479483 6101135 0 0 1441330 7900 4782283 7368872 3157042 4785460 572627 474113 42881672 8329315 34752307 34552357 0 0 0 1526798 579994 3327785 3435653 48033374 52731147 3377000 5445633 25825000 22580000 66399 39820 14672301 18298172 0 0 43940700 46363625 X 4092674 6367522 4092674 6367522 48033374 52731147 2274848 0 X X true false true X false X 21588 0 0 10649 10140 42377 30967286 35564637 34596710 34188450 50638367 185955450 233902 105527 -254495 26343 88795 200072 0 0 31222776 35670164 34342215 34225442 50737302 186197899 0 0 0 0 0 0 0 0 186197899 224343 378668 80851 67454 90410 841726 0 224343 378668 80851 67454 90410 841726 0 0 0 0 18616 16813 35429 31447119 36048832 34423066 34311512 50844525 187075054 0.99530 0.99429 0.00450 0.00470 X SCHEDULE A, PART III, SECTION B, LINE 12, OTHER INCOME, MISCELLANEOUS INCOME RECEIVED IN FURTHERANCE OF THE ORGANIZATION'S TAX EXEMPT PURPOSE: 2006 ($0); 2007 ($0); 2008 ($0); 2009 ($18,616); 2010 ($16,813)., 0 0 0 true 84506 1264198 1253347 95357 true 2639900 2639900 33006458 4407784 28598674 306690 141849 164841 6879412 3779682 3099730 49212 49212 34552357 ORGANIZATION & ACQUISITION COSTS 67655 REPLACEMENT RESERVE 692978 DEFERRED FINANCING FEES, NET 1827663 DEPOSITS 838357 OTHER ASSETS 9000 3435653 0 0 Agent, trustee, custodian, or other intermediary arrangement Schedule D, Part IV, Line 1b SEE NARRATIVE FOR SCHEDULE D, PART IV, LINE 2B. Explanation of escrow agreement Schedule D, Part IV, Line 2b FOR PERSONAL PROTECTION, IT IS REQUESTED THAT MONEY NOT BE LEFT IN THE RESIDENTS' ROOMS. THE FACILITY MAY NOT REQUIRE RESIDENTS TO DEPOSIT THEIR PERSONAL FUNDS WITH THE FACILITY; HOWEVER, IF THE RESIDENT WISHES, AND UPON WRITTEN AUTHORIZATION OF A RESIDENT, THE FACILITY WILL WITHHOLD, SAFEGUARD, MANAGE, AND ACCOUNT FOR THE PERSONAL FUNDS OF THE RESIDENT DEPOSITED WITH THE FACILITY. ANY RESIDENT'S PERSONAL FUNDS IN EXCESS OF $50 ARE DEPOSITED IN AN INTEREST-BEARING ACCOUNT THAT IS SEPARATE FROM FACILITY FUNDS. THE FACILITY CREDITS ALL INTEREST EARNED ON THE RESIDENT'S FUNDS TO HIS OR HER ACCOUNT. A RESIDENT'S PERSONAL FUNDS THAT DO NOT EXCEED $50 ARE MAINTAINED IN A NON-INTEREST-BEARING ACCOUNT OR PETTY CASH FUND. THE FACILITY MAINTAINS A SYSTEM THAT ASSURES A COMPLETE AND SEPARATE ACCOUNTING OF EACH RESIDENT'S PERSONAL FUNDS ENTRUSTED TO THE FACILITY. THE FACILITY DEPOSITS THE PERSONAL NEEDS ALLOWANCE RETAINED BY ANY RESIDENT WHOSE CARE IS PAID FOR UNDER THE MEDICAID PROGRAM INTO THE RESIDENT'S ACCOUNT. THE FACILITY FURNISHES THE RESIDENT WITH A WRITTEN RECEIPT FOR ANY PERSONAL FUNDS OR PERSONAL PROPERTY RECEIVED BY THE FACILITY. RESIDENTS MAY ACCESS THEIR ACCOUNT DURING NORMAL BUSINESS HOURS; IF RESIDENTS NEED ACCESS TO THEIR MONEY AFTER HOURS OR DURING THE WEEKEND, THE BUSINESS OFFICE MANAGER OR ADMINISTRATOR IS CONTACTED AND ARRANGES FOR THE RESIDENTS TO RECEIVE THEIR FUNDS. THE INDIVIDUAL FINANCIAL RECORD IS AVAILABLE QUARTERLY ON REQUEST BY THE RESIDENT OR HIS OR HER LEGAL REPRESENTATIVE. AT LEAST EVERY THREE MONTHS, THE FACILITY FURNISHES THE RESIDENT OR THE RESIDENT'S REPRESENTATIVE WITH A COMPLETE STATEMENT OF ALL FUNDS AND OTHER PROPERTY HELD BY THE FACILITY, DETAILING THE AMOUNTS AND ITEMS RECEIVED, TOGETHER WITH THEIR SOURCES, DISPOSITION, AND THE DATE OF EACH TRANSACTION. FIN 48 (ASC 740) footnote Schedule D, Part X, Line 2 THE SIX WISCONSIN FACILITIES, THE THREE INDIANA FACILITIES, THE AE EAU CLAIRE FACILITY COMPANY, AND THE AE WHITEHOUSE FACILITY COMPANY RECEIVE AUDITED FINANCIAL STATEMENTS THAT EACH INCLUDE THE FOLLOWING FIN 48 FOOTNOTE: AS LIMITED LIABILITY COMPANIES, ALL INCOME IS INCLUDED IN THE TAXABLE INCOME OF THE INDIVIDUAL MEMBER; THUS, NO FEDERAL OR STATE INCOME TAXES ARE INCLUDED IN THESE COMBINED FINANCIAL STATEMENTS. U.S. GAAP REQUIRES THAT A TAX POSITION IS RECOGNIZED AS A BENEFIT ONLY IF IT IS "MORE LIKELY THAT NOT" THAT THE TAX POSITION WOULD BE SUSTAINED IN A TAX EXAMINATION, WITH A TAX EXAMINATION BEING PRESUMED TO OCCUR. THE AMOUNT RECOGNIZED IS THE LARGEST AMOUNT OF TAX BENEFIT THAT IS GREATER THAN 50% LIKELY OF BEING REALIZED ON EXAMINATION. FOR TAX POSITIONS NOT MEETING THE "MORE LIKELY THAN NOT" TEST, NO TAX BENEFIT IS RECORDED. THE GROUP RECOGNIZES INTEREST AND PENALTIES RELATED TO UNRECOGNIZED TAX BENEFITS IN INTEREST AND INCOME TAX EXPENSE, RESPECTIVELY. THE GROUP HAS NO AMOUNTS ACCRUED FOR INTEREST OR PENALTIES AS OF DECEMBER 31, 2010. THERE WERE NO TAX BENEFITS RECORDED FOR 2010 AND 2009. DUE TO ITS PASS-THROUGH STATUS, THE GROUP IS NOT SUBJECT TO U.S. FEDERAL INCOME TAX OR STATE INCOME TAX. AMERICAN EAGLE LIFECARE CORPORATION, INC.'S FORM 990 HAS NOT BEEN SUBJECT TO EXAMINATION FOR THE LAST THREE YEARS. THE GROUP DOES NOT EXPECT THE TOTAL AMOUNT OF UNRCOGNIZED TAX BENEFITS TO SIGNIFICANTLY CHANGE IN THE NEXT 12 MONTHS. true EMERSON SCHOOL INC 5425 SCIO CHURCH ROAD ANN ARBOR MI 48103 237442766 501(C)(3) 7500 0 N/A N/A TO SUPPORT GENERAL OPERATIONS 1 0 Procedures for monitoring use of grant funds Schedule I, Part I, Line 2 BOARD MEMBERS, OFFICERS, AND THE BOARD ADVISOR ARE ENCOURAGED TO SUBMIT RECOMMENDATIONS TO THE BOARD FOR CHARITABLE CONTRIBUTIONS TO SUPPORT OTHER WORTHY TAX EXEMPT ORGANIZATIONS ON AN ANNUAL BASIS. 2010 CHARITABLE DONATIONS FROM AMERICAN EAGLE TOTALED LESS THAN $35,000. CONTRIBUTIONS MADE ARE UNRESTRICTED AND CAN BE USED IN ANY WAY THE DONEE ORGANIZATION SEES FIT TO FURTHER THEIR EXEMPT PURPOSE. X X X X false false false false false false false false false F SCOTT KELLMAN 500222 0 0 0 9578 0 0 0 6112 0 515912 0 0 0 INDIANA HEALTH & EDUCATIONAL FACILITY FINANCING AUTHORITY 351611409 454795AE5 2005-12-02 11120000 AE LIFECARE PROJECT SERIES 2005A - FACILITY ACQUISITION, REPAIRS, AND REPLACEMENT EQUIPMENT false false false WISCONSIN HEALTH & EDUCATIONAL FACILITIES AUTHORITY 391337855 97710BBY7 2008-06-11 12000000 REFINANCE 11/01/2003 WISCONSIN BONDS FOR FACILITY ACQUISITION, ADDITIONS, AND IMPROVEMENTS false false false 290000 0 11120000 0 0 0 222400 0 0 10897600 0 0 2005 false false true true 250000 0 12000000 993271 0 0 0 0 0 2383148 0 0 2008 true false true true false false false false 0.0000 0.0000 0.0000 true false false false false 0.0000 0.0000 0.0000 true false true true WACHOVIA BANK NA 5.0 false true false NA false true false false false NA true PACKERKISS SECURITIES 7.0 true false true QUALIFIED HEDGE SCHEDULE K, PART IV, LINES 3A-E QUALIFIED HEDGE WITH RESECT TO THE 2005 INDIANA HEALTH & EDUCATIONAL FACILITY FINANCING AUTHORITY BOND ISSUE: IN DECEMBER 2005, THE ORGANIZATION PURCHASED A FIVE YEAR INTEREST RATE CAP (HEDGE) WITH WACHOVIA BANK NATIONAL ASSOCIATION. THIS INSTRUMENT "CAPPED" THE MAXIMUM INTEREST RATE EXPOSURE WITH RESPECT TO THE BONDS AT 9.25% PER ANNUM DURING THE FIVE YEAR TERM OF THE INTEREST RATE CAP (HEDGE). UPON EXPIRATION OF THE HEDGE IN DECEMBER 2010, THE ORGANIZATION PURCHASED AN INTEREST RATE CAP (HEDGE) WITH US BANK NATIONAL ASSOCIATION TO LIMIT INTEREST RATE EXPOSURE WITH RESPECT TO THE BONDS AT 6% FOR ONE ADDITIONAL YEAR. New program services Form 990, Part III, Line 2 THE ORGANIZATION ACQUIRED LEXINGTON HEALTHCARE, LLC IN JULY 2010; THESE ACTIVITIES ARE DESCRIBED IN PART III, LINE 4D. Description of other program services Form 990, Part III, Line 4d THE AMERICAN EAGLE PARENT COMPANY OWNS AND PROVIDES THIRD PARTY MANAGEMENT AND ADMINISTRATIVE SERVICES TO ITS FACILITY COMPANIES, WHICH ARE DISREGARDED ENTITIES OF THE PARENT COMPANY. THE ORGANIZATION OPERATES A LICENSED NURSING HOME IN WHITEHOUSE, TEXAS. THE OAKBROOK NURSING FACILITY (OAKBROOK) PROVIDES CARE TO ELDERLY RESIDENTS, INCLUDING NURSING CARE, ANCILLARY SERVICES, SOCIAL SERVICES, AND OTHER SERVICES AS REQUIRED. OAKBROOK OPERATES A 120 BED NURSING HOME. THE ORGANIZATION ALSO OPERATES A LICENSED NURSING HOME IN WEST ALLIS, WISCONSIN. THE ALLIS CARE CENTER PROVIDES CARE TO ELDERLY RESIDENTS, INCLUDING NURSING CARE, ANCILLARY SERVICES, SOCIAL SERVICES, AND OTHER SERVICES AS REQUIRED. THE FACILITY IS CERTIFIED FOR MEDICARE AND MEDICAID AND OPERATES WITH 152 BEDS. ANNUAL SUMMARY AND TRANSMITTAL OF U.S. INFORMATION RETURNS FORM 990, PART V, LINE 1A EACH OF THE DISREGARDED ENTITIES FILES A SEPARATE FORM 1096, AND THE NUMBER REPORTED IN BOX 3 OF EACH RESPECTIVE ENTITY IS AS FOLLOWS: AMERICAN EAGLE NURSING HOME COMPANY OF ARPIN, LLC (10); AMERICAN EAGLE NURSING HOME COMPANY OF COLBY, LLC (8); AMERICAN EAGLE NURSING HOME COMPANY OF MADISON, LLC (22); AMERICAN EAGLE NURSING HOME COMPANY OF EAU CLAIRE, LLC (34); AMERICAN EAGLE NURSING HOME COMPANY OF WHITEHOUSE, LLC (7); AMERICAN EAGLE GROUP - WISCONSIN (3); AMERICAN EAGLE GROUP - INDIANA (3); AMERICAN EAGLE HOME PLACE, LLC (2); AMERICAN EAGLE SANDERS GLEN, LLC (8); AMERICAN EAGLE MORNING BREEZE, LLC (15); LEXINGTON HEALTHCARE, LLC (20); AMERICAN EAGLE LIFECARE CORPORATION (7). TRANSMITTAL OF WAGE AND TAX STATEMENTS FORM 990, PART V, LINE 2A EACH OF THE DISREGARDED ENTITIES FILES A SEPARATE FORM W-3, AND THE NUMBER REPORTED FOR EACH RESPECTIVE ENTITY IS AS FOLLOWS: AMERICAN EAGLE NURSING HOME COMPANY OF ARPIN, LLC (185); AMERICAN EAGLE NURSING HOME COMPANY OF COLBY, LLC (178); AMERICAN EAGLE NURSING HOME COMPANY OF MADISON, LLC (207); AMERICAN EAGLE NURSING HOME COMPANY OF EAU CLAIRE, LLC (304); AMERICAN EAGLE NURSING HOME COMPANY OF WHITEHOUSE, LLC (274); AMERICAN EAGLE HOME PLACE, LLC (3); AMERICAN EAGLE SANDERS GLEN, LLC (74); AMERICAN EAGLE MORNING BREEZE, LLC (111); LEXINGTON HEALTHCARE, LLC (246); AND AMERICAN EAGLE LIFECARE CORPORATION (1). Delegation of management duties Form 990, Part VI, Section A, Line 3 IN JULY 2010, THE ORGANIZATION ENTERED INTO A MANAGEMENT AGREEMENT FOR LEXINGTON HEALTHCARE WITH MEDICAL REHABILITATION CENTERS, LLC, A KENTUCKY CORPORATION, FOR A TERM OF 15 YEARS, TO PROVIDE SUBSTANTIALLY ALL MANAGEMENT SERVICES FOR THE FACILITY FOR AN INITIAL MONTHLY FEE OF $41,666 PLUS PAYROLL COSTS OF EMPLOYEES OR CONSULTANTS OF THE FACILITY WHO ARE EMPLOYEES OF THE MANAGER. THE INITIAL MONTHLY FEE WILL BE ADJUSTED ANNUALLY BASED ON AN ANNUAL CHANGE IN THE CONSUMER PRICE INDEX. IN JANUARY 2010, THE ORGANIZATION ENTERED INTO A MANAGEMENT AGREEMENT FOR THE CLAIREMONT NURSING AND REHABILITATION CENTER WITH MEDICAL REHABILITATION CENTERS, LLC, A KENTUCKY CORPORATION, FOR A TERM OF 15 YEARS, TO PROVIDE SUBSTANTIALLY ALL MANAGEMENT SERVICES FOR THE FACILITY FOR AN INITIAL MONTHLY FEE OF $41,600 PLUS PAYROLL COSTS OF EMPLOYEES OR CONSULTANTS OF THE FACILITY WHO ARE EMPLOYEES OF THE MANAGER. THE INITIAL MONTHLY FEE WILL BE ADJUSTED ANNUALLY BASED ON AN ANNUAL CHANGE IN THE CONSUMER PRICE INDEX. IN DECEMBER 2005, THE ORGANIZATION ENTERED INTO MANAGEMENT AGREEMENTS FOR EACH OF THE THREE INDIANA FACILITIES (THE HOME PLACE, SANDERS GLEN, AND MORNING BREEZE) WITH MEDICAL REHABILITATION CENTERS, INC., A KENTUCKY CORPORATION, FOR A TERM OF 15 YEARS, TO PROVIDE SUBSTANTIALLY ALL MANAGEMENT SERVICES FOR EACH FACILITY FOR AN INITIAL MONTHLY FEE OF $17,000 PLUS PAYROLL COSTS OF EMPLOYEES OR CONSULTANTS OF THE THREE FACILITIES WHO ARE EMPLOYEES OF THE MANAGER. THE INITIAL MONTHLY FEE HAS BEEN ADJUSTED ANNUALLY BASED ON AN ANNUAL CHANGE IN THE CONSUMER PRICE INDEX. IN NOVEMBER 2003 AND AMENDED AND RESTATED AS OF JUNE 1, 2008, EACH OF THE THREE WISCONSIN FACILITIES (COLONIAL, KARMENTA, AND BETHEL) ENTERED INTO A MANAGEMENT AGREEMENT WITH MEDICAL REHABILITATION CENTERS, INC., A KENTUCKY CORPORATION, FOR A TERM OF 15 YEARS, TO PROVIDE SUBSTANTIALLY ALL MANAGEMENT SERVICES FOR EACH FACILITY FOR AN INITIAL MONTHLY FEE OF $77,500 PLUS PAYROLL COSTS OF EMPLOYEES AND CONSULTANTS OF THE THREE FACILITIES WHO ARE EMPLOYEES OF THE MANAGER. THE INITIAL MONTHLY FEE HAS BEEN ADJUSTED ANNUALLY BASED ON AN ANNUAL CHANGE IN THE CONSUMER PRICE INDEX. IN SEPTEMBER 2005, THE OAKBROOK HEALTH CARE FACILITY ENTERED INTO A MANAGEMENT AGREEMENT WITH ATRIUM LIVING CENTERS OF TEXAS, INC. FOR A TERM OF NINE YEARS AND FOUR MONTHS. UNDER THE AGREEMENT, ATRIUM IS TO EXCLUSIVELY SUPERVISE, DIRECT, AND CONTROL THE MANAGEMENT AND OPERATION OF THE FACILITY FOR A MONTHLY FEE OF $22,000. Review of form 990 by governing body Form 990, Part VI, Section B, Line 11b A BOARD MEETING IS HELD (OCTOBER 2011) WHERE A COPY OF THE FULL FORM 990, INCLUDING ALL APPLICABLE SCHEDULES, IS PROVIDED TO EACH MEMBER OF THE GOVERNING BODY BEFORE THE RETURN IS FILED WITH THE IRS. Conflict of interest policy Form 990, Part VI, Section B, Line 12c ANNUAL CERTIFICATIONS ARE RECEIVED FROM ALL OFFICERS AND DIRECTORS TO DETERMINE WHETHER ANY POTENTIAL CONFLICTS OF INTEREST EXIST. THE BOARD OF DIRECTORS DISCUSS THE ANNUAL CERTIFICATIONS AT THE BOARD MEETINGS TO DETERMINE WHETHER AN ACTUAL CONFLICT OF INTEREST EXISTS. IF A CONFLICT IS DETERMINED TO EXIST, THAT PERSON WOULD BE RECUSED FROM TAKING PART IN ANY DECISIONS CONCERNING THE CONFLICTING ISSUE. Process used to establish compensation of top management official Form 990, Part VI, Section B, Line 15a THE ORGANIZATION'S BOARD OF DIRECTORS REVIEWED AND APPROVED THE COMPENSATION FOR THE ORGANIZATION'S PRESIDENT AND CEO, F. SCOTT KELLMAN. THE BOARD OF DIRECTORS OBTAINED COMPENSATION STUDIES PERFORMED BY THE REZNICK GROUP, L.C. IN JULY 2008, AND CROWE HORWATH LLP IN SEPTEMBER 2010, TO USE IN DETERMINING THE AMOUNT OF COMPENSATION FOR 2008 THROUGH 2010. THIS INFORMATION WAS DOCUMENTED IN THE BOARD MEETING MINUTES IN 2008 AND 2010 WHEN THE COMPENSATION STUDIES WERE REVIEWED. Process used to establish compensation of other officers/key employees Form 990, Part VI, Section B, Line 15b THE ORGANIZATION'S BOARD OF DIRECTORS REVIEWS AND APPROVES THE COMPENSATION FOR THE ORGANIZATION'S OTHER OFFICERS. THE BOARD OF DIRECTORS OBTAINED COMPENSATION STUDIES PERFORMED BY THE REZNICK GROUP, L.C. IN JULY 2008, AND CROWE HORWATH LLP IN SEPTEMBER 2010, TO USE IN DETERMINING THE AMOUNT OF COMPENSATION FOR 2008 THROUGH 2010. THE BOARD DISCUSSES THE COMPENSATION ANNUALLY AND COLLECTIVELY AGREES UPON COMPENSATION AMOUNTS FOR ALL OFFICERS. THIS INFORMATION IS DOCUMENTED IN THE BOARD MEETING MINUTES WHEN COMPENSATION IS REVIEWED. Public Disclosure Form 990, Part VI, Section C, Line 19 THE ORGANIZATION'S GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS ARE MADE AVAILABLE TO THE PUBLIC UPON REQUEST. OFFICERS, DIRECTORS, TRUSTEES, KEY EMPLOYEES, AND HIGHEST COMPENSATED EMPLOYEES FORM 990, PART VII, SECTION A, LINE 1A SUSAN LUND, REGISTERED NURSE, IS PAID BY LEXINGTON HEALTHCARE, LLC (EIN 20-1684547). AUDITED/COMPILED FINANCIAL STATEMENTS FORM 990, PART IV, LINES 12A-B AND PART XII, LINES 2A-B THE ORGANIZATION RECEIVES FOUR SEPARATE SETS OF AUDITED FINANCIAL STATEMENTS, EACH OF WHICH IS PREPARED IN ACCORDANCE WITH GAAP. THE FINANCIAL INFORMATION IS THEN COMBINED FOR PURPOSES OF THE FORM 990. ONE SET OF AUDITED FINANCIAL STATEMENTS, WHICH IS PREPARED ON A CONSOLIDATED BASIS, CONSISTS OF THE FOLLOWING INDIANA ENTITIES: AMERICAN EAGLE HOME PLACE, LLC (EIN 20-3295047); AMERICAN EAGLE MORNING BREEZE, LLC (EIN 20-3294992); AND AMERICAN EAGLE SANDERS GLEN, LLC (EIN 20-3294905). A SECOND SET OF AUDITED FINANCIAL STATEMENTS, WHICH IS PREPARED ON A CONSOLIDATED BASIS, CONSISTS OF THE FOLLOWING WISCONSIN ENTITIES: AE ARPIN FACILITY COMPANY, LLC (EIN 81-0621902); AMERICAN EAGLE NURSING HOME COMPANY OF ARPIN, LLC (EIN 47-0924079); AE COLBY FACILITY COMPANY, LLC (EIN 81-0622276); AMERICAN EAGLE NURSING HOME COMPANY OF COLBY, LLC (EIN 68-0558136); AE MADISON FACILITY COMPANY , LLC (EIN 26-0070115); AND AMERICAN EAGLE NURSING HOME COMPANY OF MADISON, LLC (EIN 81-0621853). A THIRD SET OF AUDITED FINANCIAL STATEMENTS CONSISTS OF THE AE WHITEHOUSE FACILITY COMPANY, LLC (EIN 20-2818309). THE FINANCIAL INFORMATION FOR AMERICAN EAGLE NURSING HOME COMPANY OF WHITEHOUSE, LLC (EIN 20-2818234), WHICH OPERATES THE OAKBROOK HEALTH CENTER, DOES NOT RECEIVE AUDITED FINANCIAL STATEMENTS, BUT ITS FINANCIAL INFORMATION IS INCLUDED IN THE FORM 990. A FOURTH SET OF AUDITED FINANCIAL STATEMENTS CONSISTS OF THE AE EAU CLAIRE FACILITY COMPANY, LLC (EIN: 26-3709653). THE AMERICAN EAGLE NURSING HOME COMPANY OF EAU CLAIRE, LLC (EIN: 26-3709759) DOES NOT RECEIVE AUDITED FINANCIAL STATEMENTS, BUT ITS FINANCIAL INFORMATION IS INCLUDED IN THE FORM 990. LEXINGTON HEALTHCARE, LLC (EIN: 20-1684547) AND THE AMERICAN EAGLE LIFECARE CORPORATION PARENT COMPANY DO NOT RECEIVE AUDITED FINANCIAL STATEMENTS, BUT THE ANNUAL ACTIVITIES ARE ALSO INCLUDED IN THE FORM 990. THE FINANCIAL INFORMATION FOR EACH OF THE ABOVE ENTITIES IS ALSO INCLUDED IN A SINGLE FINANCIAL STATEMENT COMPILATION PREPARED BY THE ORGANIZATION'S INDEPENDENT AUDITORS. AE ARPIN FACILITY COMPANY LLC 8014 BETHEL ROAD ARPIN WI 54410 810621902 FACILITY COMPANY WI 412898 3133342 NA AMERICAN EAGLE NURSING HOME COMPANY OF ARPIN LLC 8014 BETHEL ROAD ARPIN WI 54410 470924079 NURSING HOME WI 6669482 1124682 NA AE COLBY FACILITY COMPANY LLC 702 WEST DOLF STREET COLBY WI 54421 810622276 FACILITY COMPANY WI 415357 2799946 NA AMERICAN EAGLE NURSING HOME COMPANY OF COLBY LLC 702 WEST DOLF STREET COLBY WI 54421 680558136 NURSING HOME WI 5292496 646330 NA AE MADISON FACILITY COMPANY LLC 4502 MILWAUKEE STREET MADISON WI 53714 260070115 FACILITY COMPANY WI 676059 5479769 NA AMERICAN EAGLE NURSING HOME COMPANY OF MADISON LLC 4502 MILWAUKEE STREET MADISON WI 53714 810621853 NURSING HOME WI 7842574 2015485 NA AE WHITEHOUSE FACILITY COMPANY LLC 107 STACEY DRIVE WHITEHOUSE TX 75791 202818309 FACILITY COMPANY TX 330471 3239896 NA AMERICAN EAGLE NURSING HOME COMPANY OF WHITEHOUSE LLC 107 STACEY DRIVE WHITEHOUSE TX 75791 202818234 NURSING HOME TX 7277926 1971759 NA AMERICAN EAGLE HOME PLACE LLC 6734 MILLSIDE DRIVE INDIANAPOLIS IN 46221 203295047 INDEPENDENT LIVING FACILITY IN 588868 2262505 NA AMERICAN EAGLE SANDERS GLEN LLC 320 NORTH MERIDIAN STREET INDIANAPOLIS IN 46204 203294905 INDEPENDENT LIVING FACILITY IN 2374116 5783070 NA AMERICAN EAGLE MORNING BREEZE LLC 320 NORTH MERIDIAN STREET INDIANAPOLIS IN 46204 203294992 CONTINUING CARE RETIREMENT COMMUNITY IN 5099227 8951824 NA AE EAU CLAIRE FACILITY COMPANY LLC 3819 HAWK CREST ANN ARBOR MI 48103 263709653 FACILITY COMPANY MI 744372 9238566 NA AMERICAN EAGLE NURSING HOME COMPANY OF EAU CLAIRE LLC 2120 HEIGHTS DRIVE EAU CLAIRE WI 54701 263709759 NURSING HOME WI 9507187 2604233 NA LEXINGTON HEALTHCARE LLC 9047 W GREENFIELD AVENUE WEST ALLIS WI 53214 201684547 NURSING HOME WI 5604125 2644069 NA