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STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made and entered
into as of July ____, 1996, by and between DCAmerica Inc., a Delaware
corporation, ("Seller") and Capstone Pharmacy Services, Inc., a Delaware
corporation ("Buyer").
WITNESSETH:
WHEREAS, Seller owns one hundred percent (100%) of the capital stock
(the "Stock") of DCMed Inc., a Delaware corporation (the "Corporation" or
"DCMed"); and
WHEREAS, DCMed owns one hundred percent (100%) of the capital stock of
MediDyne Corp., a New Jersey corporation ("MediDyne") that owns and operates a
Medicare Part B business specializing in providing products and services to
patients in long-term care facilities and at home (the "Business"); and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, the
Stock.
NOW, THEREFORE, in consideration of the premises, and the mutual
covenants contained in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties, intending to be legally bound hereby agree as follows:
ARTICLE 1
PURCHASE AND SALE OF STOCK
1.1 Stock to be Purchased. On Closing, Seller agrees to sell,
transfer, convey, assign and deliver to Buyer, and Buyer agrees to purchase,
acquire and accept from Seller, all of the Stock free and clear of all claims,
liens, restrictions, suits, proceedings, calls, proxies, charges, options,
security interests, and encumbrances of any kind.
1.2 Assets at Closing. At Closing DCMed shall own or lease, as
specified, all assets used to operate the Business, either directly or through
MediDyne, including, without limitation, the following:
(a) All of the assets purchased by Seller pursuant to the
January 1, 1996 Asset Purchase Agreement dated January 1, 1996, by and among
MediQuest, Inc., Xxxxxxx Xxxxxxxxxxx, Xxxxx Xxxxxxxxx and Seller, that were
assigned by Seller to MediDyne pursuant to an Assignment and Assumption
Agreement dated January 1, 1996 (the "Purchase Date") (except for those assets
previously conveyed by Seller to Buyer or those assets that have been used or
sold in the ordinary course of business);
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(b) All of the assets purchased by MediDyne pursuant to
the April 30, 1996 Asset Purchase Agreement dated April 30, 1996, by and among
Medical Biotics Corp., as Seller, Xxxxxxxx Xxxxxxxxx, Xx., as Shareholder, and
MediDyne as Buyer (except for those assets that have been used or sold in the
ordinary course of business);
(c) All tangible personal property, medical and other
equipment, machinery, data processing and computer hardware and software,
furniture, furnishings, appliances, vehicles and other tangible personal
property of every description and kind and all replacement parts therefor which
are either owned by MediDyne or used or maintained or operated by MediDyne in
connection with its Business (collectively the "Equipment and Furnishings");
(d) All inventory of goods and supplies used or
maintained in connection with MediDyne's business (collectively the
"Inventory");
(e) All accounts and notes receivable of MediDyne;
(f) All patient, medical, personnel and other records of
DCMed or MediDyne;
(g) To the extent transferable, all licenses, permits,
registrations, certificates, consents, accreditations, approvals and franchises
necessary to construct, operate and conduct the business, together with
assignments thereof, if required, and all waivers which DCMed or MediDyne
currently has, if any, of any requirements pertaining to such licenses,
permits, registrations, certificates, consents, accreditations, approvals and
franchises;
(h) The name "MediDyne";
(i) All of DCMed's and MediDyne's rights and interests
pursuant to any contracts to which they are a party, including, without
limitation, noncompetition agreements, leases, and contracts for purchase, sale
or lease of goods or services currently furnished or to be furnished at or to
its business;
(j) All intellectual property and other intangibles of
DCMed or MediDyne; and
(k) All trademarks, service marks, trade names, labels or
other trade rights of DCMed or MediDyne.
The properties and assets hereinabove described are hereinafter collectively
referred to as the "Assets".
1.3 Assumption of Obligations. At Closing the Corporation will
retain and continue to be liable for, and subject to, all of the contracts,
leases, notes payable, accounts payable, commitments and agreements of the
Corporation (the "Assumed Obligations") except for those excluded obligations
listed on Schedule 1.3 hereof, and except for liability for suits, claims,
indemnities, taxes (and any penalties and interest and defense costs related
thereto), contingent liabilities and other obligations of the Corporation the
basis for which occurred prior to the Effective
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Date and during the time that the Seller owned the asset giving rise to such
liability (collectively, the "Excluded Obligations").
1.4 Assets and Liabilities. By virtue of this transaction, Seller
represents that the Corporation shall own and retain the Assets free of all
liens, restrictions and encumbrances and the Corporation shall not retain or
assume or be liable for any liabilities, claims or obligations except for the
Assumed Obligations.
1.5 Delivery of Common Stock. Seller shall deliver to Buyer at
Closing all stock certificates representing the Stock, duly endorsed for
transfer or accompanied by duly executed stock powers. The Stock will be
conveyed to Buyer fully paid and nonassessable with good and valid title, free
and clear of all liens, charges, claims, liabilities, encumbrances, security
interest, restrictive agreements, options, rights of others and imperfections
of title of any nature whatsoever with respect thereto (except for standard
restrictions imposed by federal and state securities laws, if any) including
all amounts due and payable for federal, state and local transfer taxes.
1.6 Closing. The Closing under this Agreement shall take place at
the offices of Xxxxxxx Xxxxxx Xxxx Xxxxxxx & Manner, P.C. as soon as possible
after the parties satisfy the conditions precedent to Closing, or at such other
time and place as Buyer and Seller shall mutually agree in writing. Upon
consummation, Closing and the transfer of Stock to Buyer shall be deemed to be
effective at the opening of business on July 1, 1996 (the "Effective Date").
Seller shall be liable for the risk of loss through the date of Closing.
1.7 Purchase Price. The purchase price payable by Buyer to Seller
for the Stock (the "Purchase Price") is set forth in Schedule 1.7 to this
Agreement and shall be paid in cash on the final closing date, which shall
occur no later than ten (10) business days of Closing.
1.8 Post-Closing Adjustment. On March 1, 1997, or such later date
as the parties mutually agree or is necessary to resolve the dispute described
on Schedule 2.9, (the "Post-Closing Date") the parties hereby agree that that
portion of Medidyne's business represented by Medical Biotics will be valued in
accordance with the method and accounting principles used to value Medical
Biotics as of the date of its purchase by Medidyne, and Buyer shall pay to
Seller upon Seller's agreement with said valuation, within ten (10) business
days of the Post-Closing Date, any amount by which said valuation exceeds
$1,000,000, up to an additional maximum earnout of $422,000, minus any
unreimbursed costs or expenses incurred by Buyer in connection with the dispute
described on Schedule 2.9. In the event the Buyer and Seller are not able to
reach agreement concerning the valuation within ten (10) days of the
Post-Closing Date, any claim or dispute shall be resolved in accordance with
the procedure described in Section 7.4(b) of this agreement.
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ARTICLE 2
SELLER'S REPRESENTATIONS AND WARRANTIES
As an inducement to Buyer to enter into this Agreement and to perform
the transactions contemplated hereby, Seller represents and warrants to Buyer
that the following shall be true and correct on the date of the Closing:
2.1 Organization and Standing. The Corporation is duly organized,
validly existing and in good standing under the laws of Delaware. MediDyne was
organized and is validly existing and in good standing under the laws of New
Jersey. The Corporation has all requisite corporate power and authority to
own, operate and lease its properties including the Assets and to carry on its
business in the manner now being conducted. The only shareholder of the
Corporation is Seller. Except for the stock of MediDyne the Corporation owns
no capital stock of any other corporation, or any security or option
convertible into the capital stock of any corporation or partnership or joint
venture interest in any partnership, joint venture or business enterprise.
2.2 Authority. The execution and delivery of this Agreement and
each other agreement or instrument pursuant hereto, and the performance by each
of Seller, the Corporation and MediDyne of its obligations hereunder are within
its authority, have been duly authorized by proper corporate proceedings, and
will not contravene or constitute a default under or with respect to the
Charter or By-Laws of each of Seller, the Corporation and MediDyne or of any
agreement, judgment, order or other instrument binding upon or relating to each
of Seller, the Corporation and MediDyne.
2.3 Capitalization and Stock Ownership. All issued and
outstanding shares of stock of the Corporation and MediDyne have been duly
authorized, validly issued and are fully paid and nonassessable and are owned
free and clear of any liens, charges, encumbrances, security interests, pledges
or any other restrictions whatsoever. At Closing, neither the Corporation nor
MediDyne shall have outstanding subscriptions, options, warrants, calls,
contracts, convertible securities or other instruments, agreements or
arrangements of any character or nature whatsoever under which either such
entity is or may be obligated or compelled to issue any capital stock, any
shares of any class of preferred stock or any other securities of any kind, or
to transfer or modify any right with respect to outstanding shares and no one
has any pre-emptive rights, rights of first refusal or similar rights with
respect to equity interest or stock of the Corporation or MediDyne. Neither
Seller nor the Corporation is a party to, and there exist no voting trusts,
shareholders' agreements, pledge agreements or other agreements relating to or
restricting the transferability of any shares of the stock or equity interests
of the Corporation.
2.4 Financial Statements.
(a) Annexed hereto as Schedule 2.4(a) are the
consolidated balance sheet and related statements of income for Mediquest for
the year ended December 31, 1996, (collectively, the "Financial Statements").
The Financial Statements are, to Seller's knowledge, fair, accurate
presentations of the financial condition of Mediquest and the results of
operations of the Mediquest as of the respective dates and for the respective
periods indicated. Except as disclosed on Schedule
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2.4(a), the Financial Statements have been prepared, to Seller's knowledge, in
accordance with generally accepted accounting principles consistently applied
and disclose all liabilities, whether absolute, accrued, contingent, liquidated
or unliquidated, matured or not yet due; including tax liabilities or otherwise
existing as of the respective dates. There exists, to Seller's knowledge, no
basis for the assertion of any liability or obligation not adequately reflected
in the Financial Statements. The Financial Statements contain, to Seller's
knowledge, no untrue or misleading statements and do not omit anything that
would cause them to be misleading or inaccurate in any material respect.
(b) Prior to Closing, Seller shall deliver unaudited
financial statements as of and for the three months ended March 31, 1996 (the
"Interim Financial Statements") for Medidyne and shall make any and all books
and records of the Corporation available to Buyer and Buyer's auditors and
Buyer's lender at reasonable times, and after Closing Seller shall cooperate
with Buyer in order to permit Buyer to conduct an audit of the Corporation's
financial statements for any period prior to Closing not already audited. Such
audit, if any, shall be at Buyer's expense. The books and records of the
Corporation are in such order and completeness so that an unqualified audit may
be performed for such periods.
(c) Neither the Corporation nor MediDyne has incurred
liabilities since the Purchase Date, directly or indirectly, whether absolute,
contingent or fixed, liquidated or unliquidated, matured or not yet due, of any
nature, including tax liabilities, except as specified in the Financial
Statements.
2.5 Property.
(a) Schedule 2.5(a) sets forth (i) a true and correct
copy of each and every lease of real property to which the Corporation or
MediDyne is a party; and (ii) a description of all other interests, if any, in
real property owned or leased by the Corporation or MediDyne.
(b) Schedule 2.5(b) sets forth a list and description of
all Equipment and Furnishings leased by the Corporation or MediDyne with a true
and correct copy of each such lease. The Equipment and Furnishings are all of
the equipment and furnishings used in the Business, and none of the Equipment
and Furnishings is obsolete or otherwise unusable in the operation of the
Business.
(c) All leases listed or described in Schedule 2.5(a) and
2.5(b) were validly entered into and are enforceable against the lessor. The
Corporation and, to the knowledge of Seller, each respective lessor identified
in any such lease, is not in default under the terms of any such lease, and no
event has occurred which with notice, the lapse of time or any action could
result in a default by the Corporation or, to the knowledge of Seller, any
lessor under the terms of any such lease.
(d) The Corporation or MediDyne has good and marketable
title to all of the Assets except for the leased Assets, free and clear of all
liens, security interests, financing statements, mortgages, conditional sale or
other title retention agreements, assessments, covenants, restrictions,
reservations, claims and encumbrances.
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2.6 Licenses and Permits. The Corporation and MediDyne have all
necessary or required approvals, certificates of need, licenses, permits,
registrations, agreements, instruments, documentation, authorizations and
certificates (whether federal, state or local) necessary to conduct its
business.
2.7 Filing Reports. All returns, reports, plans and filings of
any kind or nature required to be filed by the Corporation and MediDyne since
the Purchase Date with all federal, state or local governmental authorities
(the "Reports") have been properly completed and timely filed in compliance
with all applicable requirements. Each such Report contains no untrue or
misleading statements and does not omit anything which would cause it to be
misleading or inaccurate in any respect.
2.8 Absence of Default. Upon receipt of the consents specified in
Schedule 2.8, the execution, delivery and consummation of this Agreement and
all other agreements and documents executed in connection herewith by the
Corporation or Seller will not constitute a violation of, or be in conflict
with, and will not, with or without the giving of notice or the passage of
time, or both, result in a breach of, constitute a default under, or create (or
cause the acceleration of the maturity of) any debt, indenture, obligation or
liability affecting the Assets, or result in the creating of imposition of any
security interest, lien, charge or other encumbrance upon any of the Assets
with respect to:
(a) any term of provision of the Articles of Incorporation or
corporate Bylaws of the Corporation;
(b) any contract, lease, agreement, indenture, mortgage,
pledge, assignment, permit, license, approval or other commitment to which the
Corporation or Seller are a party or by which the Corporation or Seller are
bound;
(c) any judgment, decree, order, regulation or rule of any
court or regulatory authority; or
(d) any law, statute, rule, regulation, order, writ,
injunction, judgment or decree of any court or governmental authority or
arbitration tribunal to which Seller or the Corporation is subject. Except for
the consents obtained pursuant to Section 4.5, no approval, consent or
authorization of any federal, state or local governmental or regulatory agency
or any other third party is required in connection with the execution, delivery
or performance of this Agreement or the consummation of the transactions
contemplated by this Agreement.
2.9 No Litigation or Adverse Events. Except as disclosed on
Schedule 2.9, there is no suit, claim, action, or legal, administrative,
arbitration, or other proceeding or governmental investigation pending or
threatened (and no fact or facts exist which could result in any such claim,
action, proceeding or investigation) by or against the Corporation, and no
event or condition of any character pertaining to the Corporation, MediDyne,
the Assets, the Stock or Seller exist that could (1) prevent the consummation
of the transaction contemplated by this Agreement, (2) either individually or
in the aggregate, materially adversely affect Buyer's ownership, enjoyment or
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operation of the Stock or the Corporation's operation of the Assets, or (3)
either individually or in the aggregate, materially diminish the value of the
Corporation or Assets as a going concern.
2.10 Broker's Fees. No broker, agent, finder or investment bank or
other person is entitled to any brokerage, finder or other fee or commission
from Seller, the Corporation or MediDyne in connection with the transactions
contemplated by this Agreement.
2.11 Environmental Matters. There are no past, existing or
potential violations of federal, state or local laws or regulations relating to
environmental protection or to storage, handling or disposal of hazardous
wastes, nor any potential for assessments or liability relating thereto,
affecting the Assets. There are no underground storage tanks at property
owned, leased or operated by the Corporation.
2.12 Bankruptcy, Etc. Neither the Corporation nor Seller is
involved in any proceedings in any court under any bankruptcy law or any other
insolvency or debtors' relief law, whether federal or state, or for the
appointment of a trustee, receiver, liquidator, assignee, sequestrator or other
similar official.
2.13 Referral Payments. Neither the Corporation nor Seller has
engaged in any practice or procedure which results in the payment by, or on
behalf of, the Corporation to a person or entity in connection with a patient
referral to the Corporation by such person or entity that is in violation of
any state or federal rule, regulation or law.
2.14 Disclosure. No representation or warranty by Seller in this
Agreement, nor any document, statement, certificate, or schedule furnished to
or to be furnished or made by Seller pursuant hereto, or in connection with the
transaction contemplated hereby, contains or will contain any untrue statement
of fact, or omits or will omit to state a fact necessary to make the statement
of facts contained herein and therein not misleading.
2.15 No Omissions or Misstatements. None of the representations,
warranties, covenants or other information in this Agreement and Schedules
hereto, contains any untrue statement of a material fact, or is misleading in
any material respect, or omits to state any material fact necessary in order to
make any of the statements herein or therein not misleading in light of the
circumstances in which they were made.
ARTICLE 3
BUYER'S REPRESENTATIONS AND WARRANTIES
As an inducement to Seller to enter into this Agreement and
transactions contemplated hereby, Buyer represents and warrants to Seller as
follows:
3.1 Organization. Buyer is a corporation duly authorized, validly
existing and in good standing under the laws of Delaware.
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3.2 Authority. The execution and delivery of this Agreement and
each other agreement or instrument pursuant hereto, and the performance by
Buyer of its obligations hereunder are within its authority, have been duly
authorized by proper corporate proceedings, and will not contravene or
constitute a default under or with respect to the Charter or By-Laws of Buyer
or of any agreement, judgment, order or other instrument binding upon or
relating to Buyer.
3.3 Broker's Fees. No broker, agent, finder or investment bank or
other person is entitled to any brokerage, finder or other fee or commission
from Buyer in connection with the transactions contemplated by this Agreement.
3.4 Bankruptcy. Buyer is not involved as a debtor in any
proceedings in any court under any bankruptcy law or other insolvency or
debtor's relief law, whether federal or state or for the appointment of a
trustee receiver, liquidation, assignee, sequestrator or other similar
official.
ARTICLE 4
CONDITIONS TO BUYER'S OBLIGATIONS TO CLOSE
Buyer's obligation to close shall be subject to the satisfaction of
the following conditions prior to or at Closing, unless waived in writing by
Buyer.
4.1 Representations and Warranties True at Closing. The
representations and warranties made by Seller in this Agreement shall be true
in all respects on and as of Closing with the same effect as though such
representations and warranties had been made or given on and as of Closing.
4.2 Authority and Government Approvals. Buyer shall have obtained
such licenses, permits, approvals and other authorizations from all applicable
federal, state and local agencies or others that are necessary to purchase the
Assets, and for Buyer through the Corporation to operate the Assets in the same
manner and on the same conditions as is currently operated by the Corporation.
4.3 Inspection of Assets. Buyer and its representatives shall
have had and continue to have reasonable rights of inspection of the Assets and
operations of the Corporation.
4.4 Approval by Buyer's Disinterested Directors. Those directors
of Buyer having no direct or indirect interest in DCAmerica shall have approved
of this acquisition.
4.5 Third Party Consents. Seller shall deliver to Buyer any
consents, approvals and authorizations of third parties which are necessary in
the reasonable opinion of Buyer for the execution, delivery and consummation of
this Agreement, including without limitation, those necessary for the
assignment of Service Agreements and the Leases and Contracts included in the
Assumed Obligations.
4.6 Possession. Seller shall deliver to Buyer full possession and
control of the Assets.
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4.7 Assumption of Liabilities. Seller shall assume and covenant
to fully perform and comply with all of the obligations of the Corporation
except the Assumed Obligations by instruments reasonably acceptable to Buyer
and Buyer's counsel.
4.8 Consent. Buyer's obligations set forth in this agreement are
conditioned on it obtaining consent from its primary lender.
ARTICLE 5
CONDITIONS TO SELLER'S OBLIGATIONS TO CLOSE
Seller's obligations to close shall be subject to the satisfaction of
the following conditions prior to or at Closing, unless waived in writing by
Seller:
5.1 Representations and Warranties True at Closing. The
representations and warranties made by Buyer in this Agreement shall be true in
all respects on and as of Closing with the same effect as though such
representations and warranties had been made or given on and as of Closing.
5.2 Approval of Legal Matters. The form of certificates,
instruments and documents to be executed and/or delivered by Buyer to Seller
pursuant to this Agreement and all legal matters with respect to the
transaction as herein contemplated shall be reasonably satisfactory to Seller's
counsel, whose approval shall not be unreasonably withheld or delayed.
ARTICLE 6
DOCUMENTS AT CLOSING; POST CLOSING
6.1 Delivery of Documents by Seller. At Closing, Seller
shall deliver to Buyer the following:
(a) Stock Certificates duly endorsed by Seller, or with
stock powers attached, representing all of the shares of Stock, which Seller
represents constitutes all of the issued and outstanding capital stock and
equity interest of the Corporation on Closing.
(c) The resignation of each member of the Board of
Directors and all the officers of the Corporation and MediDyne effective as of
Closing, except for such directors and officers as may be designated in writing
by Buyer prior to Closing.
(d) All corporate minute books, seals, stock transfer
books and all records of the Corporation and MediDyne and their respective
predecessors.
(e) The right to immediate possession of all real
property and all personal property owned or leased by the Corporation.
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(f) All permits, certificates of need, licenses,
authorizations and approvals in connection with the consummation of the
transactions contemplated hereunder that are transferrable under applicable law
as at Closing.
6.2 Delivery by Buyer. At Closing, or within five (5) business
days following Closing, Buyer shall deliver to Seller the Purchase Price.
ARTICLE 7
SURVIVAL OF PROVISIONS AND INDEMNIFICATION
7.1 Survival. The covenants, obligations, representations and
warranties of Buyer and Seller contained in this Agreement or any certificate
or document delivered pursuant hereto shall be deemed to be material and to
have been relied upon by the parties hereto notwithstanding any investigation
prior to Closing and shall survive for a period of two years from the date of
Closing and shall not be merged into any deeds or other documents delivered in
connection with Closing.
7.2 Indemnification by Seller. Subject to Section 7.7, Seller
promptly shall indemnify, defend and hold harmless the Corporation and Buyer
and the directors, officers, shareholders, employees and agents of the
Corporation and Buyer (and with respect to the COBRA coverage, the Corporation
and Buyer and all affiliated corporation within a controlled group relationship
with Buyer (as determined under Section 414 of the Internal Revenue Code), and
their employees) against any and all loss, cost, and expenses (including
reasonable cost of investigation, court costs and legal fees) and other damages
resulting from (i) any breach by Seller of any of its covenants, obligations,
representations or warranties or breach or untruth of any covenant, obligation,
representation, warranty, fact or conclusion contained in this Agreement or any
certificate or document of Seller delivered pursuant to this Agreement, and
(ii) any claim (whether or not disclosed herein), including any claim related
to the matter disclosed on Schedule 2.9, that is brought or asserted by any
third party(s) against Buyer, Medidyne, or the Corporation arising out of the
ownership, licensing, operation, action, inaction or conduct of the Seller or
arising out of the Corporation's or Medidyne's ownership, licensing, operation
of the Assets during the xxxx Xxxxxx owned the Corporation, and (iii) any claim
(whether or not disclosed herein) that is brought or asserted by any third
party(s) against Buyer, the Corporation, or Medidyne arising out of the
action(s) of Seller's employees, agents or independent contractors, relating to
all periods of time prior to the Effective Date, except the Assumed
Liabilities. Any indemnification payment pursuant to the foregoing shall
include interest at a floating rate equal to two points over the prime rate of
NationsBank of Tennessee, N.A., from time to time, (the "Rate") from the date
the loss, costs, expenses or damages were incurred until the date of payment.
7.3 Indemnification by Buyer. Subject to Section 7.7, Buyer and
the Corporation, jointly and severally, shall promptly indemnify, defend, and
hold harmless Seller against any and all loss, costs, and expenses (including
reasonable cost of investigation, court costs and legal fees) and other damages
resulting from (i) any breach by Buyer of any of its covenants, obligations,
representations or warranties or breach or untruth of any covenant, obligation,
representation, warranty, fact or
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conclusion contained in this Agreement or any certificate or document of Buyer
delivered pursuant to this Agreement, (ii) any claim which is brought or
asserted by any third party(s) against Seller for failure to pay or perform any
of the Assumed Liabilities, and (iii) any claim (whether or not disclosed
herein) which is brought or asserted by any third party(s) against Seller
arising out of the ownership, licensing, operation, action, inaction or conduct
of Buyer or the Corporation or Buyer's employees, agents or independent
contractors, relating to all periods of time following the Effective Date. Any
indemnification payment pursuant to the foregoing shall include interest at the
Rate from the date of the loss, costs, expenses or damages were incurred until
the date of payment.
7.4 Rules Regarding Indemnification. The obligations and
liabilities of each party which may be subject to indemnification liability
hereunder (the "indemnifying party") to the other party (the "indemnified
party") shall be subject to the following terms and conditions:
(a) Claims by Non-parties. The indemnified party shall
give written notice within a reasonably prompt period of time to the
indemnifying party of any written claim by a third party which is likely to
give rise to a claim by the indemnified party against the indemnifying party
based on the indemnity agreements contained in this Article, stating the nature
and basis of said claim and the amount thereof, to the extent known. The
indemnified party shall give notice to the indemnifying party that pursuant to
the indemnity, the indemnified party is asserting against the indemnifying
party a claim with respect to a potential loss from the third party claim, and
such notice shall constitute the assertion of a claim for indemnity by the
indemnified party. If, within thirty (30) days after receiving such notice,
the indemnifying party advises the indemnified party that it will provide
indemnification and assume the defense at its expense, then so long as such
defense is being conducted, the indemnified party shall not settle or admit
liability with respect to the claim and shall afford to the indemnifying party
and defending counsel all reasonable assistance in defending against the claim.
If the indemnifying party assumes the defense, counsel shall be selected by
such party and if the indemnified party then retains its own counsel, it shall
do so at its own expense. If the indemnified party does not receive a written
objection to the notice from the indemnifying party within 30 days after the
indemnifying party's receipt of such notice, the claim for indemnity shall be
conclusively presumed to have been assented to and approved, and in such case
the indemnified party may control the defense of the matter or case and, at its
sole discretion, settle or admit liability. If within the aforesaid 30 day
period the indemnified party shall have received written objection to a claim
(which written objection shall briefly describe the basis of the objection to
the claim or the amount thereof, all in good faith), then for a period of ten
(10) days after receipt of such objection the parties shall attempt to settle
the dispute as between the indemnified and indemnifying parties. If they are
unable to settle the disputed claim, the unresolved issue or issues shall be
settled by arbitration in accordance with the rules and procedures of the
American Arbitration Association.
(b) Claims by a Party. The determination of a claim
asserted by a party hereunder (other than as set forth in subsection (a) above)
pursuant to this shall be made as follows: The indemnified party shall give
written notice within a reasonably prompt period of time to the indemnifying
party of any claim by the indemnified party which has not been made pursuant to
subsection (a) above, stating the nature and basis of such claim and the amount
thereof, to the extent known. The claim shall be deemed to have resulted in a
determination in favor of the indemnified party and to have resulted in a
liability of the indemnifying party in an amount equal to the amount
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of such claim estimated pursuant to this Section if within forty-five (45) days
after the indemnifying party's receipt of the claim the indemnified party shall
not have received written objection to the claim. In such event, the claim
shall be conclusively presumed to have been assented to and approved. If
within the aforesaid forty-five (45) day period the indemnified party shall
have received written objection to a claim (which written objection shall
briefly describe the basis of the objection to the claim or the amount thereof,
all in good faith), then for a period of sixty (60) days after receipt of such
objection the parties shall attempt to settle the disputed claim as between the
indemnified and indemnifying parties. If they are unable to settle the
disputed claim, the unresolved issue or issues shall be settled by arbitration
in accordance with the rules and procedures of the American Arbitration
Association.
7.5 Assignment by Buyer. No consent by Seller shall be required
for any assignment or reassignment of the rights of Buyer under this Article.
7.6 Corporation Not Liable. Notwithstanding anything to the
contrary contained in this Agreement, the indemnification obligations under
Section 7.2 are solely that of Seller, and are not the obligations of the
Corporation (since after Closing the Corporation will be owned by Buyer).
Seller will not seek contribution, recourse or redress of any kind against the
Corporation in connection with any indemnification obligations whether pursuant
to corporate law or contractual rights of Seller except for rights under
Section 7.3.
7.7 Limitation on Indemnification. No party shall be entitled to
indemnification beyond its damages and expenses. It is expressly understood
and agreed by the parties hereto, without regard to the representations and
warranties made herein, that Seller shall not be liable for and Buyer shall not
be entitled to indemnification with respect to any liability arising from facts
or events related to the ownership or operation of the Business before the
purchase Date except as known by Seller as of the Closing date and not
disclosed herein. Seller's obligations under this Article shall in no event
exceed the Purchase Price.
ARTICLE 8
MISCELLANEOUS
8.1 Notices. Any notice or other communication required or
permitted to be given hereunder shall be deemed to have been properly given
upon personal delivery, or three days after deposit when deposited in the
United States mails if mailed by certified mail, postage prepaid, or one day
after deposit with an overnight courier or delivery service provided that the
sending party has a receipt of such deposit, addressed as follows (or to such
other addresses as the parties may specify by due notice to the others):
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Buyer: CAPSTONE PHARMACY SERVICES, INC.
0000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000-0000
Attn: R. Xxxx Xxxxxxx
Seller: DCAMERICA INC.
000 Xxxx Xxxxxx
Xxxx Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx
Copies to: XXXXXXX XXXXXX XXXX XXXXXXX & MANNER, P.C.
1800 First American Center
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxx Manner
8.2 Expenses. Seller and Buyer each shall bear its own costs and
expenses incurred in connection with the preparation of this Agreement, Closing
of the transaction contemplated hereunder and all other agreements or writings
prepared in connection herewith.
8.3 Headings. The headings in this Agreement are intended solely
for convenience or reference and shall be given no effect in the construction
or interpretation of this Agreement.
8.4 Governing Law. This Agreement shall be governed by the laws
of the State of Delaware.
8.5 Assignment. This Agreement shall inure to the benefit of and
be binding on the successors and legal representatives of each of the parties,
but this Agreement may be not be assigned by any party without the written
consent of the other parties; provided, however, that Buyer may assign this
Agreement in whole or in part to a subsidiary or affiliate of Buyer, and may
assign its rights hereunder to any lender, provided no such assignment shall
affect the obligations of Buyer.
8.6 Counterparts. This Agreement may be executed in one or more
counterparts, all of which will be considered one and the same agreement.
8.7 Exclusiveness. This Agreement embodies all of the
representations, warranties, and agreements of the parties hereto with respect
to the subject matter hereof, and all prior understandings, representations,
and warranties (whether oral or written) with respect to such matters are
hereby superseded and merged into this Agreement. This Agreement may not be
amended, modified, waived, discharged, or orally terminated except by an
instrument in writing signed by Buyer and Seller.
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8.8 Severability. The invalidity or unenforceability of any
particular provision of this Agreement shall not affect the other provisions
hereof, and this Agreement shall be construed in all respects as if such
invalid or unenforceable provisions were omitted. Furthermore, in lieu of such
illegal, invalid, or unenforceable provision there shall be added automatically
as a part of this Agreement a provision as similar in terms to such illegal,
invalid, or unenforceable provision as may be possible and be legal, valid and
enforceable.
8.9 Schedules. The Schedules annexed hereto form an integral part
of this Agreement and are hereby incorporated into this Agreement wherever
reference is made to them to the same extent as if they were set out in full at
the point at which such reference is made.
8.10 Survival. The provisions of this Agreement shall survive
Closing.
8.11 No Third Party Beneficiaries. The provisions of this
Agreement are solely for the benefit of the parties hereto, and with respect to
Buyer, its parent and any of their directors, officers, shareholders, employees
and agents as well as the Corporation. It shall create no rights in any
persons other than as set forth in the immediately preceding sentence.
IN WITNESS WHEREOF, Seller and a duly authorized officer of Buyer have
executed this Agreement as of the date first written above.
THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK
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BUYER:
CAPSTONE PHARMACY SERVICES, INC.
By:
-------------------------------------
Title:
-------------------------------------
SELLER:
DCAMERICA INC.
By:
-------------------------------------
Title:
-------------------------------------
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LIST OF SCHEDULES
1.3 Excluded Obligations
1.7 Purchase Price
2.4 (a) Financial Statements
2.5 (a) List and Copies/Summaries of Leased
Real Property Including a Description
of all other interests in Real Property
2.5 (b) List and Description of all Leased
Equipment and Furnishings with Copies
of Leases
2.8 Third Party Consents
2.9 Litigation
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Schedule 1.3 Excluded Obligations
None
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Schedule 1.7 Purchase Price
$5,989,852.07
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Schedule 2.4(a) Financial Statements
(see attached)
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Schedule 2.5(a) Leased Real Property
(see attached)
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Schedule 2.5(b) Leased Equipment and Furnishings
(see attached)
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Schedule 2.8 Third-Party Consents
None Required
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Schedule 2.9
Medidyne is considering litigation against Medical Biotics and certain
employees and shareholders of Medical Biotics for breach of the purchase
agreement and for misrepresentations made in connection with the purchase
agreement.
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