EXHIBIT 3.1
STOCK PURCHASE AGREEMENT
Agreement made as of August 31, 1996 among Direct Financial
Services, Inc., an Illinois corporation ("DFS"), Preferred Health
Choice, Inc., an Illinois corporation, ("PHC"), the undersigned
individual shareholders of PHC (collectively, the "Shareholders",
and individually, a "Shareholder"), ACMG, Inc., an Ohio corporation
(the "Company"), and ACMG of Louisiana, Inc., a Louisiana
corporation ("ACMG-Louisiana").
RECITALS
WHEREAS, the Shareholders own the number of shares of common
stock of PHC set forth opposite their signatures below (the "PHC
Shares");
WHEREAS, the Company is indebted to PHC or its subsidiaries in
the amount of $1,881,000; and
WHEREAS, the parties desire to consummate the series of
transactions (collectively, the "Transaction") provided for herein
pursuant to which, among other things (x) DFS shall purchase from
the Shareholders, and the Shareholders sell to DFS, all of the PHC
Shares, (y) PHC shall loan, to the Company certain amounts, and (z)
the Company shall issue to PHC promissory notes in the forms of
Exhibits A, B and C hereto (individually, a "Note", and
collectively, the "Notes") evidencing the outstanding indebtedness
of the Company to PHC and the amounts to be loaned by PHC to the
Company.
NOW, THEREFORE, in consideration of the premises and the
representation, warranties and covenants herein contained, and for
other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
THE TRANSACTION
1.1 Prior to September 30, 1996
(a) Pioneer Financial Services, Inc. ("PFS") shall amend its
existing 401(k) plan, among other things, to:
(i) waive the "last day" rule for 1996 for Company
participants, for purposes of PFS "matching" and profit
sharing contributions during 1996.
(ii) to fully vest Company participants as of the
date hereof.
(iii) to permit the payout of plan account balances
to Company participants as soon as practicable after the
date hereof.
(b) PFS shall pay to Company participants their account
balances in the PFS 401(k) plan.
1.2 Simultaneously with the execution and delivery of this
Agreement:
(a) DFS is purchasing from the Shareholders, and the
Shareholders are selling to DFS, the PHC Shares for a purchase
price of $0.99808448432 per share ($19,800 in the aggregate;
and, in connection therewith:
(i) Each Shareholder is transferring to PHC a
certificate or certificates representing the number of
PHC Shares set forth opposite such Shareholder's
signature below, duly assigned to PHC, in form and
substance satisfactory to PHC and its Counsel.
(ii) DFS delivering to each Shareholder, in cash, an
amount equal to the purchase price for his or her PHC
Shares.
(b) The Company is delivering executed copies of the
Notes to PHC.
(c) The Shareholders are delivering to PHC the written
resignations of Xxxx X. XxXxx, Xxxxxxx Xxxxxx, Xxxxx Xxxxxxxx,
Xxxxxx Xxxxxxxx, Xxxxx Xxxx, Xxxxxxx Xxx, Xxxxxx Xxxxxx and
Xxxxx X. Xxxxxxx from their capacities as officers or
directors of PHC and its subsidiaries (other than the Company
and its subsidiaries).
(d) PHC, the Company and certain Shareholders are
entering into that certain Payroll Pledge Agreement of even
date herewith (the "Payroll Pledge Agreement") and such
Shareholders are assigning and transferring to PHC as
collateral thereunder their stock certificates representing
the capital stock of the Company owned or here after acquired
by such Shareholders.
(e) PHC, the Company and ACMG-Louisiana are entering
into that certain VHP Pledge Agreement of even date herewith
(the "VHP Pledge Agreement") which provides for the assignment
and transfer to PHC as collateral thereunder their shares, of,
or other equity interest in, Vantage Health Plan, Inc., a
Louisiana corporation ("VHP") (the Payroll Pledge Agreement
and the VHP Pledge Agreement being hereinafter sometimes
referred to collectively as the "Pledge Agreements").
(f) PHC has eliminated all amounts heretofore payable by
the Company or its subsidiaries to PHC, its subsidiaries or
affiliates other than those (x) represented by the Notes
attached as Exhibits A, B and C, or (y) payable under existing
written agreements between the Company or its subsidiaries and
PHC, its subsidiaries or affiliates.
(g) PHC, on the one hand, and the Shareholders, on the
other hand, have received such other documents or instruments
as they or their counsel have reasonable requested in
connection with the transactions contemplated hereby.
1.3 The Shareholders' Agreement dated as of July 24, 1995
among Direct Financial Services, Inc., PHC and certain of the
Shareholders (the Shareholders' Agreement") is terminated as of the
date hereof; and no party thereto shall have any further right,
obligation or liability thereunder.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF DFS
DFS hereby represents and warrants to the Company, the
Shareholders and their respective successors and assigns as
follows:
2.1 Organization and Qualification. DFS and PHC are
corporations duly incorporated and in good standing as domestic
corporations under the laws of the State of Illinois.
2.2 Authority Relative to this Agreement. DFS and PHC each
has the requisite corporate power and authority to execute and
deliver this Agreement, PHC has the requisite corporate power and
authority to execute and deliver the Pledge Agreements, and DFS and
PHC have the requisite corporate power and authority to fulfill
their obligations hereunder and thereunder. The execution and
delivery of this Agreement by DFS and PHC, the execution and
delivery of the Pledge Agreements by PHC and the performance of
their obligations hereunder and thereunder have been duly and
validly authorized by the Board of Directors of DFS and PHC and the
shareholders of PHC, and no other corporate proceedings on the part
of DFS or PHC are necessary, as a matter of law or otherwise, in
connection therewith. This Agreement and the Pledge Agreements
have been duly and validly executed and delivered by DFS or PHC, as
the case may be; and, assuming that they constitute the valid and
binding agreements of the Company, ACMG-Louisiana and the
Shareholders, as the case may be, this Agreement constitutes the
valid and binding agreements of DFS and PHC, and the Pledge
Agreements constitute the valid and binding agreements of PHC,
enforceable against DFS or PHC, as the case may be, in accordance
with their respective terms, except (a) as such enforcement may be
subject to bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to
creditors' rights, and (b) as the remedy of specific performance
and injunctive and other forms of equitable relief may be subject
to equitable defenses and to the discretion of the court before
which any proceeding therefore may be brought.
2.3 Consents and Approvals; No Violation.
(a) The execution and delivery of this Agreement and the
Pledge Agreements do not and the consummation of the
transactions contemplated hereunder and thereunder will not:
(i) conflict with any provision of the certificate
of incorporation or bylaws of DFS or PHC;
(ii) conflict with, result in the breach of or
constitute a default (or give rise to any right of
termination, cancellation or acceleration) under any of
the terms, conditions or provisions of any note, lease,
mortgage, license, agreement or other instrument or
obligation to which DFS or PHC is a party or by which PHC
or DFS or any of their assets may be bound; or
(iii) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to DFS or PHC.
(b) No consent, approval, order or authorization of, or
registration, declaration or filing with, any court,
administrative agency or commission, insurance regulatory
authority or other governmental authority or instrumentality,
domestic or foreign, (a "Governmental Entity") is required by
or on behalf of DFS or PHC in connection with the execution
and delivery of this Agreement or the Pledge Agreements by PHC
or the consummation by PHC of the transactions contemplated
hereby and thereby.
2.4 Certain Fees and Expenses. No person or entity has been
authorized by DFS or PHC to act for DFS or PHC in connection with
the transactions provided for in this Agreement in a way which
would entitle such person to receive from the Company or the
Shareholders any broker's fees, commissions, finder's fees,
investment banking or financial advisory fees in connection with
this Agreement (or for reimbursement of any expenses related
thereto).
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
THE COMPANY, ACMG-LOUISIANA AND THE SHAREHOLDERS
The Company, ACMG-Louisiana and the Shareholders, jointly and
severally, hereby represent and warrant to DFS, PHC and their
respective successors and assigns as follows:
3.1 Organization and Qualification. The Company and ACMG-
Louisiana are corporations duly organized, validly existing and in
good standing as domestic corporations under the laws of the states
of Ohio and Louisiana, respectively, and are duly qualified to do
business as a foreign corporation and are in good standing in each
other jurisdiction in which the character of its properties or the
nature of its business makes such qualification necessary. The
Company and ACMG-Louisiana have the requisite corporate power and
authority to own, use or lease their respective properties and to
carry on their respective businesses as now being conducted.
3.2 Authority Relative to this Agreement. The Company and
ACMG-Louisiana each has the requisite corporate power and authority
to execute and deliver this Agreement and the VHP Pledge Agreement,
the Company has the requisite corporate authority to execute and
deliver the Notes and the Payroll Pledge Agreement, and the Company
and ACMG-Louisiana have the requisite corporate power and authority
to fulfill their obligations hereunder and thereunder. The
execution and delivery of this Agreement, the Pledge Agreements and
the Notes by the Company, and the execution and delivery of this
Agreement and the VHP Pledge Agreement by ACMG-Louisiana and the
performance of their respective obligations hereunder and
thereunder have been duly and validly authorized by the Board of
Directors of the Company and, ACMG-Louisiana, respectively, and no
other corporate proceedings on the part of the Company or ACMG-
Louisiana are necessary, as a matter of law or otherwise, in
connection therewith. This Agreement has been duly and validly
executed and delivered by the Company, ACMG-Louisiana and the
Shareholders, the Notes and the Payroll Pledge Agreement have been
duly and validly executed and delivered by the Company, the VHP
Pledge Agreement has been duly and validly executed by the Company
and ACMG-Louisiana and, assuming this Agreement and the Pledge
Agreements constitute the valid and binding agreements of DFS or
PHC, as the case may be, this Agreement, the Pledge Agreements and
the Notes constitute the valid and binding agreements of the
Company, ACMG-Louisiana and the Shareholders, and the Notes
constitute the valid and binding agreement of the Company,
enforceable against the Company, ACMG-Louisiana and the
Shareholders, as the case may be, in accordance with their
respective terms, except (a) as such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights, and
(b) as the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and
to the discretion of the court before which any proceeding therefor
may be brought.
3.3 Title to Shares.
(a) Each of the Shareholders owns of record and
beneficially the number of PHC Shares set forth opposite his
signature below.
(b) The PHC Shares formerly owned by Xxxxxxxx Xxxxx have
been duly, validly, legally and properly repurchased pursuant
to the Shareholders' Agreement.
(c) By virtue of the transactions contemplated herein,
PHC will acquire good and valid title to all of the PHC
Shares, free and clear of all liens, charges, pledges,
encumbrances, equities, rights of first refusal, options or
claims of any nature (other than those created by PHC).
3.4 Consents and Approvals; No Violation.
(a) The execution and delivery of this Agreement, the
Pledge Agreements and the Notes do not and the consummation
of the transactions contemplated hereby and thereby will not:
(i) conflict with any provision of the certificate
of incorporation or bylaws of the Company or ACMG-
Louisiana;
(ii) conflict with, result in the breach of or
constitute a default (or give rise to any right of
termination, cancellation or acceleration) under any of
the terms, conditions or provisions of any note, lease,
mortgage, license, agreement or their instrument or
obligation to which the Company, ACMG-Louisiana or any
Shareholder is a party or by which the Company, ACMG-
Louisiana or any Shareholder or any of their assets may
be bound; or
(iii) violate any writ, order, injunction, decree,
statute, rule or regulation applicable to the Company,
ACMG-Louisiana or any Shareholder.
(b) No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental
Entity is required by or on behalf of the Company, ACMG-
Louisiana or any Shareholder in connection with the execution
and delivery of this Agreement by the Shareholders or the
transactions contemplated hereby or thereby.
3.5 Certain Fees and Expenses. No person or entity has been
authorized by the Company, ACMG-Louisiana or the Shareholders to
act for the Company, ACMG-Louisiana or the Shareholders in
connection with the transactions provided for in this Agreement in
a way which would entitle such person to receive from DFS or PHC
any broker's fees, commissions, finder's fees, investment banking
or investment advisory fees in connection with this Agreement (or
for reimbursement of any expenses related thereto).
ARTICLE IV
ADDITIONAL COVENANTS
4.1 Confidentiality. The parties hereto each agrees that
after the date hereof it will hold in confidence all information,
data and documents obtained by it or any of its representatives or
affiliates from any representative, officer, director or employee
of any other party (the "Furnishing Parties") and that neither it
nor any of its representatives or affiliates will disclose any such
information, data or documents to any third party other than as
required by law or required or requested by or any regulatory
authority in connection with the transactions contemplated herein.
Such obligation of confidentiality shall not extend to any
information, data or document which is shown to have been
previously known to such party or generally known to others engaged
in the same business as the Furnishing Parties, or that is or shall
become part of public knowledge or that shall have been lawfully
received by such party from a third party other than professional
advisors and other representatives or which is required or
requested by any regulatory entity to be submitted to such
regulatory entity.
4.2 Communications. No party will issue any press release
relating to the transactions contemplated by this Agreement without
the prior written approval of the other parties as to the content
thereof, which approval shall not be unreasonably withheld or
delayed. Nothing in this Section 4.2, however, shall be deemed (a)
to prohibit any disclosure reasonably required by any applicable
law or by any governmental or regulatory authority or (b) to
prevent either party from disclosing the general nature of the
transactions contemplated hereby without identifying the other
party or any of its affiliates.
4.3 Expenses. Whether or not the transactions contemplated
hereby are consummated, all costs and expenses (including without
limitation, fees and expenses of counsel and accountants) incurred
in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such expense except as
otherwise specifically set forth herein.
4.4 Brokers or Finders. No party hereto nor any of their
respective affiliates shall enter into any agreement or arrangement
with any agent, broker, investment banker or other firm or person
pursuant to which such person shall be entitled to any broker or
finder's fee or any other commission or similar fee from any other
party in connection with any of the transactions contemplated by
this Agreement.
4.5 Additional Actions. Subject to the terms and conditions
of this Agreement, each of the parties hereto agrees to use all
reasonable efforts to take, or cause to be taken, all reasonable
action and to do, or cause to be done, all things reasonably
necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions
contemplated by this Agreement as promptly as reasonably
practicable. In case at any time after the date hereof any further
action is necessary or desirable to carry out the purposes of this
Agreement, each party to this Agreement, to the extent within such
party's reasonable control, shall take all such necessary action.
4.6 Shareholder Liability. The Shareholders shall cause the
Company, and the Shareholders and the Company shall cause ACMG-
Louisiana, to perform fully and in a timely manner their
obligations hereunder and under the Notes and the Pledge
Agreements. The parties hereto each acknowledges and agrees that no
other party hereto is making any representation or warranty,
express or implied, except as provided herein or therein.
4.7 Payroll.
(a) For each bi-weekly payroll period of the Company
commencing August 19, 1996 through September 29, 1996, PHC
shall lend to the Company, by wire transfer to an account
designated in writing by the Company in immediately available
funds, prior to 3:00 p.m., EST, on the day prior to the date
the Company is required to fund such payroll expense and on
the terms and subject to the conditions set forth in the form
of Note attached as Exhibit B hereto, an amount equal to such
payroll expense; provided, however, that PHC's obligations
hereunder shall not exceed $750,000 in the aggregate. The
Company shall repay such loans in accordance with the terms of
such Note.
(b) PHC, directly or indirectly through one of its
affiliates, will continue to provide payroll administrative
services (but not employee benefit administrative services)
through December 31, 1996 in substantially the same manner
such services have heretofore been provided by PHC or its
affiliates; provided, however, that PHC shall have no
obligation to provide such services if the Company does not
provide PHC or its designee with such information as PHC or
its designee may reasonably request, at such times as PHC or
its designee may reasonable request, in connection with the
performance of such services and if, for all payroll periods
beginning September 30, 1996, the Company does not deliver,
prior to the time payment is required, sufficient funds to the
PHC or its designee to enable it to make any payroll payment
required hereunder.
4.8 Insurance. PHC will cooperate with the Company in
maintaining corporate and insurance and bonds heretofore covering
the Company; provided, however, that neither PHC nor any of its
affiliates shall be required to modify their existing coverage or
to incur any additional expense with respect thereto.
4.9 Non-Solicitation. For a period of one year from the date
hereof, no party hereto or any of their affiliates shall solicit,
recruit, employ, contract with, or attempt to solicit, recruit,
employ or contract with, any employee of any other party or its
affiliates.
4.10 Non-Compete. Except as the Company may consent, for a
period of one year from the date hereof, neither PFS nor any of its
affiliates will invest in, or otherwise participate in the
management of, any health maintenance organization serving the
areas now served by the four health maintenance organizations in
which the Company or its subsidiaries are shareholders as described
in Exhibit D hereto.
4.11 Xxxx Participation. So long as Xxxxxxx X. Xxxx is an
employee of PFS or its affiliates during such period, for a period
of nine months from the date hereof, PFS will make Xx. Xxxx
available to attend board meetings of the South Carolina health
maintenance organization of which the Company or its subsidiaries
is a shareholder and for general consultation with respect to such
organization, in each case, on a limited basis and upon reasonable
notice.
4.12 Certain Transactions. Neither the Company nor the
Shareholders shall, and the Shareholders shall not permit the
Company to, participate in an Offering, Asset Sale, Merger or Stock
Sale (as those terms are defined in the Payroll Pledge Agreement)
without first ensuring, in a manner reasonably satisfactory to
PHC, that payment of all amounts due under the promissory note of
even date herewith of the Company to PHC in the principal amount of
$1,300,000 are paid in full as provided therein.
4.13 Investments in VHP. No Shareholder shall, and the
Shareholders and the Company shall ensure that no direct or
indirect subsidiary or other affiliate of the Company other than
ACMG-Louisiana shall, purchase or own, or become entitled to
purchase or own, any share of capital stock of, or other equity
interest in, VHP.
ARTICLE V
RELEASE; INDEMNIFICATION
5.1 Release. The Company, ACMG-Louisiana and each of the
Shareholders, for themselves and their respective subsidiaries,
successors, assigns, employees, officers, directors, shareholders,
representatives, agents and affiliates, hereby releases and
discharges DFS, PHC and their respective affiliates, successors,
assigns, employees, officers, directors, shareholders,
representatives, agents and affiliates of and from all claims,
demands, actions, suits, judgements, damages, and liabilities, at
law or in equity, whether known or unknown, from the beginning of
time, except those arising hereunder or under the Pledge
Agreements.
5.2 Indemnification.
(a) The Company, ACMG-Louisiana and each of the
Shareholders, jointly and severally, shall indemnify, defend
and hold harmless DFS, PHC, and their respective subsidiaries
and affiliates and their respective officers, directors,
agents, employees, representatives, successors and assigns
("PHC Indemnified Parties") from and against any and all
claims, actions, suits, proceedings, demands, assessments,
judgements, losses expenses, damages, recoveries and
deficiencies, including without limitation interest,
penalties, and reasonable attorney's fees, expert witness
fees, costs and other expenses (collectively, "Losses") borne
by or asserted against any PHC Indemnified Party in any way
arising out of, relating to or resulting from (v) any
misrepresentation or breach of warranty contained in this
Agreement or the Pledge Agreements, (w) any other breach by
the Company, ACMG-Louisiana or the Shareholders of their
obligations under this Agreement or the Pledge Agreements, (x)
PHC's obligations under Section 4.7(b) hereof to the extent
not arising out of PHC's wilful misconduct or gross
negligence, (y) otherwise relating to the ownership or
operation of the Company or its subsidiaries or affiliates, or
(z) the cessation of employment of Xxxxxxxx Xxxxx or the
repurchase of her shares pursuant to the Shareholders'
Agreement or otherwise.
(b) The following provisions shall be applicable in the
event that any PHC Indemnified Party asserts indemnity rights
pursuant to this Article V relating to any third party claim:
(i) Within 30 days after the receipt by the party
entitled to indemnity hereunder (the "Indemnified Party")
of any claim or demand (including but not limited to,
notice of any action, suit or proceeding) by any third
party against an Indemnified Party which gives rise to a
right to claim of indemnification hereunder, the affected
Indemnified Party shall give the Company and the
Shareholders (collectively, the "Indemnifying Party")
written notice of such claim or demand; provided,
however, that the failure to give such notice shall not
relieve the Indemnifying Party of its obligations
hereunder except to the extent that such failure is
materially prejudicial to the Indemnifying Party.
(ii) The Indemnifying Party shall have the right
(without prejudice to the right of any Indemnified Party
to participate at its own expense through counsel of its
choosing), to defend against such claim or demand at its
expense and through counsel of its own choosing (the
choice of such counsel to be subject to the reasonable
consent of the affected Indemnified Parties) and to
control such defense if it gives written notice of its
intention to do so within 15 days of the receipt of the
notice referred to in Section 5.2 (b) above. If the
Indemnifying Party shall decline or fail to assume the
defense of such claim or demand, the affected Indemnified
Parties shall have the right to assume control of such
defense at the expense of the Indemnifying Party. The
Indemnified Parties shall cooperate fully in the defense
of such claim or demand and shall make available to the
Indemnifying Party or its counsel all pertinent
information under their control relating thereto. The
Indemnifying Party agrees to cooperate with the
Indemnified Parties in order to enable their counsel to
participate in the defense and to deliver to the
Indemnified Parties Copies of all pleading and other
information within the Indemnifying Party's knowledge or
possession reasonable requested by the Indemnified
Parties that is relevant to the defense of any such claim
or demand. The Indemnifying Party and the Indemnified
Parties and their respective counsel shall maintain
confidentiality with respect to all such information
consistent with the conduct of a defense hereunder.
(iii)The Indemnifying Party shall have the
right to elect to settle any such claim or demand for
monetary damages only at its sole expense and provided
the settlement includes an unconditional release of all
Indemnified Parties, subject to the consent of the
affected Indemnified Parties; provided, further, that if
the affected Indemnified Parties fail to give such
consent within 20 days of being requested to do so, the
affected Indemnified Parties shall, at their expense,
assume the defense of such claim or demand regardless of
the outcome of such matter, the Indemnifying Party's
liability hereunder shall be limited to the amount of any
such proposed settlement plus costs and expenses incident
to the defense and settlement of such claim or demand.
(iv) In the event the Indemnifying Party
assumes the defense of a claim or demand, the Indemnified
Parties shall have the right thereafter to take over
control of the defense of any claim or demand from the
Indemnifying Party at any time and to elect to settle
such claim or demand; provided, however, that in such
case, unless otherwise agreed by the Indemnifying Party,
the Indemnifying Party shall have no indemnification
obligations with respect to such claim, demand or
settlement except for the costs and expenses of such
Indemnifying Party incurred in the defense of the claim
or demand.
ARTICLE VI
GENERAL PROVISIONS
6.1 Amendment. This Agreement may not be amended except by
an instrument in writing signed by or on behalf of each of the
parties hereto.
6.2 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given upon personal
delivery, facsimile transmissions (with written or facsimile
confirmation of receipt), telex or delivery by an overnight express
courier service (delivery, postage or freight charges prepaid), or
on the fourth day following deposit in the United States mail (if
sent by registered or certified mail, return receipt requested,
delivery postage or freight charges prepaid), addressed to the
Shareholders at the addresses set forth under their signatures
below or to the other parties at the following addresses (or at
such other address for a party as shall be specified by like
notice):
(a)if to DFS or PHC, to: Direct Financial Services, Inc.
President
0000 X. Xxxx Xx.
Xxxxxxxxxx, XX 00000
with a copy to: Xx. Xxxxx X. Xxxx, Xx.
Pioneer Financial Services, Inc.
0000 X. Xxxx Xxxx
Xxxxxxxxxx, XX 00000
(b)if to the Company or ACMG, Inc.
ACMG-Louisiana, to: President
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
with a copy to: Mr. Xxxx Xxxx
Xxxx, Xxxxxxx & Xxxxxxxx
000 Xxxxxx, Xxxxx 0000
Xxxxxxxxxx, Xxxx 00000
6.3 Interpretation. When a reference is made in this
Agreement to an Article, Section, Exhibit or Schedule, such
reference shall be to an Article, Section, Exhibit or Schedule to
this Agreement unless otherwise indicated. All Exhibits referred to
herein are hereby incorporated by reference herein. The words
"include," "includes" and "including" when used herein shall be
deemed in each case to be followed by the words "without
limitation." The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in
any way the meaning or interpretation of this Agreement. Whenever a
representation or warranty herein is made to the "knowledge," "best
knowledge" or awareness of a party, it shall refer to matters
within the actual knowledge of such party and such party's
officers, provided that, in the case of each party, such references
shall be deemed to impose upon such party a duty to conduct a
reasonable investigation of the matters covered thereby including
making inquiries of appropriate officers and key employees with
respect to matters within such persons' areas of responsibility, as
well as investigation of reasonably available corporate records
concerning such matters.
6.4 Counterparts. This Agreement may be executed in two
counterparts, each of which shall be considered one and the same
document and shall become effective when the counterparts have been
signed by each of the parties and delivered to the other party, it
being understood that each party need not sign the same
counterpart.
6.5 Miscellaneous. This Agreement, the Pledge Agreements, the
Exhibits, Schedules, Notes, documents, instruments and other
agreements specifically referred to herein (a) constitute the
entire agreement among the parties with respect to the subject
matter hereof and supersede all prior agreements and
understandings, both written and oral, among the parties with
respect to the subject matter hereof; (b) are not intended to
confer upon any other person any rights or remedies hereunder.
Each party hereby acknowledges and agrees that it has not repied
upon any statement, representation or warranty relating to the
matters covered by this Agreement other than those contained
herein.
6.6 Governing Law. This Agreement shall be governed in all
respects, including validity, interpretation and effect, by the
laws of the State of Illinois, without giving effect to its
conflict of law provisions.
6.7 Severability. In case any provision in this Agreement
shall be found by a court of competent jurisdiction to be invalid,
illegal or unenforceable, such provision shall be construed and
enforced as if it had been narrowly drawn so as not to be invalid,
illegal or unenforceable, and the validity, legality and
enforceability of the remaining provisions of this Agreement shall
not in any way be affected or impaired thereby.
6.8 Successors and Assigns. PHC shall have the right to
assign their rights hereunder to any wholly-owned direct or
indirect subsidiary of PFS. Neither the Company, ACMG-Louisiana
nor the Shareholders shall be permitted to assign their rights or
liabilities hereunder without the prior written consent of PHC.
This Agreement shall be binding upon the parties hereto and their
respective successors and permitted assigns and shall inure to the
benefit of the parties hereto and their respective permitted
successors and assigns.
6.9 Time of the Essence. The parties agree that time is of
the essence of each provision of this Agreement.
6.10 Attorneys' Fees. In the event of any dispute with respect
to the subject matter of this Agreement, the prevailing party shall
be entitled to such party's reasonable attorneys' fees and court
costs incurred in resolving or settling the dispute, in addition to
any and all other damages to which such party may be entitled.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be signed by their respective officers thereunto duly
authorized as of the date first written above.
PREFERRED HEALTH CHOICE, INC.
By: _________________________________________
Its:_________________________________________
THE SHAREHOLDERS: PHC SHARES:
__________________________________________ 6,505
Xxxx X. XxXxx
__________________________________________ 5,856
Xxxxxxx X. Xxxxxx
__________________________________________ 3,702
Xxxxx X. Xxxxxxxx
__________________________________________ 2,294
Xxxxx X. Xxxx
__________________________________________ 719
Xxxxxxx X. Xxx
__________________________________________ 263
Xxxxxx X. Xxxxxxxx
__________________________________________ 80
Xxxxxx X. Xxxxxx
__________________________________________ 61
Xxxxx X. Xxxxx
__________________________________________ 00
Xxxxx Xxxxxxx
__________________________________________ 212
Xxxxxx Xxxxxxxx
__________________________________________ 35
Xxxxx X. Xxxxxxx
__________________________________________ 10
Xxxxx X. Xxxxxxx
__________________________________________ 4
Xxxx X. Xxxxxx
ACMG, INC.
By: ____________________________________
Its:____________________________________
DIRECT FINANCIAL SERVICES, INC.
By: ____________________________________
Its:____________________________________
ACMG OF LOUISIANA, INC.
By: ____________________________________
Its:____________________________________
acmg\agreemen\stkprcha.092
