Pre-Closing Date. Seller covenants that between the date hereof and the Closing Date, except as contemplated by this Agreement or with the consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed, Seller, the Corporation and the Partnership: (a) Will operate the Hospital and the Clinics only in the ordinary course and with due regard to the proper maintenance and repair of any real property or personal property associated therewith, ordinary wear and tear excepted; (b) Will take all reasonable action to preserve the goodwill and the present occupancy levels of the Hospital and the Clinics, it being understood and agreed that they shall not be required to undertake any action to preserve occupancy levels other than continuing to engage in the routine marketing activities in which they are currently engaged at the Hospital and the Clinics; (c) Except in conjunction with the Operations Restructuring, will not make any material change in the operation of the Hospital or the Clinics nor, except in the ordinary course of business, sell or agree to sell any items of machinery, equipment or other fixed assets of the Hospital, including but not limited to assets and equipment used in connection with the operation of the Hospital or the Clinics nor otherwise enter into any agreements materially affecting the Hospital or the Clinics; (d) Will use its reasonable efforts to retain the goodwill of the employees of, medical staff of or physicians under contract with, Seller, the Corporation and the Partnership, located at or connected with the operation of the Hospital and the Clinics and will provide Purchaser with notice in the event of any union organizing activities or contract negotiations are commenced after the date hereof; (e) Will not, except in the ordinary course of business, increase the compensation or bonuses payable or to become payable to any of the employees located at or connected with the operation of the Hospital or the Clinics, including employees located at the Seller's corporate or regional offices who work exclusively on matters related to the Hospital and the Clinics, or grant any severance benefits to any such employees other than to the extent such bonuses or severance payments impose no obligation on Purchaser after the Closing Date; (f) Will not enter into any written employment agreements in connection with the operation of the Hospital or the Clinics other than with physicians in the ordinary course of business; provided, however, that Seller shall provide Purchaser with copies of any such physician contracts; (g) Will not, except in the ordinary course of business, enter into any contract or commitment affecting any of the Seller's Assets, the Corporation's Assets or the Partnership's Assets or incur any additional indebtedness or amend, extend or renew any current debt instruments, whether in the ordinary course of business or otherwise, nor will Seller declare or pay any dividend or other distribution with respect to any of the Seller Assets nor pledge the accounts receivable of Seller as security for any indebtedness or lease agreements executed, amended or extended by Seller after the date hereof; provided, however, that nothing herein shall be construed as prohibiting (i) Seller or the Corporation from incurring inter-company indebtedness to Horizon and loaning the proceeds thereof to the Partnership or the Corporation or the Partnership from incurring such indebtedness, (ii) Horizon or the Seller from incurring debt, the proceeds of which may be made available to Seller, the Corporation or the Partnership or (iii) Seller, the Corporation or the Partnership from executing any and all documents necessary to amend any debt instruments under which Horizon may be the borrower and Seller, the Corporation or the Partnership a guarantor; (h) Will, during normal business hours, provide Purchaser and its agents and employees with access on twenty-four (24) hours notice to the books and records of Seller (with respect to the Hospital and the Clinics), the Corporation, the Partnership, the Hospital and the Clinics provided they do not interfere with the operation thereof; (i) Will operate the Hospital and the Clinics in substantial compliance with all applicable municipal, county, state and federal laws, regulations, ordinances, standards and orders as now in effect (including, without limitation, the building, zoning and life safety codes as currently applied with respect thereto) where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof; (j) Will take all reasonable action to achieve substantial compliance with any laws, regulations, ordinances, standards and orders applicable to the Hospital and the Clinics which are enacted or issued after execution of this Agreement and become effective or require compliance prior to the Closing where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof; (k) Will cause the Corporation's Assets and the Partnership's Assets to be maintained in substantially the same condition as they were in at the date hereof, ordinary wear and tear, casualty loss and taking by eminent domain excepted; (l) Will provide Purchaser with copies of the Corporation's and the Partnership's monthly financial statements prepared in the ordinary course of business; (m) Will provide Purchaser with copies of all licensure or certification surveys received by Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership and the related Plans of Correction prepared by Seller, the Corporation or the Partnership, as applicable; (n) Will cause the Partnership to pay as and when due the accounts payable which arise in the ordinary course of the business of the Hospital and the Clinics, except to the extent that the amount owing is being duly contested by Seller, the Corporation or the Partnership and such contest does not materially affect Seller, the Corporation, the Partnership, the Hospital or the Clinics; (o) Will maintain in force the existing insurance coverage with respect to the Hospital and the Clinics described in Exhibit 6.31; (p) Will file all returns, reports and filings of any kind or nature, or to secure timely extensions for the filing thereof, required to be filed by Seller (with respect to the Seller's Assets, the Hospital and the Clinics), the Corporation or the Partnership, including, but not limited to, state and federal tax returns and Medicare and Medicaid cost reports with respect to the Hospital and the Clinics and will timely pay all taxes or other obligations which are due and payable with respect thereto, except to the extent that the same are being duly contested in good faith in accordance with applicable law and such contest does not materially affect Seller's ability to fulfill its obligations under this Agreement or to consummate the transaction provided for herein or the Corporation, the Partnership, the Hospital or the Clinics; (q) Will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; and (r) Will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.27. (s) Unless specifically prohibited by law, Seller will use its best efforts to cause all of the conditions to Closing set forth in Paragraphs 12.01 and 12.02 which are within Seller's control to be satisfied prior to the Outside Closing Date and Seller will not take any action inconsistent with its obligations under this Agreement or which could hinder or delay the consummation of the transactions contemplated by this Agreement; (t) Neither Seller nor any of its officers, directors, advisors or others authorized to act on its behalf shall directly initiate or solicit discussions relating to any alternative acquisition proposal or similar transaction including, without limitation, a merger or other business combination involving Seller, any of the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets, or offer to acquire or convey in any manner, directly or indirectly, all or substantially all of the equity interests in, the voting securities of Seller, the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets; provided, however, that public announcements of the transaction contemplated by this Agreement shall not be prohibited hereby; (u) Will proceed with all due diligence to secure the Regulatory Approvals and Third Party Consents for which it is responsible under the terms hereof; (v) Will cooperate with Purchaser, at Purchaser's cost and expense, in any audits of the results of operations at the Hospital and/or the Clinics which Purchaser elects to conduct in order to comply with any requirements applicable to it under the federal securities laws; (w) Shall, within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected; and (x) Will take such action as may be necessary to ensure that the assets and the liabilities of the Corporation on the Closing Date exclude the following: (i) The Corporation's cash, cash equivalents and accounts receivable (the "Cash and Cash Equivalents"). (ii) Any claims which the Corporation may have against third parties relating to or arising from the acts or omissions of third parties prior to the Closing (the "Third Party Claims"). (iii) Any refunds to which the Corporation may now or hereafter be entitled relating to payments by or on behalf of the Corporation prior to the Closing including, without limitation, any federal, state, local or foreign taxes paid by the Corporation prior to the Closing Date (the "Refunds"). (iv) The bank accounts of the Corporation (the "Bank Accounts"). (v) The items owned by the Corporation and listed on Exhibit 9.02 (x)(v); (vi) All computer hardware and software relating to the wide area network of Horizon used by the Corporation or the Partnership for the operation of the general ledger and accounts payable software applications, which computer hardware and software is more fully described in Exhibit 9.02(x)(vi) (the "GL/AP Hardware and Software"); (vii) Subject to the provisions of Paragraph 9.03(e), the Corporation's rights and interests in and to proprietary materials, programs, manuals, promotional materials and other intangibles owned or developed by Seller and used by the Corporation or the Partnership in connection with the operations at the Hospital and/or the Clinics. (y) Will proceed with all due diligence to cause the Operations Restructuring to be completed as of the Closing Date pursuant to the terms of documents, including, but not limited to, the Assignment of the Hospital Lease, the Assignment of the Clinic Leases, the Hospital Sublease, the Clinic Subleases and the Amended Management Agreement, in form and substance reasonably acceptable to Seller and Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Regency Health Services Inc)
Pre-Closing Date. Seller covenants that between the date hereof and the Closing Date, except as contemplated by this Agreement or with the consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed, Seller, the Corporation and the Partnership:
(a) Will operate the Hospital and the Clinics only in the ordinary course and with due regard to the proper maintenance and repair of any real property or personal property associated therewith, ordinary wear and tear excepted;
(b) Will take all reasonable action to preserve the goodwill and the present occupancy levels of the Hospital and the ClinicsHospital, it being understood and agreed that they shall not be required to undertake any action to preserve occupancy levels other than continuing to engage in the routine marketing activities in which they are currently engaged at the Hospital and the ClinicsHospital;
(c) Except in conjunction with the Operations Restructuring, will not make any material change in the operation of the Hospital or the Clinics nor, except in the ordinary course of business, sell or agree to sell any items of machinery, equipment or other fixed assets of the Hospital, including but not limited to assets and equipment used in connection with the operation of the Hospital or the Clinics nor otherwise enter into any agreements materially affecting the Hospital or the ClinicsHospital;
(d) Will use its reasonable efforts to retain the goodwill of the employees of, medical staff of or physicians under contract with, Seller, the Corporation and the Partnership, located at or connected with the operation of the Hospital and the Clinics and will provide Purchaser with notice in the event of any union organizing activities or contract negotiations are commenced after the date hereof;
(e) Will not, except in the ordinary course of business, increase the compensation or bonuses payable or to become payable to any of the employees located at or connected with the operation of the Hospital or the ClinicsHospital, including employees located at the Seller's corporate or regional offices who work exclusively on matters related to the Hospital and the ClinicsHospital, or grant any severance benefits to any such employees other than to the extent such bonuses or severance payments impose no obligation on Purchaser after the Closing Date;
(f) Will not enter into any written employment agreements in connection with the operation of the Hospital or the Clinics other than with physicians in the ordinary course of business; provided, however, that Seller shall provide Purchaser with copies of any such physician contracts;
(g) Will not, except in the ordinary course of business, enter into any contract or commitment affecting any of the Seller's Assets, the Corporation's Assets or the Partnership's Assets or incur any additional indebtedness or amend, extend or renew any current debt instruments, whether in the ordinary course of business or otherwise, nor will Seller declare or pay any dividend or other distribution with respect to any of the Seller Assets nor pledge the accounts receivable of Seller as security for any indebtedness or lease agreements executed, amended or extended by Seller after the date hereof; provided, however, that nothing herein shall be construed as prohibiting (i) Seller or the Corporation from incurring inter-company indebtedness to Horizon and loaning the proceeds thereof to the Partnership or the Corporation or the Partnership from incurring such indebtedness, (ii) Horizon or the Seller from incurring debt, the proceeds of which may be made available to Seller, the Corporation or the Partnership or (iii) Seller, the Corporation or the Partnership from executing any and all documents necessary to amend any debt instruments under which Horizon may be the borrower and Seller, the Corporation or the Partnership a guarantor;
(h) Will, during normal business hours, provide Purchaser and its agents and employees with access on twenty-four (24) hours notice to the books and records of Seller (with respect to the Hospital and the ClinicsHospital), the Corporation, the Partnership, the Hospital and the Clinics provided they do not interfere with the operation thereof;
(i) Will operate the Hospital and the Clinics in substantial compliance with all applicable municipal, county, state and federal laws, regulations, ordinances, standards and orders as now in effect (including, without limitation, the building, zoning and life safety codes as currently applied with respect thereto) where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(j) Will take all reasonable action to achieve substantial compliance with any laws, regulations, ordinances, standards and orders applicable to the Hospital and the Clinics which are enacted or issued after execution of this Agreement and become effective or require compliance prior to the Closing where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(k) Will cause the Corporation's Assets and the Partnership's Assets to be maintained in substantially the same condition as they were in at the date hereof, ordinary wear and tear, casualty loss and taking by eminent domain excepted;
(l) Will provide Purchaser with copies of the Corporation's and the Partnership's monthly financial statements prepared in the ordinary course of business;
(m) Will provide Purchaser with copies of all licensure or certification surveys received by Seller (with respect to the Hospital and the ClinicsHospital), the Corporation or the Partnership and the related Plans of Correction prepared by Seller, the Corporation or the Partnership, as applicable;
(n) Will cause the Partnership to pay as and when due the accounts payable which arise in the ordinary course of the business of the Hospital and the ClinicsHospital, except to the extent that the amount owing is being duly contested by Seller, the Corporation or the Partnership and such contest does not materially affect Seller, the Corporation, the Partnership, the Hospital or the ClinicsHospital;
(o) Will maintain in force the existing insurance coverage with respect to the Hospital and the Clinics described in Exhibit 6.31;
(p) Will file all returns, reports and filings of any kind or nature, or to secure timely extensions for the filing thereof, required to be filed by Seller (with respect to the Seller's Assets, the Hospital and the ClinicsHospital), the Corporation or the Partnership, including, but not limited to, state and federal tax returns and Medicare and Medicaid cost reports with respect to the Hospital and the Clinics and will timely pay all taxes or other obligations which are due and payable with respect thereto, except to the extent that the same are being duly contested in good faith in accordance with applicable law and such contest does not materially affect Seller's ability to fulfill its obligations under this Agreement or to consummate the transaction provided for herein or the Corporation, the Partnership, the Hospital or the ClinicsHospital;
(q) Will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller (with respect to the Hospital and the ClinicsHospital), the Corporation or the Partnership after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; and
(r) Will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.27.
(s) Unless specifically prohibited by law, Seller will use its best efforts to cause all of the conditions to Closing set forth in Paragraphs 12.01 and 12.02 which are within Seller's control to be satisfied prior to the Outside Closing Date and Seller will not take any action inconsistent with its obligations under this Agreement or which could hinder or delay the consummation of the transactions contemplated by this Agreement;
(t) Neither Seller nor any of its officers, directors, advisors or others authorized to act on its behalf shall directly initiate or solicit discussions relating to any alternative acquisition proposal or similar transaction including, without limitation, a merger or other business combination involving Seller, any of the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets, or offer to acquire or convey in any manner, directly or indirectly, all or substantially all of the equity interests in, the voting securities of Seller, the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets; provided, however, that public announcements of the transaction contemplated by this Agreement shall not be prohibited hereby; (u) Will proceed with all due diligence to secure the Regulatory Approvals and Third Party Consents for which it is responsible under the terms hereof;
(v) Will cooperate with Purchaser, at Purchaser's cost and expense, in any audits of the results of operations at the Hospital and/or the Clinics which Purchaser elects to conduct in order to comply with any requirements applicable to it under the federal securities laws;
(w) Shall, within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected; and
(x) Will take such action as may be necessary to ensure that the assets and the liabilities of the Corporation on the Closing Date exclude the following:
(i) The Corporation's cash, cash equivalents and accounts receivable (the "Cash and Cash Equivalents").
(ii) Any claims which the Corporation may have against third parties relating to or arising from the acts or omissions of third parties prior to the Closing (the "Third Party Claims").
(iii) Any refunds to which the Corporation may now or hereafter be entitled relating to payments by or on behalf of the Corporation prior to the Closing including, without limitation, any federal, state, local or foreign taxes paid by the Corporation prior to the Closing Date (the "Refunds").
(iv) The bank accounts of the Corporation (the "Bank Accounts").
(v) The items owned by the Corporation and listed on Exhibit 9.02 (x)(v);
; (vi) All computer hardware and software relating to the wide area network of Horizon used by the Corporation or the Partnership for the operation of the general ledger and accounts payable software applications, which computer hardware and software is more fully described in Exhibit 9.02(x)(vi) (the "GL/AP Hardware and Software");
(vii) Subject to the provisions of Paragraph 9.03(e), the Corporation's rights and interests in and to proprietary materials, programs, manuals, promotional materials and other intangibles owned or developed by Seller and used by the Corporation or the Partnership in connection with the operations at the Hospital and/or the Clinics.
(y) Will proceed with all due diligence to cause the Operations Restructuring to be completed as of the Closing Date pursuant to the terms of documents, including, but not limited to, the Assignment of the Hospital Lease, the Assignment of the Clinic Leases, the Hospital Sublease, the Clinic Subleases and the Amended Management Agreement, in form and substance reasonably acceptable to Seller and Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Regency Health Services Inc)
Pre-Closing Date. Seller covenants that between the date hereof and the Closing Date, except as contemplated by this Agreement or with the consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed, Seller, the Corporation and the Partnership:
(a) Will Seller will operate the Hospital Hospital, the MOB and the Clinics only in the ordinary course and with due regard to the proper maintenance and repair of any real property or personal property associated therewith, ordinary wear and tear excepted, other than those repairs for which Purchaser has agreed to be responsible under Paragraph 4.15;
(b) Will Seller will take all reasonable action to preserve the goodwill and the present occupancy levels of the Hospital and the Clinics, it being understood and agreed that they Seller shall not be required to undertake any action to preserve occupancy levels other than continuing to engage in the routine marketing activities in which they are it is currently engaged at the Hospital and the Clinics;
(c) Except in conjunction with the Operations Restructuring, Seller will not make any material change in the operation of the Hospital or the Clinics nor, except in the ordinary course of business, sell or agree to sell any items of machinery, equipment or other fixed assets of the Hospital, including but not limited to assets and equipment used in connection with the operation of the Hospital and located at the MOB, or the Clinics nor otherwise enter into any agreements materially affecting the Hospital or the Clinics;
(d) Will Seller will use its reasonable efforts to retain the goodwill of the employees of, medical staff of or physicians under contract with, Seller, the Corporation and the Partnership, Seller located at or connected with the operation of the Hospital and the Clinics and will provide Purchaser with notice in the event of any union organizing activities or contract negotiations are commenced after the date hereof;
(e) Will not, except Except in the ordinary course of business, Seller will not increase the compensation or bonuses payable or to become payable to any of the its employees located at or connected with the operation of the Hospital or the Clinics, including employees located at the Seller's corporate or regional offices who work exclusively on matters related to the Hospital and the Clinics, or grant any severance benefits to any such employees other than to the extent such bonuses or severance payments impose no obligation on Purchaser after the Closing Date;
(f) Will Seller will not enter into any written employment agreements in connection with the operation of the Hospital or the Clinics other than with physicians in the ordinary course of business; provided, however, that Seller shall provide Purchaser with copies of any such physician contracts;
(g) Will Seller will not, except in the ordinary course of business, enter into any contract or commitment affecting any of the Seller's Assets, the Corporation's Assets or the Partnership's Assets or incur any additional indebtedness or amend, extend or renew any current debt instruments, whether in the ordinary course of business or otherwise, nor will Seller declare or pay any dividend or other distribution with respect to any of the Seller Assets nor pledge the accounts receivable of Seller as security for any indebtedness or lease agreements executed, amended or extended by Seller after the date hereof; provided, however, that nothing herein shall be construed as prohibiting (i) Seller or the Corporation from incurring inter-company indebtedness to Horizon and loaning the proceeds thereof to the Partnership or the Corporation or the Partnership from incurring such indebtednessand/or CMS, (ii) Horizon or the Seller and/or CMS from incurring debt, the proceeds of which may be made available to Seller, the Corporation or the Partnership Seller or (iii) Seller, the Corporation or the Partnership Seller from executing any and all documents necessary to amend any debt instruments under which Horizon and/or CMS may be the borrower and Seller, the Corporation or the Partnership Seller a guarantor;
(h) Will, during During normal business hours, Seller will provide Purchaser and its agents and employees with access on twenty-four (24) hours notice to the books and records of Seller (with respect to the Hospital and the Clinics)Hospital, including, but not limited to any books or records located in the CorporationMOB, the Partnership, the Hospital and the Clinics provided they do not interfere with the operation thereof;
(i) Will Seller will operate the Hospital and the Clinics in substantial compliance with all applicable municipal, county, state and federal laws, regulations, ordinances, standards and orders as now in effect (including, without limitation, the building, zoning and life safety codes as currently applied with respect thereto) where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(j) Will Seller will take all reasonable action to achieve substantial compliance with any laws, regulations, ordinances, standards and orders applicable to the Hospital Hospital, the MOB and the Clinics which are enacted or issued after execution of this Agreement and become effective or require compliance prior to the Closing where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(k) Will cause Seller will maintain the CorporationSeller's Assets and the Partnership's Assets to be maintained in substantially the same condition as they were in at the date hereof, ordinary wear and tear, casualty loss and taking by eminent domain excepted;
(l) Will Seller will provide Purchaser with copies of the Corporation's and the Partnership's its monthly financial statements prepared in the ordinary course of business;
(m) Will Seller will provide Purchaser with copies of all licensure or certification surveys received by Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership and the related Plans of Correction prepared by Seller, the Corporation or the Partnership, as applicable;
(n) Will cause the Partnership to Seller will pay as and when due the accounts payable which arise in the ordinary course of the business of the Hospital and the Clinicsbusiness, except to the extent that the amount owing is being duly contested by Seller, the Corporation or the Partnership Seller and such contest does not materially affect Seller, the Corporation, the Partnership, Seller or the Hospital or the Clinics;
(o) Will Within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, Seller shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected;
(p) Seller will maintain in force the existing insurance coverage with respect to the Hospital Hospital, the MOB and the Clinics described in Exhibit 6.316.28;
(pq) Will Seller will file all returns, reports and filings of any kind or nature, or to secure timely extensions for the filing thereof, required to be filed by Seller (with respect to the Seller's Assets, the Hospital and the Clinics), the Corporation or the Partnership, including, but not limited to, state and federal tax returns and Medicare and Medicaid cost reports with respect to the Hospital and the Clinics and will timely pay all taxes or other obligations which are due and payable with respect thereto, except to the extent that the same are being duly contested in good faith in accordance with applicable law and such contest does not materially affect Seller's ability to fulfill its obligations under this Agreement or to consummate the transaction provided for herein Seller or the Corporation, the Partnership, the Hospital or and the Clinics;
(q) Will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; and
(r) Will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.27.
(s) Unless specifically prohibited by law, Seller will use its best efforts to cause all of the conditions to Closing set forth in Paragraphs 12.01 and 12.02 which are within Seller's control to be satisfied prior to the Outside Closing Date and Seller will not take any action inconsistent with its obligations under this Agreement or which could hinder or delay the consummation of the transactions contemplated by this Agreement;
(ts) Neither Seller nor any of its officers, directors, advisors or others authorized to act on its behalf shall directly initiate or solicit discussions relating to any alternative acquisition proposal or similar transaction including, without limitation, a merger or other business combination involving Seller, Seller or any of the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets, or offer to acquire or convey in any manner, directly or indirectly, all or substantially all of the equity interests in, the voting securities of Seller, Seller or the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets; provided, however, that public announcements of the transaction contemplated by this Agreement shall not be prohibited hereby; ;
(t) Seller will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000;
(u) Will Seller will proceed with all due diligence to secure the Regulatory Approvals and Third Party Consents for which it is responsible under the terms hereof;
(v) Will Seller will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.24; and
(w) Seller will cooperate with Purchaser, at Purchaser's cost and expense, in any audits of the results of operations at the Hospital and/or the Clinics which Purchaser elects to conduct in order to comply with any requirements applicable to it under the federal securities laws;
(w) Shall, within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected; and
(x) Will take such action as may be necessary to ensure that the assets and the liabilities of the Corporation on the Closing Date exclude the following:
(i) The Corporation's cash, cash equivalents and accounts receivable (the "Cash and Cash Equivalents").
(ii) Any claims which the Corporation may have against third parties relating to or arising from the acts or omissions of third parties prior to the Closing (the "Third Party Claims").
(iii) Any refunds to which the Corporation may now or hereafter be entitled relating to payments by or on behalf of the Corporation prior to the Closing including, without limitation, any federal, state, local or foreign taxes paid by the Corporation prior to the Closing Date (the "Refunds").
(iv) The bank accounts of the Corporation (the "Bank Accounts").
(v) The items owned by the Corporation and listed on Exhibit 9.02 (x)(v);
(vi) All computer hardware and software relating to the wide area network of Horizon used by the Corporation or the Partnership for the operation of the general ledger and accounts payable software applications, which computer hardware and software is more fully described in Exhibit 9.02(x)(vi) (the "GL/AP Hardware and Software");
(vii) Subject to the provisions of Paragraph 9.03(e), the Corporation's rights and interests in and to proprietary materials, programs, manuals, promotional materials and other intangibles owned or developed by Seller and used by the Corporation or the Partnership in connection with the operations at the Hospital and/or the Clinics.
(y) Will proceed with all due diligence to cause the Operations Restructuring to be completed as of the Closing Date pursuant to the terms of documents, including, but not limited to, the Assignment of the Hospital Lease, the Assignment of the Clinic Leases, the Hospital Sublease, the Clinic Subleases and the Amended Management Agreement, in form and substance reasonably acceptable to Seller and Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Regency Health Services Inc)
Pre-Closing Date. Seller covenants that between the date hereof and the Closing Date, except as contemplated by this Agreement or with the consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed, Seller, the Corporation and the Partnership:
(a) Will operate Seller will enforce the obligations of SDRLP under the Hospital Lease, including but not limited to, any obligations which require SDRLP to fulfill any obligations imposed on Seller under the Ground Sublease and the Clinics only in the ordinary course and with due regard to the proper maintenance and repair of any real property or personal property associated therewith, ordinary wear and tear excepted;Parking Agreement.
(b) Will take all reasonable action to preserve the goodwill and the present occupancy levels of the Hospital and the Clinics, it being understood and agreed that they shall not be required to undertake any action to preserve occupancy levels other than continuing to engage in the routine marketing activities in which they are currently engaged at the Hospital and the Clinics;
(c) Except in conjunction with the Operations Restructuring, Seller will not make any material change in the operation of the Hospital or the Clinics nor, except in the ordinary course of business, sell or agree to sell any items of machinery, equipment or other fixed assets of the Hospital, including but not limited to assets and equipment used in connection with the operation of the Hospital or the Clinics Condominium Unit nor otherwise enter into any agreements materially affecting the Hospital or the ClinicsCondominium Unit;
(dc) Will use its reasonable efforts to retain the goodwill of the employees of, medical staff of or physicians under contract with, Seller, the Corporation and the Partnership, located at or connected with the operation of the Hospital and the Clinics and Seller will provide Purchaser with notice in the event of any union organizing activities or contract negotiations are commenced after the date hereof;
(e) Will not, except in the ordinary course of business, increase the compensation or bonuses payable or to become payable to any of the employees located at or connected with the operation of the Hospital or the Clinics, including employees located at the Seller's corporate or regional offices who work exclusively on matters related to the Hospital and the Clinics, or grant any severance benefits to any such employees other than to the extent such bonuses or severance payments impose no obligation on Purchaser after the Closing Date;
(f) Will not enter into any written employment agreements in connection with the operation of the Hospital or the Clinics other than with physicians in the ordinary course of business; provided, however, that Seller shall provide Purchaser with copies of any such physician contracts;
(g) Will not, except in the ordinary course of business, enter into any contract or commitment affecting any of the Seller's Assets, the Corporation's Assets or the Partnership's Assets or incur any additional indebtedness or amend, extend or renew any current debt instruments, whether in the ordinary course of business or otherwise, nor will Seller declare or pay any dividend or other distribution with respect to any of the Seller Assets nor pledge the accounts receivable of Seller as security for any indebtedness or lease agreements executed, amended or extended by Seller after the date hereof; provided, however, that nothing herein shall be construed as prohibiting (i) Seller or the Corporation from incurring inter-company indebtedness to Horizon and loaning the proceeds thereof to the Partnership or the Corporation or the Partnership from incurring such indebtednessand/or Continental Medical Systems, Inc. ("CMS"), (ii) Horizon or the Seller and/or CMS from incurring debt, the proceeds of which may be made available to Seller directly or by means of a working capital loan from Seller, the Corporation or the Partnership 's general partner to Seller or (iii) Seller, the Corporation or the Partnership Seller from executing any and all documents necessary to amend any debt instruments under which Horizon and/or CMS may be the borrower and Seller, the Corporation or the Partnership Seller a guarantor;
(hd) Will, during During normal business hours, Seller will provide Purchaser and its agents and employees with access on twenty-four (24) hours notice to the books and records of Seller (with respect relating to the Hospital and the Clinics), the Corporation, the Partnership, the Hospital and the Clinics Condominium Unit provided they do not interfere with the operation thereof;
(ie) Will operate If and to the extent Seller has not delegated responsibility therefor to SDRLP under the Hospital and Lease, Seller will maintain the Clinics Hospital Condominium Unit in substantial compliance with all applicable municipal, county, state and federal laws, regulations, ordinances, standards and orders as now in effect (including, without limitation, the building, zoning and life safety codes as currently applied with respect thereto) where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(jf) Will If and to the extent Seller has not delegated responsibility therefor to SDRLP under the Hospital Lease, Seller will take all reasonable action to achieve substantial compliance with any laws, regulations, ordinances, standards and orders applicable to the Hospital and the Clinics Condominium Unit which are enacted or issued after execution of this Agreement and become effective or require compliance prior to the Closing where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(kg) Will cause Within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, Seller shall advise Purchaser whether it intends to correct the Corporation's Assets and the Partnership's Assets defects to be maintained in substantially the same condition as they were in at the date hereof, ordinary wear and tear, casualty loss and taking by eminent domain exceptedwhich Purchaser has objected;
(lh) Will provide Purchaser with copies of the Corporation's If and the Partnership's monthly financial statements prepared in the ordinary course of business;
(m) Will provide Purchaser with copies of all licensure or certification surveys received by Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership and the related Plans of Correction prepared by Seller, the Corporation or the Partnership, as applicable;
(n) Will cause the Partnership to pay as and when due the accounts payable which arise in the ordinary course of the business of the Hospital and the Clinics, except to the extent that the amount owing is being duly contested by Seller, the Corporation or the Partnership and such contest does Seller has not materially affect Seller, the Corporation, the Partnership, delegated responsibility therefor to SDRLP under the Hospital or the Clinics;
(o) Will maintain in force the existing insurance coverage with respect to the Hospital and the Clinics described in Exhibit 6.31;
(p) Will Lease, Seller will file all returns, reports and filings of any kind or nature, or to secure timely extensions for the filing thereof, required to be filed by Seller (with respect to the Seller's Assets, the Hospital and the Clinics), the Corporation or the Partnership, including, but not limited to, state and federal tax returns and Medicare and Medicaid cost reports with respect to the Hospital and the Clinics Condominium Unit and will timely pay all taxes or other obligations which are due and payable with respect thereto, except thereto where the failure to the extent that pay the same are being duly contested is reasonably likely to result in good faith in accordance with applicable law and such contest does not materially affect Seller's ability to fulfill its obligations under this Agreement or to consummate the transaction provided for herein or the Corporation, the Partnership, imposition of a lien on the Hospital or Condominium Unit not permitted by the Clinicsterms of this Agreement;
(q) Will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; and
(r) Will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.27.
(si) Unless specifically prohibited by law, Seller will use its best efforts to cause all of the conditions to Closing set forth in Paragraphs 12.01 and 12.02 which are within Seller's control to be satisfied prior to the Outside Closing Date and Seller will not take any action inconsistent with its obligations under this Agreement or which could hinder or delay the consummation of the transactions contemplated by this Agreement or which is intended to cause any representation, warranty or covenant made by Seller in this Agreement;
(tj) Neither Seller nor any of its officers, directorspartners, advisors or others authorized to act on its behalf shall directly initiate or solicit discussions relating to any alternative acquisition proposal or similar transaction including, without limitation, a merger or other business combination involving Seller, Seller or any of the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets, or offer to acquire or convey in any manner, directly or indirectly, all or substantially all of the equity interests in, the voting securities of Seller, in Seller or the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets; provided, however, that public announcements of the transaction contemplated by this Agreement shall not be prohibited hereby; ;
(uk) Will Seller will proceed with all due diligence to secure the Regulatory Approvals and Third Party Consents for which it is responsible under the terms hereof;; and
(vl) Will Seller will cooperate with Purchaser, at Purchaser's cost and expense, in any audits of the results of operations at relating to the Hospital and/or the Clinics Condominium Unit which Purchaser elects to conduct in order to comply with any requirements applicable to it under the federal securities laws;
(w) Shall, within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected; and
(x) Will take such action as may be necessary to ensure that the assets and the liabilities of the Corporation on the Closing Date exclude the following:
(i) The Corporation's cash, cash equivalents and accounts receivable (the "Cash and Cash Equivalents").
(ii) Any claims which the Corporation may have against third parties relating to or arising from the acts or omissions of third parties prior to the Closing (the "Third Party Claims").
(iii) Any refunds to which the Corporation may now or hereafter be entitled relating to payments by or on behalf of the Corporation prior to the Closing including, without limitation, any federal, state, local or foreign taxes paid by the Corporation prior to the Closing Date (the "Refunds").
(iv) The bank accounts of the Corporation (the "Bank Accounts").
(v) The items owned by the Corporation and listed on Exhibit 9.02 (x)(v);
(vi) All computer hardware and software relating to the wide area network of Horizon used by the Corporation or the Partnership for the operation of the general ledger and accounts payable software applications, which computer hardware and software is more fully described in Exhibit 9.02(x)(vi) (the "GL/AP Hardware and Software");
(vii) Subject to the provisions of Paragraph 9.03(e), the Corporation's rights and interests in and to proprietary materials, programs, manuals, promotional materials and other intangibles owned or developed by Seller and used by the Corporation or the Partnership in connection with the operations at the Hospital and/or the Clinics.
(y) Will proceed with all due diligence to cause the Operations Restructuring to be completed as of the Closing Date pursuant to the terms of documents, including, but not limited to, the Assignment of the Hospital Lease, the Assignment of the Clinic Leases, the Hospital Sublease, the Clinic Subleases and the Amended Management Agreement, in form and substance reasonably acceptable to Seller and Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Regency Health Services Inc)
Pre-Closing Date. Seller covenants that between the date hereof and the Closing Date, except as contemplated by this Agreement or with the consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed, Seller, the Corporation and the Partnership:
(a) Will Seller will operate the Hospital and the Clinics Clinic only in the ordinary course and with due regard to the proper maintenance and repair of any real property or personal property associated therewith, ordinary wear and tear excepted;
(b) Will Seller will take all reasonable action to preserve the goodwill and the present occupancy levels of the Hospital and the ClinicsClinic, it being understood and agreed that they Seller shall not be required to undertake any action to preserve occupancy levels other than continuing to engage in the routine marketing activities in which they are it is currently engaged at the Hospital and the ClinicsClinic;
(c) Except in conjunction with the Operations Restructuring, Seller will not make any material change in the operation of the Hospital or the Clinics Clinic nor, except in the ordinary course of business, sell or agree to sell any items of machinery, equipment or other fixed assets of the Hospital, including but not limited to assets and equipment used in connection with the operation of the Hospital or the Clinics Clinic nor otherwise enter into any agreements materially affecting the Hospital or the ClinicsClinic;
(d) Will Seller will use its reasonable efforts to retain the goodwill of the employees of, medical staff of or physicians under contract with, Seller, the Corporation and the Partnership, Seller located at or connected with the operation of the Hospital and the Clinics Clinic and will provide Purchaser with notice in the event of any union organizing activities or contract negotiations are commenced after the date hereof;
(e) Will not, except Except in the ordinary course of business, Seller will not increase the compensation or bonuses payable or to become payable to any of the its employees located at or connected with the operation of the Hospital or the ClinicsClinic, including employees located at the Seller's corporate or regional offices who work exclusively on matters related to the Hospital and the ClinicsClinic, or grant any severance benefits to any such employees other than to the extent such bonuses or severance payments impose no obligation on Purchaser after the Closing Date;
(f) Will Seller will not enter into any written employment agreements in connection with the operation of the Hospital or the Clinics Clinic other than with physicians in the ordinary course of business; provided, however, that Seller shall provide Purchaser with copies of any such physician contracts;
(g) Will Seller will not, except in the ordinary course of business, enter into any contract or commitment affecting any of the Seller's Assets, the Corporation's Assets or the Partnership's Assets or incur any additional indebtedness or amend, extend or renew any current debt instruments, whether in the ordinary course of business or otherwise, nor will Seller declare or pay any dividend or other distribution with respect to any of the Seller Assets nor pledge the accounts receivable of Seller as security for any indebtedness or lease agreements executed, amended or extended by Seller after the date hereof; provided, however, that nothing herein shall be construed as prohibiting (i) Seller or the Corporation from incurring inter-company indebtedness to Horizon and loaning the proceeds thereof to the Partnership or the Corporation or the Partnership from incurring such indebtednessand/or CMS, (ii) Horizon or the Seller and/or CMS from incurring debt, the proceeds of which may be made available to Seller directly or by means of a working capital loan from Seller, the Corporation or the Partnership 's general partner to Seller or (iii) Seller, the Corporation or the Partnership Seller from executing any and all documents necessary to amend any debt instruments under which Horizon and/or CMS may be the borrower and Seller, the Corporation or the Partnership Seller a guarantor;
(h) Will, during During normal business hours, Seller will provide Purchaser and its agents and employees with access on twenty-four (24) hours notice to the books and records of Seller (with respect to and the Hospital and the Clinics), the Corporation, the Partnership, the Hospital and the Clinics Clinic provided they do not interfere with the operation thereof;
(i) Will Seller will operate the Hospital and the Clinics Clinic in substantial compliance with all applicable municipal, county, state and federal laws, regulations, ordinances, standards and orders as now in effect (including, without limitation, the building, zoning and life safety codes as currently applied with respect thereto) where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(j) Will Seller will take all reasonable action to achieve substantial compliance with any laws, regulations, ordinances, standards and orders applicable to the Hospital and the Clinics Clinic which are enacted or issued after execution of this Agreement and become effective or require compliance prior to the Closing where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(k) Will cause Seller will maintain the CorporationSeller's Assets and the Partnership's Assets to be maintained in substantially the same condition as they were in at the date hereof, ordinary wear and tear, casualty loss and taking by eminent domain excepted;
(l) Will Seller will provide Purchaser with copies of the Corporation's and the Partnership's its monthly financial statements prepared in the ordinary course of business;
(m) Will Seller will provide Purchaser with copies of all licensure or certification surveys received by Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership and the related Plans of Correction prepared by Seller, the Corporation or the Partnership, as applicable;
(n) Will cause the Partnership to Seller will pay as and when due the accounts payable which arise in the ordinary course of the business of the Hospital and the Clinicsbusiness, except to the extent that the amount owing is being duly contested by Seller, the Corporation or the Partnership Seller and such contest does not materially affect Seller, the Corporation, the Partnership, Seller or the Hospital or the ClinicsClinic;
(o) Will Within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, Seller shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected;
(p) Seller will maintain in force the existing insurance coverage with respect to the Hospital and the Clinics Clinic described in Exhibit 6.316.28;
(pq) Will Seller will file all returns, reports and filings of any kind or nature, or to secure timely extensions for the filing thereof, required to be filed by Seller (with respect to the Seller's Assets, the Hospital and the Clinics), the Corporation or the Partnership, including, but not limited to, state and federal tax returns and Medicare and Medicaid cost reports with respect to the Hospital and the Clinics Clinic and will timely pay all taxes or other obligations which are due and payable with respect thereto, except to the extent that the same are being duly contested in good faith in accordance with applicable law and such contest does not materially affect Seller's ability to fulfill its obligations under this Agreement Seller or to consummate the transaction provided for herein or the Corporation, the Partnership, the Hospital or the Clinics;
(q) Will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; andClinic;
(r) Will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.27.
(s) Unless specifically prohibited by law, Seller will use its best efforts to cause all of the conditions to Closing set forth in Paragraphs 12.01 and 12.02 which are within Seller's control to be satisfied prior to the Outside Closing Date and Seller will not take any action inconsistent with its obligations under this Agreement or which could hinder or delay the consummation of the transactions contemplated by this Agreement;
(ts) Neither Seller nor any of its officers, directors, advisors or others authorized to act on its behalf shall directly initiate or solicit discussions relating to any alternative acquisition proposal or similar transaction including, without limitation, a merger or other business combination involving Seller, Seller or any of the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets, or offer to acquire or convey in any manner, directly or indirectly, all or substantially all of the equity interests in, the voting securities of Seller, Seller or the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets; provided, however, that public announcements of the transaction contemplated by this Agreement shall not be prohibited hereby;
(t) Seller will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; (u) Will Seller will proceed with all due diligence to secure the Regulatory Approvals and Third Party Consents for which it is responsible under the terms hereof;
(v) Will Seller will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.24; and
(w) Seller will cooperate with Purchaser, at Purchaser's cost and expense, in any audits of the results of operations at the Hospital and/or the Clinics Clinic which Purchaser elects to conduct in order to comply with any requirements applicable to it under the federal securities laws;
(w) Shall, within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected; and
(x) Will take such action as may be necessary to ensure that the assets and the liabilities of the Corporation on the Closing Date exclude the following:
(i) The Corporation's cash, cash equivalents and accounts receivable (the "Cash and Cash Equivalents").
(ii) Any claims which the Corporation may have against third parties relating to or arising from the acts or omissions of third parties prior to the Closing (the "Third Party Claims").
(iii) Any refunds to which the Corporation may now or hereafter be entitled relating to payments by or on behalf of the Corporation prior to the Closing including, without limitation, any federal, state, local or foreign taxes paid by the Corporation prior to the Closing Date (the "Refunds").
(iv) The bank accounts of the Corporation (the "Bank Accounts").
(v) The items owned by the Corporation and listed on Exhibit 9.02 (x)(v);
(vi) All computer hardware and software relating to the wide area network of Horizon used by the Corporation or the Partnership for the operation of the general ledger and accounts payable software applications, which computer hardware and software is more fully described in Exhibit 9.02(x)(vi) (the "GL/AP Hardware and Software");
(vii) Subject to the provisions of Paragraph 9.03(e), the Corporation's rights and interests in and to proprietary materials, programs, manuals, promotional materials and other intangibles owned or developed by Seller and used by the Corporation or the Partnership in connection with the operations at the Hospital and/or the Clinics.
(y) Will proceed with all due diligence to cause the Operations Restructuring to be completed as of the Closing Date pursuant to the terms of documents, including, but not limited to, the Assignment of the Hospital Lease, the Assignment of the Clinic Leases, the Hospital Sublease, the Clinic Subleases and the Amended Management Agreement, in form and substance reasonably acceptable to Seller and Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Regency Health Services Inc)
Pre-Closing Date. Seller covenants that between the date hereof and the Closing Date, except as contemplated by this Agreement or with the consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed, Seller, the Corporation and the Partnership:
(a) Will operate Seller will enforce the obligations of SBRH under the Hospital Lease and the Clinics only in the ordinary course and with due regard to the proper maintenance and repair of any real property or personal property associated therewith, ordinary wear and tear excepted;Equipment Lease.
(b) Will take all reasonable action to preserve the goodwill and the present occupancy levels of the Hospital and the Clinics, it being understood and agreed that they shall not be required to undertake any action to preserve occupancy levels other than continuing to engage in the routine marketing activities in which they are currently engaged at the Hospital and the Clinics;
(c) Except in conjunction with the Operations Restructuring, Seller will not make any material change in the operation of the Hospital or the Clinics nor, except in the ordinary course of business, sell or agree to sell any items of machinery, equipment or other fixed assets of the Hospital, including but not limited to assets and equipment used in connection with the operation of the Hospital or the Clinics Seller's Assets nor otherwise enter into any agreements materially affecting the Hospital or the ClinicsSeller's Assets;
(dc) Will use its reasonable efforts to retain the goodwill of the employees of, medical staff of or physicians under contract with, Seller, the Corporation and the Partnership, located at or connected with the operation of the Hospital and the Clinics and Seller will provide Purchaser with notice in the event of any union organizing activities or contract negotiations are commenced after the date hereof;
(e) Will not, except in the ordinary course of business, increase the compensation or bonuses payable or to become payable to any of the employees located at or connected with the operation of the Hospital or the Clinics, including employees located at the Seller's corporate or regional offices who work exclusively on matters related to the Hospital and the Clinics, or grant any severance benefits to any such employees other than to the extent such bonuses or severance payments impose no obligation on Purchaser after the Closing Date;
(f) Will not enter into any written employment agreements in connection with the operation of the Hospital or the Clinics other than with physicians in the ordinary course of business; provided, however, that Seller shall provide Purchaser with copies of any such physician contracts;
(g) Will not, except in the ordinary course of business, enter into any contract or commitment affecting any of the Seller's Assets, the Corporation's Assets or the Partnership's Assets or incur any additional indebtedness or amend, extend or renew any current debt instruments, whether in the ordinary course of business or otherwise, nor will Seller declare or pay any dividend or other distribution with respect to any of the Seller Assets nor pledge the accounts receivable of Seller as security for any indebtedness or lease agreements executed, amended or extended by Seller after the date hereof; provided, however, that nothing herein shall be construed as prohibiting (i) Seller or the Corporation from incurring inter-company indebtedness to Horizon and loaning the proceeds thereof to the Partnership or the Corporation or the Partnership from incurring such indebtednessand/or Continental Medical Systems, Inc. ("CMS"), (ii) Horizon or the Seller and/or CMS from incurring debt, the proceeds of which may be made available to Seller directly or by means of a working capital loan from Seller, the Corporation or the Partnership 's general partner to Seller or (iii) Seller, the Corporation or the Partnership Seller from executing any and all documents necessary to amend any debt instruments under which Horizon and/or CMS may be the borrower and Seller, the Corporation or the Partnership Seller a guarantor;
(hd) Will, during During normal business hours, Seller will provide Purchaser and its agents and employees with access on twenty-four (24) hours notice to the books and records of Seller (with respect relating to the Hospital and the Clinics), the Corporation, the Partnership, the Hospital and the Clinics Seller's Assets provided they do not interfere with the operation thereof;
(ie) Will operate If and to the extent Seller has not delegated responsibility therefor to SBRH under the Hospital and Lease or the Clinics Equipment Lease, Seller will maintain the Seller's Assets in substantial compliance with all applicable municipal, county, state and federal laws, regulations, ordinances, standards and orders as now in effect (including, without limitation, the building, zoning and life safety codes as currently applied with respect thereto) where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(jf) Will If and to the extent Seller has not delegated responsibility therefor to SBRH under the Hospital Lease or the Equipment Lease, Seller will take all reasonable action to achieve substantial compliance with any laws, regulations, ordinances, standards and orders applicable to the Hospital and the Clinics Seller's Assets which are enacted or issued after execution of this Agreement and become effective or require compliance prior to the Closing where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(kg) Will cause Within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, Seller shall advise Purchaser whether it intends to correct the Corporation's Assets and the Partnership's Assets defects to be maintained in substantially the same condition as they were in at the date hereof, ordinary wear and tear, casualty loss and taking by eminent domain exceptedwhich Purchaser has objected;
(lh) Will provide Purchaser with copies of the Corporation's If and the Partnership's monthly financial statements prepared in the ordinary course of business;
(m) Will provide Purchaser with copies of all licensure or certification surveys received by Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership and the related Plans of Correction prepared by Seller, the Corporation or the Partnership, as applicable;
(n) Will cause the Partnership to pay as and when due the accounts payable which arise in the ordinary course of the business of the Hospital and the Clinics, except to the extent that Seller has not delegated responsibility therefor to SBRH under the amount owing is being duly contested by Seller, the Corporation Hospital Lease or the Partnership and such contest does not materially affect SellerEquipment Lease, the Corporation, the Partnership, the Hospital or the Clinics;
(o) Will maintain in force the existing insurance coverage with respect to the Hospital and the Clinics described in Exhibit 6.31;
(p) Will Seller will file all returns, reports and filings of any kind or nature, or to secure timely extensions for the filing thereof, required to be filed by Seller (with respect to the Seller's Assets, the Hospital and the Clinics), the Corporation or the Partnership, including, but not limited to, state and federal tax returns and Medicare and Medicaid cost reports with respect to the Hospital and the Clinics Seller's Assets and will timely pay all taxes or other obligations which are due and payable with respect thereto, except thereto where the failure to the extent that pay the same are being duly contested is reasonably likely to result in good faith in accordance with applicable law and such contest does not materially affect the imposition of a lien on the Seller's ability to fulfill its obligations under Assets not permitted by the terms of this Agreement or to consummate the transaction provided for herein or the Corporation, the Partnership, the Hospital or the ClinicsAgreement;
(q) Will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; and
(r) Will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.27.
(si) Unless specifically prohibited by law, Seller will use its best efforts to cause all of the conditions to Closing set forth in Paragraphs 12.01 and 12.02 which are within Seller's control to be satisfied prior to the Outside Closing Date and Seller will not take any action inconsistent with its obligations under this Agreement or which could hinder or delay the consummation of the transactions contemplated by this Agreement or which is intended to cause any representation, warranty or covenant made by Seller in this Agreement;
; (tj) Neither Seller nor any of its officers, directors, advisors or others authorized to act on its behalf shall directly initiate or solicit discussions relating to any alternative acquisition proposal or similar transaction including, without limitation, a merger or other business combination involving Seller, Seller or any of the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets, or offer to acquire or convey in any manner, directly or indirectly, all or substantially all of the equity interests in, the voting securities of Seller, in Seller or the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets; provided, however, that public announcements of the transaction contemplated by this Agreement shall not be prohibited hereby; ;
(uk) Will Seller will proceed with all due diligence to secure the Regulatory Approvals and Third Party Consents for which it is responsible under the terms hereof;; and
(vl) Will Seller will cooperate with Purchaser, at Purchaser's cost and expense, in any audits of relating to the results of operations at the Hospital and/or the Clinics Seller's Assets which Purchaser elects to conduct in order to comply with any requirements applicable to it under the federal securities laws;
(w) Shall, within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected; and
(x) Will take such action as may be necessary to ensure that the assets and the liabilities of the Corporation on the Closing Date exclude the following:
(i) The Corporation's cash, cash equivalents and accounts receivable (the "Cash and Cash Equivalents").
(ii) Any claims which the Corporation may have against third parties relating to or arising from the acts or omissions of third parties prior to the Closing (the "Third Party Claims").
(iii) Any refunds to which the Corporation may now or hereafter be entitled relating to payments by or on behalf of the Corporation prior to the Closing including, without limitation, any federal, state, local or foreign taxes paid by the Corporation prior to the Closing Date (the "Refunds").
(iv) The bank accounts of the Corporation (the "Bank Accounts").
(v) The items owned by the Corporation and listed on Exhibit 9.02 (x)(v);
(vi) All computer hardware and software relating to the wide area network of Horizon used by the Corporation or the Partnership for the operation of the general ledger and accounts payable software applications, which computer hardware and software is more fully described in Exhibit 9.02(x)(vi) (the "GL/AP Hardware and Software");
(vii) Subject to the provisions of Paragraph 9.03(e), the Corporation's rights and interests in and to proprietary materials, programs, manuals, promotional materials and other intangibles owned or developed by Seller and used by the Corporation or the Partnership in connection with the operations at the Hospital and/or the Clinics.
(y) Will proceed with all due diligence to cause the Operations Restructuring to be completed as of the Closing Date pursuant to the terms of documents, including, but not limited to, the Assignment of the Hospital Lease, the Assignment of the Clinic Leases, the Hospital Sublease, the Clinic Subleases and the Amended Management Agreement, in form and substance reasonably acceptable to Seller and Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Regency Health Services Inc)
Pre-Closing Date. Seller covenants that between the date hereof and the Closing Date, except as contemplated by this Agreement or with the consent of Purchaser, which consent shall not be unreasonably withheld, conditioned or delayed, Seller, the Corporation and the Partnership:
(a) Will operate the Hospital and the Clinics Facilities only in the ordinary course and with due regard to the proper maintenance and repair of any real property or personal property associated therewith, ordinary wear and tear excepted;
(b) Will take all reasonable action to preserve the goodwill and the present occupancy levels of the Hospital and the ClinicsFacilities, it being understood and agreed that they shall not be required to undertake any action to preserve occupancy levels other than continuing to engage in the routine marketing activities in which they are currently engaged at the Hospital and the ClinicsFacilities;
(c) Except in conjunction with the Operations Restructuring, will Will not make any material change in the operation of the Hospital or the Clinics Facilities nor, except in the ordinary course of business, sell or agree to sell any items of machinery, equipment or other fixed assets of the HospitalFacilities, including but not limited to assets and equipment used in connection with the operation of the Hospital or the Clinics Facilities nor otherwise enter into any agreements materially affecting the Hospital or the ClinicsFacilities;
(d) Will use its reasonable efforts to retain the goodwill of the employees of, medical staff of or physicians under contract with, Seller, the Corporation and the Partnership, Seller located at or connected with the operation of the Hospital and the Clinics Facilities and will provide Purchaser with notice in the event of any union organizing activities or contract negotiations are commenced after the date hereof;
(e) Will not, except in the ordinary course of business, increase the compensation or bonuses payable or to become payable to any of the employees located at or connected with the operation of the Hospital or the ClinicsFacilities, including employees located at the Seller's corporate or regional offices who work exclusively on matters related to the Hospital and the ClinicsFacilities, or grant any severance benefits to any such employees other than to the extent such bonuses or severance payments impose no obligation on Purchaser after the Closing Date;
(f) Will not enter into any written employment agreements in connection with the operation of the Hospital or the Clinics Facilities other than with physicians in the ordinary course of business; provided, however, that Seller shall provide Purchaser with copies of any such physician contracts;
(g) Will not, except in the ordinary course of business, enter into any contract or commitment affecting any of the Seller's Assets, the Corporation's Assets or the Partnership's Assets or incur any additional indebtedness or amend, extend or renew any current debt instruments, whether in the ordinary course of business or otherwise, nor will Seller declare or pay any dividend or other distribution with respect to any of the Seller Assets nor pledge the accounts receivable of Seller as security for any indebtedness or lease agreements executed, amended or extended by Seller after the date hereof; provided, however, that nothing herein shall be construed as prohibiting (i) Seller or the Corporation from incurring inter-company indebtedness to Horizon and/or CMS and loaning the proceeds thereof to the Partnership Seller or the Corporation or the Partnership Seller from incurring such indebtedness, (ii) Horizon or the Seller and/or CMS from incurring debt, the proceeds of which may be made available to Seller, the Corporation or the Partnership Seller or (iii) Seller, the Corporation or the Partnership Seller from executing any and all documents necessary to amend any debt instruments under which Horizon and/or CMS may be the borrower and Seller, the Corporation or the Partnership Seller a guarantor;
(h) Will, during normal business hours, provide Purchaser and its agents and employees with access on twenty-four (24) hours notice to the books and records of Seller (with respect to or the Hospital and the Clinics), the Corporation, the Partnership, the Hospital and the Clinics Facilities provided they do not interfere with the operation thereof;
(i) Will operate each of the Hospital and the Clinics Facilities in substantial compliance with all applicable municipal, county, state and federal laws, regulations, ordinances, standards and orders as now in effect (including, without limitation, the building, zoning and life safety codes as currently applied with respect thereto) where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(j) Will take all reasonable action to achieve substantial compliance with any laws, regulations, ordinances, standards and orders applicable to each of the Hospital and the Clinics Facilities which are enacted or issued after execution of this Agreement and become effective or require compliance prior to the Closing where the failure to comply therewith could have a material adverse effect on the business, property, condition (financial or otherwise) or operation thereof;
(k) Will cause maintain the CorporationSeller's Assets and the Partnership's Assets to be maintained in substantially the same condition as they were in at the date hereof, ordinary wear and tear, casualty loss and taking by eminent domain excepted;
(l) Will provide Purchaser with copies of the Corporation's and the PartnershipSeller's monthly financial statements prepared in the ordinary course of business;
(m) Will provide Purchaser with copies of all licensure or certification surveys received by Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership and the related Plans of Correction prepared by Seller, the Corporation or the Partnership, as applicable;
(n) Will cause the Partnership to pay as and when due the accounts payable which arise in the ordinary course of the business of the Hospital and the Clinicsbusiness, except to the extent that the amount owing is being duly contested by Seller, the Corporation or the Partnership Seller and such contest does not materially affect Seller, Seller or any of the Corporation, the Partnership, the Hospital or the ClinicsFacilities;
(o) Will maintain in force the existing insurance coverage with respect to the Hospital and the Clinics Facilities described in Exhibit 6.316.25;
(p) Will file all returns, reports and filings of any kind or nature, or to secure timely extensions for the filing thereof, required to be filed by Seller (with respect to the Seller's Assets, the Hospital and the Clinics), the Corporation or the Partnership, including, but not limited to, state and federal tax returns and Medicare and Medicaid cost reports with respect to the Hospital and the Clinics Facilities and will timely pay all taxes or other obligations which are due and payable with respect thereto, except to the extent that the same are being duly contested in good faith in accordance with applicable law and such contest does not materially affect Seller's ability to fulfill its obligations under this Agreement Seller or to consummate any of the transaction provided for herein or the Corporation, the Partnership, the Hospital or the ClinicsFacilities;
(q) Will provide to Purchaser copies of all material documents which relate to, and, upon request, with verbal or written updates concerning the status of, any litigation filed as of the date hereof or filed from and after the date hereof by or against Seller (with respect to the Hospital and the Clinics), the Corporation or the Partnership after the date of this Agreement but prior to the Closing Date where the amount claimed or assessed by management of Seller as likely to be claimed exceeds $500,000; and;
(r) Will not amend or permit the amendment of any of the Medical Staff Bylaws described in Paragraph 6.27.6.24;
(s) Unless specifically prohibited by law, Seller will use its best efforts to cause all of the conditions to Closing set forth in Paragraphs 12.01 and 12.02 which are within Seller's control to be satisfied prior to the Outside Closing Date and Seller will not take any action inconsistent with its obligations under this Agreement or which could hinder or delay the consummation of the transactions contemplated by this Agreement;
(t) Neither Seller nor any of its officers, directors, advisors or others authorized to act on its behalf shall directly initiate or solicit discussions relating to any alternative acquisition proposal or similar transaction including, without limitation, a merger or other business combination involving Seller, any of the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets, or offer to acquire or convey in any manner, directly or indirectly, all or substantially all of the equity interests in, the voting securities of Seller, the Seller's Assets, the Corporation's Assets, the Partnership or the Partnership Assets; provided, however, that public announcements of the transaction contemplated by this Agreement shall not be prohibited hereby; ;
(u) Will Seller will proceed with all due diligence to secure the Regulatory Approvals and Third Party Consents for which it is responsible under the terms hereof;
(v) Will Seller will cooperate with Purchaser, at Purchaser's cost and expense, in any audits of the results of operations at the Hospital and/or the Clinics Facilities which Purchaser elects to conduct in order to comply with any requirements applicable to it under the federal securities laws;; and
(w) Shall, within Within ten (10) days after Seller's receipt of Purchaser's title, UCC search and survey objections pursuant to Paragraph 10.01, Seller shall advise Purchaser whether it intends to correct the defects to which Purchaser has objected; and
(x) Will take such action as may be necessary to ensure that the assets and the liabilities of the Corporation on the Closing Date exclude the following:
(i) The Corporation's cash, cash equivalents and accounts receivable (the "Cash and Cash Equivalents").
(ii) Any claims which the Corporation may have against third parties relating to or arising from the acts or omissions of third parties prior to the Closing (the "Third Party Claims").
(iii) Any refunds to which the Corporation may now or hereafter be entitled relating to payments by or on behalf of the Corporation prior to the Closing including, without limitation, any federal, state, local or foreign taxes paid by the Corporation prior to the Closing Date (the "Refunds").
(iv) The bank accounts of the Corporation (the "Bank Accounts").
(v) The items owned by the Corporation and listed on Exhibit 9.02 (x)(v);
(vi) All computer hardware and software relating to the wide area network of Horizon used by the Corporation or the Partnership for the operation of the general ledger and accounts payable software applications, which computer hardware and software is more fully described in Exhibit 9.02(x)(vi) (the "GL/AP Hardware and Software");
(vii) Subject to the provisions of Paragraph 9.03(e), the Corporation's rights and interests in and to proprietary materials, programs, manuals, promotional materials and other intangibles owned or developed by Seller and used by the Corporation or the Partnership in connection with the operations at the Hospital and/or the Clinics.
(y) Will proceed with all due diligence to cause the Operations Restructuring to be completed as of the Closing Date pursuant to the terms of documents, including, but not limited to, the Assignment of the Hospital Lease, the Assignment of the Clinic Leases, the Hospital Sublease, the Clinic Subleases and the Amended Management Agreement, in form and substance reasonably acceptable to Seller and Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Regency Health Services Inc)
