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EXHIBIT 2.4
WAIVER AND THIRD AMENDMENT TO SHAREHOLDERS' AGREEMENT
This WAIVER AND THIRD AMENDMENT TO SHAREHOLDERS' AGREEMENT dated as of
June 13, 1997 (the "Agreement"), by and between Criterion Health Strategies,
Inc. (f/k/a Alpha Development Corp.), a Tennessee corporation (the "Company"),
Healthdyne Information Enterprises, Inc., a Georgia corporation ("HIE"), The
Southern Venture Fund II, L.P., a Delaware limited partnership ("SVFII") (HIE
and SVFII, collectively, the "Investors"), Xxxxxxx X. Xxxxxx ("Teveit") and J.
Xxxxxx Xxxxxxx, Xx. ("Pearson") (Teveit and Pearson, collectively, the
"Incorporators").
WITNESSETH:
WHEREAS, each of HIE, SVFII, Teveit and Pearson are investors in the
Company, with the following respective interests in the Company:
(i) each of the Investors owning twenty-five (25) shares of
Criterion Common Stock and a Convertible Debenture of the Company due June 30,
2004, dated October 21, 1994, in the principal amount of up to $2,000,000
(individually, a "Criterion Debenture" and, collectively, the "Criterion
Debentures"), pursuant to the terms of the Investment Agreement (as hereinafter
defined) among the Company, Healthdyne, Inc., a Georgia corporation
("Healthdyne"), HIE, SVFII, and the Incorporators; and
(ii) each of the Incorporators owning 650,000 shares of
Criterion Common Stock (as to each Incorporator, the "Incorporator's Criterion
Shares" and, collectively, the "Incorporators' Criterion Shares"); and
WHEREAS, the Investors are parties to the SVFII Agreements (as
hereinafter defined), pursuant to which SVFII has granted to HIE an option to
purchase SVFII's entire investment in the Company; and
WHEREAS, the Company, the Investors and the Incorporators have
previously entered into a Consent (as hereinafter defined), pursuant to which
the parties consented to the execution and entry into the SVFII Agreements and
the consummation of the transactions contemplated thereby, subject, in the case
of the Incorporators and the Company, to the execution and consummation of
definitive agreements between HIE and the Incorporators as contemplated by the
AIP (as hereinafter defined); and
WHEREAS, the Company, HIE and each of the Incorporators desires to
restructure the transactions contemplated by the AIP as set forth in the
agreement of even date herewith among the Company, HIE and Teveit (the "Teveit
Agreement") and in the agreement of even date herewith among the Company, HIE
and Pearson (the "Pearson Agreement") (the Teveit Agreement and the Pearson
Agreement, collectively, the "Restructuring Agreements"); and
WHEREAS, pursuant to the Restructuring Agreements, Teveit and Pearson
will no longer hold any equity interest in the Company and will resign as
directors of the Company;
NOW, THEREFORE, in consideration of the premises hereof and the mutual
benefits to be derived hereunder and other good and valuable consideration, the
receipt and sufficiency of
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which are hereby acknowledged, the Company, HIE, SVFII, Teveit and Pearson agree
as follows:
1. Definitions. For purposes of this Agreement, the following
terms shall have the respective meanings indicated below:
"AIP" -- Agreement in principle dated November 6, 1996 among
HIE and the Incorporators.
"Amended Shareholders Agreement" -- the Shareholders'
Agreement dated as of October 21, 1994 between Healthdyne, the Company and the
Incorporators, as amended by the Waiver and Second Amendment to Shareholders'
Agreement dated as of December 4, 1995 between Healthdyne, the Company, HIE,
SVFII and the Incorporators.
"Consent"-- the Consent dated as of December 18, 1996 between
the Company, HIE, SVFII, Teveit and Pearson.
"Investment Agreement" -- the Investment Agreement and First
Amendment to Incorporation Agreement dated as of December 4, 1995 among
Healthdyne, the Company, HIE, SVFII and the Incorporators.
"SVFII Agreements" -- the Option Agreement dated as of
December 18, 1996 between HIE and SVFII, as amended by that certain letter
agreement between HIE and SVFII dated May 16, 1997, and related Stock Purchase
Warrant.
2. Waiver. The Company, HIE, SVFII, Teveit and Pearson hereby
waive their Rights of First Refusal as set forth in Article Three of the
Shareholders' Agreement with respect to, and consent to, the transfers
contemplated by the SVFII Agreements and the Restructuring Agreements.
3. Teveit and Pearson as Parties. The Amended Shareholders'
Agreement is hereby amended to terminate the rights of Teveit and Pearson under
such agreement, as follows:
(a) Right of First Refusal. Article III relating to "Right of
First Refusal" is hereby amended to delete all references to the Incorporators.
(b) Preemptive Rights. Article IV relating to "Preemptive Rights"
is hereby amended to delete all references to the Incorporators. Accordingly,
the term "Holder" set forth in Section 4.1(a)(ii) shall mean an Investor and a
holder of the Convertible Debenture or any holder of Stock issued upon
conversion of the Convertible Debenture.
4. Continuing Effect. Except as specifically amended herein, the
Amended Shareholders' Agreement remains in full force and effect.
5. Counterparts. For the convenience of the parties, any number
of counterparts of this Agreement may be executed and all such counterparts or
facsimile copy thereof shall be deemed to be an original instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first above written.
CRITERION HEALTH STRATEGIES, INC.
By: /s/ H. Xxxxxxx Xxxxx
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Name: H. Xxxxxxx Xxxxx
Title: Chairman and Chief Executive
Officer
HEALTHDYNE INFORMATION ENTERPRISES, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Vice President and Chief
Financial Officer
THE SOUTHERN VENTURE FUND II, L.P.
By: Its General Partner
SV Partners II, L.P.
By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
Title: Partner
XXXXXXX X. XXXXXX
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
J. XXXXXX XXXXXXX, XX.
/s/ J. Xxxxxx Xxxxxxx, Xx.
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J. Xxxxxx Xxxxxxx, Xx.
