Common stock offered by us

Exhibit 10.59

[Fishersville, Virginia]
[Floyd, Virginia]
[Independence, Virginia]
[Newport News, Virginia]
[Roanoke, Virginia]
[Staunton, Virginia]
[Williamsburg, Virginia]
[Windsor, Virginia]
[Woodstock, Virginia]

FIRST AMENDMENT TO AMENDED AND RESTATED MASTER LEASE

          This First Amendment to Amended and Restated Master Lease (“Amendment”) is dated as of July 9, 2004, by and among HCP VIRGINIA, INC., a Delaware corporation (“Landlord”), and GENERATION LEASING COMPANY II, LLC, a Virginia limited liability company, SP FISHERSVILLE, LLC, a Virginia limited liability company, SP GRAYSON, LLC, a Virginia limited liability company, SP KINGS DAUGHTERS, LLC, a Virginia limited liability company, SP NEWPORT NEWS, LLC, a Virginia limited liability company, SP WILLIAMSBURG, LLC, a Virginia limited liability company, SP WINDSOR, LLC, a Virginia limited liability company, TANDEM HEALTH CARE OF FLOYD, LLC, a Delaware limited liability company, and TANDEM HEALTH CARE OF WOODSTOCK, LLC, a Delaware limited liability company (hereinafter collectively and jointly and severally referred to as “Tenant”).

RECITALS

          A. Landlord and Tenant entered into an Amended and Restated Master Lease dated as of April 30, 2004 (the “Lease”), for certain skilled nursing facilities located in the Commonwealth of Virginia and more particularly described therein.

          B. Tandem Health Care, Inc., a Pennsylvania corporation (“Guarantor”), has guaranteed Tenant’s obligations under the Lease pursuant to a written guaranty in favor of Landlord (as the same may have been amended, modified, supplemented or reaffirmed from time to time, the “Guaranty”).

          C. Landlord and Tenant desire to memorialize their understanding regarding certain provisions of the Lease.

AGREEMENT

          Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Lease. Landlord and Tenant hereby agree as follows:

          1. Effective Date. The Effective Date of the Lease with respect to (a) the Floyd Facility, the Fishersville Facility, the Newport News Facility, the Roanoke Facility, the Staunton Facility, the Williamsburg Facility, and the Woodstock Facility is April 30, 2004 and (b) the Independence Facility and the Windsor Facility is June 1, 2004.

          2. Term. The initial term of the Lease shall end on March 31, 2009.

          3. Lease Year. The first Lease Year for each Facility shall end on March 31, 2005.

          4. Full Force and Effect; Counterparts. Except as amended above, the Lease between Landlord and Tenant shall remain in full force and effect. This Amendment may be executed in any number of counterparts, all of which together shall constitute one and the same instrument.

[Signature Page Follows]

          IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the day and year first above written.

		LANDLORD:
		HCP VIRGINIA, INC.,
		a Delaware corporation
		By:		/s/ Edward J. Henning
		Name:		Edward J. Henning
		Title:		Senior Vice President

		TENANT:
		GENERATION LEASING COMPANY II, LLC,
		a Virginia limited liability company
		By:		Tandem Health Care of Virginia, LLC,
				Member
				By:		Tandem Health Care, Inc., its Member
						By: /s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO
		SP FISHERSVILLE, LLC, a Virginia limited
		liability company
		By:		Tandem Health Care of Virginia, LLC,
				Member
				By:		Tandem Health Care, Inc., its Member
						By: /s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

		SP GRAYSON, LLC, a Virginia limited liability
		company
		By:		Tandem Health Care of Virginia, LLC,
				Member
				By:		Tandem Health Care, Inc., its Member
						By: /s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

		SP KINGS DAUGHTERS, LLC, a Virginia limited
		liability company
		By:		Tandem Health Care of Virginia, LLC,
				Member
				By:		Tandem Health Care, Inc., its Member
						By:		/s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

		SP NEWPORT NEWS, LLC, a Virginia limited
		liability company
		By:		Tandem Health Care of Virginia, LLC,
				Member
				By:		Tandem Health Care, Inc., its Member
						By:		/s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

		SP WILLIAMSBURG, LLC, a Virginia limited
		liability company
		By:		Tandem Health Care of Virginia, LLC, Member
				By:		Tandem Health Care, Inc., its Member
						By:		/s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

		SP WINDSOR, LLC, a Virginia limited liability
		company,
		By:		Tandem Health Care of Virginia, LLC,
				Member
				By:		Tandem Health Care, Inc., its Member
						By:		/s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

		TANDEM HEALTH CARE OF FLOYD, LLC, a
		Delaware limited liability company
		By:		Tandem Health Care, Inc., Member
						By: /s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

		TANDEM HEALTH CARE OF WOODSTOCK,
		LLC, a Delaware limited liability company
		By:		Tandem Health Care, Inc., Member
						By:		/s/ Lawrence R. Deering
						Name: Lawrence R. Deering
						Title: Chairman and CEO

CONSENT, REAFFIRMATION AGREEMENT OF GUARANTOR

          The undersigned Guarantor hereby (i) reaffirms all of its obligations under the Guaranty, (ii) consents to the foregoing Amendment and (iii) agrees that its obligations under the Guaranty shall extend to Tenant’s duties, covenants and obligations pursuant to the Lease, as hereby amended.

		TANDEM HEALTH CARE, INC.,
		a Pennsylvania corporation
		By:		/s/ Lawrence R. Deering
		Name:		Lawrence R. Deering
		Its:		Chairman and CEO
		By:		/s/ Eugene R. Curcio
		Name:		Eugene R. Curcio
		Its:		Treasurer and CFO