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ASSET PURCHASE AGREEMENT
BETWEEN
BMJ MEDICAL MANAGEMENT, INC.
AND
VALLEY SPORTS & ARTHRITIS SURGEONS, P.C.
Dated as of October 3, 1997
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TABLE OF CONTENTS
Page
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ARTICLE I TRANSFER OF PURCHASED ASSETS, ASSUMPTION OF
LIABILITIES AND RELATED MATTERS ......................... 1
1.1. Transfer of Assets ...................................... 1
1.2. Assets Not Being Transferred ............................ 2
1.3. Liabilities Being Assumed ............................... 2
1.4. Liabilities Not Being Assumed ........................... 3
1.5. Instruments of Conveyance and Transfer, Etc ............. 3
1.6. Right of Endorsement, Etc. .............................. 4
1.7. Further Assurances ...................................... 5
1.8. Assignment of Leases .................................... 5
ARTICLE II PURCHASE PRICE; ALLOCATION .............................. 6
2.1. Purchase Price; Payment ................................. 6
2.2. Allocation of Purchase Price ............................ 6
2.3 Accounts Receivable Payment ............................. 6
ARTICLE III REPRESENTATIONS AND WARRANTIES .......................... 7
3.1. Representations and Warranties of the Seller ............ 7
3.2. Representations and Warranties of the Buyer ............. 11
ARTICLE IV CONDITIONS TO CLOSING ................................... 13
4.1. Conditions to Each Party's Obligations .................. 13
4.2. Conditions to Obligations of the Buyer .................. 14
4.3. Conditions to Obligations of the Seller ................. 15
4.4. Related Agreements ...................................... 16
ARTICLE V CLOSING ................................................. 16
5.1. Date .................................................... 16
5.2. Closing Transactions .................................... 16
ARTICLE VI INDEMNIFICATION ......................................... 17
6.1. Definitions ............................................. 17
6.2. Indemnification Generally ............................... 19
6.3. Assertion of Claims ..................................... 19
6.4. Notice and Defense of Third Party Claims ................ 20
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6.5. Survival of Representations, Warranties and Covenants ... 21
ARTICLE VII AMENDMENT, MODIFICATION AND WAIVER ...................... 22
ARTICLE VIII MISCELLANEOUS ........................................... 22
8.1. Transfer Taxes, Etc. .................................... 22
8.2. Entire Agreement ........................................ 23
8.3. Descriptive Headings .................................... 23
8.4. Notices ................................................. 23
8.5. Counterparts ............................................ 24
8.6. Bulk Sales Compliance ................................... 24
8.7. Governing Law ........................................... 25
8.8. Attorneys' Fees ......................................... 25
8.9. Benefits of Agreement ................................... 25
8.10. Pronouns ................................................ 25
(ii)
EXHIBITS
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Exhibit A - Xxxx of Sale
Exhibit B - Assignment and Assumption Agreement
Exhibit C - Promissory Note
SCHEDULES
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1.1(a) - Medical Equipment
1.1(b) - Furniture, Furnishings, Trade
Fixtures, and Office Equipment
1.1(c) - Equipment Leases
1.1(d) - Supplies
1.1(e) - Accounts Receivable
1.1(f) - Office Leases
1.1(g) - Deposits
1.1(h) - Additional Items
2.2 - Allocation of Purchase Price
3.1(b) - Seller Consents
3.1(c) - Claims
3.1(d) - Litigation
3.2(b) - Buyer Consents
Definitions
The following terms which may appear in more than one Section of this Agreement
are defined at the following pages:
TERM PAGE
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A/R Amount................................................................ 6
A/R Balance............................................................... 7
A/R Collections........................................................... 7
A/R Shortfall............................................................. 7
Accounts Receivable....................................................... 2
Affiliate................................................................. 17
Assignment and Assumption Agreement....................................... 3
Assumed Obligations....................................................... 3
Xxxx of Sale.............................................................. 3
bulk sales laws........................................................... 18
Business Day.............................................................. 24
Buyer..................................................................... 1
Buyer Indemnification Event............................................... 17
Buyer Indemnified Persons................................................. 18
Claims.................................................................... 9
Closing................................................................... 16
Closing Date.............................................................. 1
Determination Date........................................................ 6
Excluded Assets........................................................... 2
Excluded Obligations...................................................... 3
Final Statement........................................................... 6
Governance Documents...................................................... 8
Indemnified Persons....................................................... 18
Indemnifying Person....................................................... 18
Losses.................................................................... 18
Permitted Liens........................................................... 10
Purchase Price............................................................ 6
Purchased Assets.......................................................... 1
Related Agreements........................................................ 13
Seller.................................................................... 1
Seller Indemnification Event.............................................. 19
Seller Indemnified Persons................................................ 19
Statement of Allocation................................................... 6
Subject Business.......................................................... 1
THIS ASSET PURCHASE
AGREEMENT is entered into on
October 3, 1997 (the "Closing
Date"), between BMJ MEDICAL
MANAGEMENT, INC., a Delaware
corporation (the "Buyer"), and
VALLEY SPORTS & ARTHRITIS SURGEONS,
P.C., a Pennsylvania professional
corporation (the "Seller").
The Seller desires to sell, transfer, convey and assign to the Buyer and
the Buyer desires to purchase from the Seller, certain of the assets,
properties, interests in properties and rights of the Seller used in the
Seller's business (the "Subject Business") upon the terms and subject to the
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants and agreements hereinafter set forth, the
parties hereby agree as follows:
ARTICLE I
TRANSFER OF PURCHASED ASSETS, ASSUMPTION OF
LIABILITIES AND RELATED MATTERS
1.1. Transfer of Assets.
On the terms and subject to the conditions of this Agreement, at the
Closing (as hereinafter defined), the Seller shall sell, transfer, convey and
assign to the Buyer, and the Buyer shall purchase, assume, and accept from the
Seller, the following assets, properties, interests in properties and rights of
the Seller (the "Purchased Assets"), as the same shall exist immediately prior
to the Closing, free and clear of all Claims (as defined below) (except
Permitted Liens (as defined below)):
(a) the medical equipment owned by the Seller and listed on Schedule
1.1(a);
(b) the furniture, furnishings, trade fixtures, and office equipment owned
by the Seller and listed on Schedule 1.1(b);
(c) the Seller's rights and interests under the equipment leases identified
on Schedule 1.1(c), subject to the Buyer's assumption of the obligations
accruing thereunder as provided in Section 1.3;
(d) the supplies described on Schedule 1.1(d);
(e) the accounts receivable described on Schedule 1.1(e) (the "Accounts
Receivable") (subject to applicable law and in accordance with Section 1.6
hereof);
(f) the Seller's rights and interests under the office leases identified in
Schedule 1.1(f), subject to the Buyer's assumption of the obligations accruing
thereunder as provided in Section 1.3;
(g) the deposits identified on Schedule 1.1(g); and
(h) any additional items identified on Schedule 1.1(h).
1.2. Assets Not Being Transferred.
All assets, properties, interests in properties, and rights of the Seller
not expressly identified in Section 1.1 or the Schedules referenced therein (the
"Excluded Assets") are expressly excluded from the assets of the Seller being
sold, assigned, or otherwise transferred to the Buyer.
1.3. Liabilities Being Assumed.
Except as otherwise provided herein and subject to the terms and conditions
of this Agreement, simultaneously with the
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sale, transfer, conveyance and assignment to the Buyer of the Purchased Assets,
the Buyer shall assume, and hereby agrees to pay when due, those liabilities
accruing after the Closing Date (as hereinafter defined) under the equipment
leases identified in Schedule 1.1(c) and the office leases identified in
Schedule 1.1(f) (the "Assumed Obligations"); provided, however, that any and all
obligations and liabilities arising under any such lease as of or prior to the
Closing Date and any and all obligations and liabilities arising out of or in
connection with the Seller's breach of any such lease shall, in each case,
remain the obligations and liabilities of the Seller.
1.4. Liabilities Not Being Assumed.
The Buyer is not assuming any liabilities or obligations of the Seller
(fixed or contingent, known or unknown, matured or unmatured) whatsoever other
than the Assumed Obligations. For convenience of reference, all liabilities and
obligations of the Seller not being assumed by the Buyer are collectively
referred to as the "Excluded Obligations." The Seller hereby agrees to pay all
Excluded Obligations as and when such Excluded Obligations become due.
1.5. Instruments of Conveyance and Transfer, Etc.
At the Closing, the Seller shall deliver (or cause to be delivered) to the
Buyer such deeds, bills of sale, endorsements, assignments and other good and
sufficient instruments of sale, transfer, conveyance and assignment as shall be
necessary to sell, transfer, convey and assign to the Buyer, in accordance with
the terms hereof, title to the Purchased Assets, free and clear of all Claims
(except Permitted Liens), including, without limitation, the delivery of a Xxxx
of Sale (the "Xxxx of Sale") substantially in the form of Exhibit A attached
hereto and the delivery of an Assignment and Assumption Agreement (the
"Assignment and Assumption Agreement")
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substantially in the form of Exhibit B attached hereto. Simultaneously
therewith, the Seller shall take all steps as may be reasonably required to put
the Buyer in possession and operating control of the Purchased Assets.
1.6. Right of Endorsement, Etc.
Effective upon the Closing, the Seller hereby constitutes and appoints the
Buyer, its successors and assigns, the true and lawful attorney-in-fact of the
Seller with full power of substitution, in the name of the Buyer, or the name of
the Seller, on behalf of and for the benefit of the Buyer, to collect all
Accounts Receivable assigned to the Buyer as provided herein, to endorse,
without recourse, checks, notes and other instruments received in payment of
such Accounts Receivable, and to institute and prosecute, in the name of the
Seller or otherwise, all proceedings which the Buyer may deem proper in order to
assert or enforce any claim, right or title of any kind in or to the Purchased
Assets (provided that the Buyer shall not, without the consent of the Seller,
initiate any such proceeding to collect on Accounts Receivable acquired
hereunder), to defend and compromise any and all actions, suits or proceedings
in respect of any of the Purchased Assets and to do all such acts and things in
relation thereto as the Buyer may deem advisable. The foregoing powers are
coupled with an interest and shall be irrevocable by the Seller, directly or
indirectly, whether by the dissolution of the Seller or in any manner or for any
reason; provided, however that notwithstanding anything to the contrary
contained herein, collections of Medicare and Medicaid Accounts Receivable shall
first be deposited by the Seller into its bank account and shall thereafter be
transferred by the Seller to an account designated by the Buyer.
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1.7. Further Assurances.
The Seller shall pay or cause to be paid to the Buyer promptly any amounts
which shall be received by the Seller after the Closing which constitute
Purchased Assets, including all amounts paid to the Seller on account of the
Accounts Receivable. The Seller shall, at any time and from time to time after
the Closing, upon the reasonable request of the Buyer, execute, acknowledge,
deliver and file, or cause to be executed, acknowledged, delivered or filed, and
perform or cause to be performed all such further acts, transfers, conveyances,
assignments or assurances as may reasonably be required for better selling,
transferring, conveying, assigning and assuring to the Buyer, or for aiding and
assisting in the collection of or reducing to possession by the Buyer, any of
the assets, properties, interests in properties or rights being purchased by the
Buyer hereunder. Any expenses incurred in connection with the foregoing shall be
borne by the Seller.
1.8. Assignment of Leases.
Anything contained in this Agreement to the contrary notwithstanding, this
Agreement shall not constitute an agreement or attempted agreement to assign any
office lease or equipment lease if an attempted assignment thereof, without the
consent of any other party thereto, would constitute a breach thereof or in any
way affect the rights of the Buyer or the Seller thereunder. The Seller shall
use its best efforts, and the Buyer shall cooperate with the Seller, to obtain
the consent of any such third party to the assignment thereof to the Buyer. If
such consent is not obtained, the Seller shall cooperate with the Buyer in any
arrangements reasonably necessary or desirable to provide for the Buyer the
benefits (together with the obligations to perform) thereunder.
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ARTICLE II
PURCHASE PRICE; ALLOCATION
2.1. Purchase Price; Payment.
The purchase price (the "Purchase Price") to be paid for the Purchased
Assets shall equal the sum of the following amounts:
(a) $267,727; and
(b) $630,000 (the "A/R Amount"), subject to adjustment in accordance
with Section 2.3, which amount is a good faith estimate of the aggregate
face value of all Accounts Receivable outstanding as of the Closing Date
and set forth on Schedule 1.1(e).
2.2. Allocation of Purchase Price.
The Purchase Price shall be allocated among the Purchased Assets in a
statement (the "Statement of Allocation") reflecting the allocation set forth in
Schedule 2.2 attached hereto. The parties shall complete their respective tax
returns for the period which includes the Closing Date in a manner that is
consistent with the Statement of Allocation.
2.3. Accounts Receivable Payment.
The portion of the Purchase Price specified in Section 2.1(b) is subject to
adjustment and shall be paid or repaid as follows:
(a) Within thirty (30) days after March 1, 1998 (the "Determination
Date"), the Buyer shall furnish to the Seller a statement (the "Final
Statement") setting forth the aggregate amount of collections received by
the Buyer in payment of the Accounts Receivable as of the Determination
Date (the "A/R
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Collections"), including detail of write-offs of any of the Accounts
Receivable, the remaining outstanding balance of the Accounts Receivable,
and any other detail relating thereto as the Seller may reasonably request.
In the event that the A/R Collections exceeds the A/R Amount (such excess
amount being referred to herein as an "A/R Balance"), the Buyer shall
deliver to the Seller within 30 days after the Determination Date a check
in an amount equal to the A/R Balance. If, as of the Determination Date,
the A/R Collections are less than the A/R Amount (such deficit being
referred to herein as the "A/R Shortfall"), the Seller shall pay the A/R
Shortfall to the Buyer by check in six equal monthly installments (the
first payment due 10 days after delivery of the Final Statement). The
parties hereto acknowledge and agree that after delivery of the Final
Statement and payment in full of the A/R Balance or A/R Shortfall, as the
case may be, neither party shall have any other obligation to the other
party with respect to the Accounts Receivable, except that all remaining
uncollected Accounts Receivable shall be turned over to the Seller for
disposition in such manner as the Seller, in its sole discretion, shall
determine.
(b) All payments by patients and third party payors shall be accounted
for on a first-in-first-out basis unless any such payment is identified as
a payment in respect of a particular invoice or otherwise is designated as
payment of a particular invoice or for a particular service.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1. Representations and Warranties of the Seller.
The Seller hereby represents and warrants to the Buyer, as of the date
hereof, as follows:
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(a) Organization; Good Standing; Qualification and Power. The Seller
is a professional corporation duly formed, validly existing and in good
standing under the laws of the Commonwealth of Pennsylvania and has all
requisite power and authority to own, lease and operate its properties and
to carry on its business as now being conducted and as proposed to be
conducted, to execute and deliver this Agreement, the Xxxx of Sale and the
Assignment and Assumption Agreement, to perform its obligations hereunder
and thereunder and to consummate the transactions contemplated hereby and
thereby. The Seller has delivered to the Buyer a true and correct copy of
its articles of incorporation and by-laws (collectively, the "Governance
Documents") as in effect on the date hereof.
(b) Authority. The execution, delivery and performance of this
Agreement, the Xxxx of Sale and the Assignment and Assumption Agreement and
the consummation of the transactions contemplated hereby and thereby have
been duly and validly authorized by all necessary action on the part of the
Seller. This Agreement, the Xxxx of Sale and the Assignment and Assumption
Agreement have been duly and validly executed and delivered by the Seller
and constitute legal, valid and binding obligations of the Seller
enforceable in accordance with their respective terms, except as
enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of
creditors generally. Neither the execution, delivery or performance by the
Seller of this Agreement, the Xxxx of Sale or the Assignment and Assumption
Agreement nor the consummation by the Seller of the transactions
contemplated hereby or thereby, nor compliance by the Seller with any
provision hereof or thereof will (i) conflict with or result in a breach of
any provision of the Governance Documents of the Seller, (ii) cause a
default (with due notice, lapse of time or both), or give rise to any right
of termination, cancellation or acceleration, under any of the terms,
conditions or provisions of any note, bond, lease, mortgage, indenture,
license or other
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instrument, obligation or agreement to which the Seller is a party or by
which it or any of its respective properties or assets may be bound or
(iii) violate any law, statute, rule or regulation or order, writ,
judgment, injunction or decree of any court, administrative agency or
governmental body applicable to the Seller or any of its respective
properties or assets. Except as set forth on Schedule 3.1(b), no permit,
authorization, consent or approval of or by, or any notification of or
filing with, any person (governmental or private) is required in connection
with the execution, delivery or performance by the Seller of this
Agreement, the Xxxx of Sale or the Assignment and Assumption Agreement or
the consummation of the transactions contemplated hereby or thereby.
(c) Title to Assets, Properties, Interests in Properties and Rights
and Related Matters.
(i) The Seller has good and valid title to all of the Purchased
Assets, free and clear of all security interests, judgments, liens,
pledges, claims, charges, escrows, encumbrances, easements, options,
rights of first refusal, rights of first offer, mortgages, indentures,
security agreements or other agreements, arrangements, contracts,
commitments, understandings or obligations, whether written or oral
and whether or not relating in any way to credit or the borrowing of
money (collectively, "Claims"), of any kind or character, except for
(A) those Claims set forth on Schedule 3.1(c) and (B) Permitted Liens.
(ii) There does not exist any condition which materially
interferes with the economic value or use (consistent with the
Seller's past practice) of any tangible personal property included in
the Purchased Assets and such property is in good operating condition
and repair, reasonable wear and tear excepted.
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(iii) The Seller has the complete and unrestricted power and the
unqualified right to sell, transfer, convey and assign, and the Seller
is hereby selling, transferring conveying and assigning to the Buyer,
the Purchased Assets, and this Agreement, the Xxxx of Sale and the
Assignment and Assumption Agreement are sufficient to sell, transfer,
convey and assign to the Buyer all right, title and interest of the
Seller in and to the Purchased Assets, free and clear of all Claims
(other than Permitted Liens) and to vest in the Buyer good and valid
title thereto.
(iv) As used in this Agreement, "Permitted Liens" shall mean (A)
any lien for current taxes not yet due and payable, (B) liens of
carriers, warehousemen, mechanics and materialmen created in the
ordinary course of the Subject Business for amounts not yet due and
payable which do not materially detract from the value or impair the
use of any property or assets, (C) in the case of Purchased Assets,
liens incurred in the ordinary course of the Subject Business
(including, without limitation, surety bonds and appeal bonds) in
connection with workers' compensation, unemployment insurance and
other types of social security benefits and (D) statutory landlord
liens securing rents not yet due and payable.
(d) Litigation. Except as set forth on Schedule 3.1(d), there are no
(i) actions, suits, claims, investigations or legal or administrative or
arbitration proceedings pending or, to the best knowledge of the Seller,
threatened against the Seller, the Purchased Assets or the Subject
Business, whether at law or in equity, or before or by any Federal, state,
municipal or other governmental department, commission, board, bureau,
agency or instrumentality or (ii) judgments, decrees, injunctions or orders
of any court, governmental department, commission, agency, instrumentality
or arbitrator against the Seller or affecting the Purchased Assets or the
Subject Business. The Seller has delivered to the Buyer all documents and
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correspondence relating to matters referred to in said Schedule 3.1(d).
(e) Compliance; Governmental Authorizations. The Seller has complied
in all material respects with all applicable Federal, state, local or
foreign laws, ordinances, regulations and orders. The Seller has all
Federal, state, local and foreign governmental licenses and permits
necessary in the conduct of the Subject Business the lack of which would
have a material adverse effect on the Seller's ability to operate the
Subject Business after the Closing Date on substantially the same basis as
presently operated, such licenses and permits are in full force and effect,
no violations are or have been recorded in respect of any thereof and no
proceeding is pending or threatened to revoke or limit any thereof. None of
such licenses and permits shall be affected in any material respect by the
transactions contemplated hereby.
(f) Disclosure. Neither this Agreement (including the Exhibits and
Schedules attached hereto), the Xxxx of Sale, the Assignment and Assumption
Agreement nor any other document, certificate or written statement
furnished to the Buyer by or on behalf of the Seller in connection with the
transactions contemplated hereby contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make
the statements contained herein and therein not misleading.
3.2. Representations and Warranties of the Buyer.
The Buyer represents and warrants to the Seller, as of the date hereof, as
follows:
(a) Organization, Good Standing and Power. The Buyer (i) is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, (ii) has all requisite corporate power and
authority to own, lease and operate its properties, to carry on its
business as now being
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conducted, to execute and deliver this Agreement and the Assignment and
Assumption Agreement, to perform its obligations hereunder and thereunder
and to consummate the transactions contemplated hereby and thereby.
(b) Authority. The execution, delivery and performance of this
Agreement and the Assignment and Assumption Agreement, and the consummation
of the transactions contemplated hereby and thereby, have been duly and
validly authorized by all necessary corporate action on the part of the
Buyer. This Agreement and the Assignment and Assumption Agreement have been
duly and validly executed and delivered by the Buyer, and constitute legal,
valid and binding obligations of the Buyer, enforceable in accordance with
their respective terms except as enforcement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally. Neither the execution,
delivery or performance by the Buyer of this Agreement or the Assignment
and Assumption Agreement nor the consummation by the Buyer of the
transactions contemplated hereby or thereby, nor compliance by the Buyer
with any provision hereof or thereof, will (i) conflict with or result in a
breach of any provisions of the Certificate of Incorporation or By-laws of
the Buyer, (ii) cause a default (with due notice, lapse of time or both),
or give rise to any right of termination, cancellation or acceleration,
under any of the terms, conditions or provisions of any material note,
bond, lease, mortgage, indenture, license or other instrument, obligation
or agreement to which the Buyer is a party or by which it or any of its
properties or assets is or may be bound or (iii) violate any law, statute,
rule or regulation or order, writ, judgment, injunction or decree of any
court, administrative agency or governmental body applicable to the Buyer
or any of its properties or assets. Except as set forth on Schedule 3.2(b),
no permit, authorization, consent or approval of or by, or any notification
of or filing with, any person (governmental or private) is required in
connection with the execution, delivery
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or performance by the Buyer of this Agreement or the Assignment and
Assumption Agreement or the consummation by the Buyer of the transactions
contemplated hereby or thereby.
ARTICLE IV
CONDITIONS TO CLOSING
4.1. Conditions to Each Party's Obligations.
The obligations of the Seller to sell the Purchased Assets, and of the
Buyer to purchase the Purchased Assets, are subject to the satisfaction of the
following conditions unless waived in writing (to the extent such conditions can
be waived) by the Seller or the Buyer, as applicable:
(a) Legal Action. No temporary restraining order, preliminary
injunction or permanent injunction or other order preventing the
consummation of the transactions contemplated hereby shall have been issued
by any Federal or state court and remain in effect. Each party agrees to
use its best efforts to have any such injunction or order lifted.
(b) Legislation. No Federal, state, local or foreign statute, rule or
regulation shall have been enacted which prohibits, restricts or delays the
consummation of the transactions contemplated by this Agreement or any of
the conditions to the consummation of such transactions.
(c) Related Agreements. Each of the related agreements identified in
Section 4.4 hereof (collectively, the "Related Agreements") shall have been
fully executed and delivered prior to or at the Closing by all of the
parties required to execute and deliver such agreements.
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4.2. Conditions to Obligations of the Buyer.
The obligation of the Buyer to purchase the Purchased Assets is subject to
the satisfaction of the following conditions unless waived in writing (to the
extent such conditions can be waived) by the Buyer:
(a) Representations and Warranties. The representations and warranties
of the Seller set forth in Section 3.1 shall in each case be true and
correct in all material respects as of the Closing Date and as of the
Signature Date as though made at and as of the Signature Date.
(b) Performance of Obligations. The Seller shall have performed all
obligations required to be performed by it under this Agreement prior to
and at the Closing.
(c) Authorization. All action necessary to authorize the execution,
delivery and performance of this Agreement, the Xxxx of Sale and the
Assignment and Assumption Agreement by the Seller and the consummation of
the transactions contemplated hereby and thereby shall have been duly and
validly taken by the Seller and the Seller shall have full power and right
to consummate the transactions contemplated hereby and thereby.
(d) Consents and Approvals. The Seller shall have delivered to the
Buyer duly executed copies of (i) consents to the assignment of the office
leases and equipment leases listed on Schedules 1.1(c) and 1.1(f) and (ii)
all other approvals, if any, required by this Agreement or the Schedules,
in each case in form and substance satisfactory to the Buyer and counsel to
the Buyer.
(e) Government Consents, Authorizations, Etc. All consents,
authorizations, orders or approvals of, and filings or registrations with,
any Federal, state, local or foreign governmental commission, board or
other regulatory body which are
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required for or in connection with the execution and delivery by the Seller
of this Agreement, the Xxxx of Sale and the Assignment and Assumption
Agreement and the consummation by the Seller of the transactions
contemplated hereby and thereby shall have been obtained or made.
4.3. Conditions to Obligations of the Seller.
The obligation of the Seller to sell the Purchased Assets to the Buyer is
subject to the satisfaction of the following conditions unless waived in writing
(to the extent such conditions can be waived) by the Seller:
(a) Representations and Warranties. The representations and warranties
of the Buyer set forth in Section 3.2 shall in each case be true and
correct in all material respects as of the Closing Date and as of the
Signature Date as though made at and as of the Signature Date.
(b) Performance of Obligations. The Buyer shall have performed all
obligations required to be performed by it under this Agreement prior to
and at the Closing.
(c) Authorization. All action necessary to authorize the execution,
delivery and performance of this Agreement and the Assignment and
Assumption Agreement by the Buyer and the consummation of the transactions
contemplated hereby and thereby shall have been duly and validly taken by
the Buyer.
(d) Government Consents, Authorizations, Etc. All consents,
authorizations, orders or approvals of, and filings or registrations with,
any Federal, state, local or foreign governmental commission, board or
other regulatory body which are required for or in connection with the
execution and delivery by the Buyer of this Agreement and the Assignment
and Assumption
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Agreement and the consummation by the Buyer of the transactions
contemplated hereby and thereby shall have been obtained or made.
4.4. Related Agreements.
The Related Agreements referred to in this Agreement consist of the
following:
(a) the Assignment of Office Leases, relating to each of the medical
office premises identified on Schedule 1.1(f), between the parties hereto;
(b) the Xxxx of Sale executed by the Seller; and
(c) the Assignment and Assumption Agreement between the Seller and the
Buyer.
ARTICLE V
CLOSING
5.1. Date.
The closing (the "Closing") for the consummation of the transactions
contemplated by this Agreement shall be deemed to have taken place at 12:01 a.m.
on the Closing Date, irrespective of the actual date(s) and time(s) that all of
the documents required hereunder are executed and delivered.
5.2. Closing Transactions.
At the Closing, the parties shall take the actions and deliver the
documents identified in this Section 5.2. The Closing shall not be deemed to
have taken place, and the transactions contemplated by this Agreement shall not
be deemed to have been consummated, unless all of the closing transactions
identified in this Section 5.2 have been completed or waived in writing by the
parties.
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(a) The Seller shall deliver to the Buyer an executed copy of the Xxxx
of Sale;
(b) Each of the parties shall execute and deliver to the other a copy
of the Assignment and Assumption Agreement;
(c) The Buyer shall deliver to the Seller a promissory note in the
principal amount of the Purchase Price payable by the Buyer to the Seller,
in substantially the form of Exhibit C attached hereto; and
(d) The Seller shall deliver to the Buyer a copy of the resolutions of
the Seller authorizing the transactions contemplated hereby, accompanied by
a certificate of the Seller stating that such resolutions have been duly
adopted in accordance with the Seller's Governance Documents.
ARTICLE VI
INDEMNIFICATION
6.1. Definitions.
As used in this Agreement, the following terms shall have the following
meanings:
(a) "Affiliate", as to any person, means any other person that,
directly or indirectly, through one or more intermediaries, controls, is
controlled by or is under common control with such person.
(b) "Buyer Indemnification Event" shall mean the following:
(i) (A) the untruth, inaccuracy or breach of any representation
or warranty of the Seller contained in this Agreement, any Schedule or
Exhibit attached hereto, the Xxxx of
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Sale, the Assignment and Assumption Agreement or any certificate
delivered by the Seller in connection herewith (or any facts or
circumstances constituting any such untruth, inaccuracy or breach) or
(B) the breach of any agreement or covenant of the Seller contained in
this Agreement, the Xxxx of Sale, or the Assumption or Assignment
Agreement;
(ii) the assertion against Buyer Indemnified Person of any
liability or obligation arising from, relating to, or in any way
connected with the operation of the Subject Business at any time prior
to the Closing;
(iii) the assertion against any Buyer Indemnified Person of any
liability or obligation arising from, relating to, or in any way
connected with any Excluded Obligation; and
(iv) any non-compliance by the Seller with any "bulk sales laws"
to the extent that such laws may be applicable to the transactions
contemplated hereby.
(c) "Buyer Indemnified Persons" shall mean and include the Buyer, its
Affiliates and their respective officers, directors, and employees.
(d) "Indemnified Persons" shall mean the Buyer Indemnified Persons or
the Seller Indemnified Persons, as the case may be.
(e) "Indemnifying Person" shall mean the Buyer or the Seller, as the
case may be.
(f) "Losses" shall mean any and all losses, claims, damages,
liabilities, expenses (including reasonable attorneys' and accountants'
fees), assessments, tax deficiencies and taxes (including interest or
penalties thereon) sustained,
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suffered or incurred by any Indemnified Person arising from any matter
which is the subject of indemnification under Section 6.2.
(g) "Seller Indemnification Event" shall mean (i) the untruth,
inaccuracy or breach of any representation or warranty of the Buyer
contained in this Agreement, any Schedule or Exhibit attached hereto, the
Assignment and Assumption Agreement or any certificate delivered by the
Buyer in connection herewith (or any facts or circumstances constituting
any such untruth, inaccuracy or breach) or (ii) the breach of any agreement
or covenant of the Buyer contained in this Agreement or the Assignment and
Assumption Agreement.
(h) "Seller Indemnified Persons" shall mean and include the Seller and
its partners and employees.
6.2. Indemnification Generally.
(a) The Seller shall indemnify, defend and hold harmless the Buyer
Indemnified Persons, and each of them, from and against any and all Losses
resulting from Buyer Indemnification Events.
(b) The Buyer shall indemnify, defend and hold harmless the Seller
Indemnified Persons, and each of them, from and against any and all Losses
resulting from Seller Indemnification Events.
6.3. Assertion of Claims.
No claim, demand, suit or cause of action shall be brought under Section
6.2 unless the Indemnified Persons, or any of them, give the Indemnifying Person
written notice of the existence of any such claim, demand, suit or cause of
action, stating with particularity the nature and basis of said claim, and the
amount thereof, to the extent known, and providing to the extent reasonably
available all written documentation relating
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thereto. Such written notice shall be delivered to the Indemnifying Person as
soon as practicable upon receipt of actual knowledge of such claim, demand, suit
or cause of action; provided, however, that the failure to provide such written
notice shall not affect the Indemnified Persons' right to indemnification
hereunder if failure to provide such written notice does not materially
adversely affect the Indemnifying Person. Upon the giving of such written notice
as aforesaid, the Indemnified Persons, or any of them, shall have the right to
commence legal proceedings subsequent to the applicable survival date, if any,
for the enforcement of their rights under Section 6.2.
6.4. Notice and Defense of Third Party Claims.
(a) In the event any action, suit or proceeding is brought by a third
party against an Indemnified Person, with respect to which an Indemnifying
Person may have liability under Section 6.2, the action, suit or proceeding
shall, upon the written agreement of the Indemnifying Person that it is
obligated with respect to such action, suit or proceeding, be defended
(including all proceedings on appeal or for review which counsel for the
defendant shall deem appropriate) and, unless otherwise provided below,
controlled by such Indemnifying Person. The Indemnified Persons shall have
the right to employ its or their own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such Indemnified
Persons, unless (i) the employment of such counsel shall have been
authorized in writing by the Indemnifying Person in connection with the
defense of such action, suit or proceeding, (ii) the Indemnifying Person
shall fail actively and diligently to defend such action, suit or
proceeding, (iii) the Indemnified Persons shall have reasonably concluded
that such action, suit or proceeding involves to a significant extent
matters beyond the scope of the indemnity agreement contained in Section
6.2 or (iv) the Indemnified Persons shall have reasonably concluded that
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there may be one or more legal or equitable defenses available to the
Indemnified Persons which are different from or additional to those
available to the Indemnifying Person, in any of which events the
Indemnifying Person shall not have the right to direct the defense of such
action, suit or proceeding on behalf of the Indemnified Persons and that
portion of any fees and expenses of counsel related to matters covered by
the indemnity agreement and contained in Section 6.2 shall be borne by the
Indemnifying Person. The Indemnified Persons shall be kept fully informed
of such action, suit or proceeding at all stages thereof whether or not
they are so represented. The Indemnifying Person shall make available to
the Indemnified Persons and their attorneys and accountants all books and
records of the Indemnifying Person relating to such action, suit or
proceeding and the parties hereto agree to render to each other such
assistance as they may reasonably require of each other in order to ensure
the proper and adequate defense of any such action, suit or proceeding.
(b) The Indemnifying Person shall not make any settlement of any
action, suit or proceeding without the written consent of the Indemnified
Persons, which consent shall not be unreasonably withheld; provided,
however, that in the event the Indemnified Persons refuse to consent to a
settlement acceptable to the Indemnifying Person which is capable of
settlement by the payment of money only and the Indemnifying Persons shall
demonstrate to the reasonable satisfaction of the Indemnified Persons their
ability to pay such amount, the Indemnifying Person may pay the amount of
the proposed settlement to the Indemnified Persons and shall thereupon be
released from any further liability with respect to such action, suit or
proceeding.
6.5. Survival of Representations, Warranties and Covenants.
The representations and warranties of the Seller contained in Section 3.1
and the representations and warranties of the Buyer contained in Section 3.2
shall survive the Closing
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and shall terminate forty-five (45) days following the second anniversary of the
Signature Date; provided, however, that the representations and warranties of
the Seller set forth in Sections 3.1(a), 3.1(b), 3.1(c) and 3.1(e), and the
representations and warranties of the Buyer set forth in Sections 3.2(a) and
3.2(b), shall survive the Closing and remain in full force and effect until the
expiration of the statute of limitations, if any, applicable to the matters set
forth therein (and indefinitely, if none).
ARTICLE VII
AMENDMENT, MODIFICATION AND WAIVER
This Agreement shall not be altered or otherwise amended except pursuant to
an instrument in writing signed by each of the parties. The waiver by one party
of the performance of any covenant, condition or promise shall not invalidate
this Agreement, nor shall it be considered as a waiver by such party of any
other covenant, condition or promise. The delay in pursuing any remedy or in
insisting upon full performance for any breach or failure of any covenant,
condition or promise shall not prevent a party from later pursuing any remedies
or insisting upon full performance for the same or any similar breach or
failure.
ARTICLE VIII
MISCELLANEOUS
8.1. Transfer Taxes, Etc.
The Seller shall pay all sales, use and excise taxes and all registration,
recording or transfer taxes which may be
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payable in connection with the transactions contemplated by this Agreement.
8.2. Entire Agreement.
This Agreement (including the recitals hereof and the Schedules and the
Exhibits attached hereto), together with the Related Agreements referenced
herein, contains the entire agreement between the parties hereto with respect to
the transactions contemplated hereby and supersedes all prior agreements,
representations, warranties and understandings, either oral or written, between
the parties with respect thereto.
8.3. Descriptive Headings.
Descriptive headings are for convenience only and shall not control or
affect the meaning or construction of any provisions of this Agreement.
8.4. Notices.
All notices or other communications which are required or permitted
hereunder shall be in writing and sufficient if delivered personally or sent by
telecopier, nationally-recognized overnight courier, or certified mail, postage
prepaid, return receipt requested, addressed as follows:
(a) if to the Buyer, to:
BMJ Medical Management, Inc.
0000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxx 000X
Xxxx Xxxxx, Xxxxxxx 00000
Attention: President
Telecopier: (000) 000-0000;
with a copy to:
X'Xxxxxxxx Graev & Karabell, LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Held, Esq.
Telecopier: (000) 000-0000; and
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(b) if to the Seller, to:
Valley Sports & Arthritis Surgeons, P.C.
0000 Xxxxx Xxxxx Xxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxx, M.D.
Telecopier: (000) 000-0000;
with a copy to:
Xxxxxxxx, Xxxxxx & Xxxxx
700 Mellon Bank Center
0 Xxxx Xxxxxx Xxxxxx
Xxxxxx-Xxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxx, Esq.
Telecopier: (000) 000-0000;
or to such other address as the party to whom notice is to be given may have
furnished to each other party in writing in accordance herewith. Any such
communication shall be deemed to have been given (i) when delivered if
personally delivered or sent by telecopier, (ii) on the Business Day after
dispatch if sent by nationally-recognized, overnight courier and (iii) on the
fifth Business Day after dispatch, if sent by mail. As used herein, "Business
Day" means a day that is not a Saturday, Sunday or a day on which banking
institutions in the Commonwealth of Pennsylvania are not required to be open.
8.5. Counterparts.
This Agreement may be executed in any number of counterparts, and each such
counterpart shall be deemed to be an original instrument, but all such
counterparts together shall constitute but one agreement.
8.6. Bulk Sales Compliance.
The Buyer hereby waives compliance by the Seller with the provisions of the
"bulk sales laws" of any state which may be applicable to the transactions
contemplated hereby; provided, however, that the Seller shall indemnify the
Buyer in connection
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with such noncompliance to the extent provided in Article 6 hereof.
8.7. Governing Law.
This Agreement shall be governed by and construed and enforced in
accordance with the laws of the Commonwealth of Pennsylvania without giving
effect to the laws and principles thereof, or of any other jurisdiction, which
would direct the application of the laws of another jurisdiction.
8.8. Attorneys' Fees.
In the event of any dispute or controversy arising out of or relating to
this Agreement, the prevailing party shall be entitled to recover from the other
party all costs and expenses, including attorneys' fees and accountants' fees,
incurred in connection with such dispute or controversy.
8.9. Benefits of Agreement.
The terms and provisions of this Agreement shall be binding upon and inure
to the benefit of the parties and their respective successors and permitted
assigns. Anything contained herein to the contrary notwithstanding, this
Agreement shall not be assignable by any party without the consent of the other
party hereto, and any purported assignment without such consent shall be null
and void.
8.10. Pronouns.
As used herein, all pronouns shall include the masculine, feminine, neuter,
singular and plural thereof whenever the context and facts require such
construction.
* * * *
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IN WITNESS WHEREOF, each of the parties hereto has caused this Asset
Purchase Agreement to be executed on its behalf effective as of the day and year
first above written.
BMJ MEDICAL MANAGEMENT, INC.
By:____________________________
Name:
Title:
VALLEY SPORTS & ARTHRITIS SURGEONS, P.C.
By:______________________________
Name:
Title:
