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AGREEMENT OF SALE
dated December 11, 1996
between
Xxxxxx Xxxxxxx, P.T., P.C., Seller
and
New Medical Practice, P.C.
Purchaser
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AGREEMENT OF SALE
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AGREEMENT OF SALE, made December 11, 1996, among XXXXXX XXXXXXX, P.T., P.C.
("Seller"), the Specialist Provider, billing entity and Medical Manager at each
of the physical therapy business locations of Sportset Physical Therapy, located
at 00 Xxxxx Xxxxxx, Xxxxxxxxx Xxxxxx, Xxx Xxxx 00000, Sportset-Syosset Physical
Therapy located at 00 Xxxxxx Xxxxx, Xxxxxxx, Xxx Xxxx 00000, Paerdegat Physical
Therapy located at 0000 Xxxxxxxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000 and
Atrium Physical Therapy located at 000 Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000,
and New Medical Practice, P.C., a New York Professional Corporation, having an
address at 0 Xxxxxxx Xxxxx Xxxxx 000, Xxxxx Xxxxxx, XX 00000 ("Purchaser").
W I T N E S S E T H:
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WHEREAS, Purchaser desires to acquire, and Seller desires to sell, the assets of
the corporation Xxxxxx Xxxxxxx, P.T., P.C. located at each of the four (4) sites
noted above, such corporation doing business as noted herein and hereinafter
specified, upon the terms and conditions hereinafter set forth, and
WHEREAS, Xxxxxx Xxxxxxx is the sole shareholder of Seller,
WHEREAS, Xxxxxx Xxxxxxx, P.T., P.C. is the Specialist Provider billing entity
and medical manager of the business locations,
NOW, THEREFORE, in consideration of the covenants and agreements hereafter set
forth, and other valuable consideration, the receipt and sufficiency of which
hereby is acknowledged, the parties hereto agree as follows:
1. Agreement To Sell. Seller agrees to sell, transfer and deliver to Purchaser,
and Purchaser agrees to purchase, upon the terms and conditions hereinafter set
forth, all of the assets of the four (4) businesses of Seller as noted herein.
2. The Assets of the Corporation. It is the understanding of the parties that
Seller is the owner of the following assets (the "Assets"):
(a) the equipment and general assets including patient files, goodwill,
name and records acquired or owned by the business on or before the
closing date (the "General Assets");
(b) the provider agreements noted in Exhibit A-1;
(c) the equipment leases, contracts and agreements described in Exhibit
A-2 hereto (the "Contracts");
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(d) the Contractual Rights which seller has with the Management
Corporations at each of the four (4) locations;
Notwithstanding anything to the contrary contained herein, there shall be
excluded from the Assets, all cash on hand and in Seller's bank accounts and all
patient receivables.
3. Purchase Price. The purchase price to be paid by Purchaser is Twenty Five
Thousand Dollars ($25,000) payable as follows:
(a) Five Thousand Dollars ($5,000) at the closing.
(b) Twenty Thousand Dollars ($20,000) on January 1, 1997
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4. The Closing. The "closing" means the settlement of the obligations of Seller
and Purchaser to each other under this agreement, including the payment of the
purchase price to Seller as provided in Article 3 hereof and the delivery of the
closing documents provided for in Article 5 hereof. The closing shall be held at
the offices of Purchaser and shall take place on or about December 5, 1996 (the
"closing date").
5. Closing Documents. At the closing Sellers shall execute and deliver to
Purchaser:
(a) certified copies of resolutions duly adopted by the Board of Directors
and Shareholder of Seller authorizing the sale of the Assets and the
performance by Seller of its obligations hereunder
(b) an opinion of Seller's counsel, Xxxxxxxxx & Xxxxxxxx of 00 Xxxxxxx
Xxxxxx, Xxxxxxxxx Xxxxxx, XX 00000 dated as of the closing date, in
form and substance satisfactory to Purchaser's counsel, stating such
counsel's opinion that: (i) Corporation is duly organized, validly
existing and in good standing under the laws of New York; (ii) Seller
has full power and authority, corporate and otherwise, to enter into
this agreement and perform its obligations hereunder; (iii) the
execution and delivery of this agreement and the performance by Seller
of its obligations hereunder have been duly authorized by the Board of
Directors and Shareholder of Seller and no further action or approval
is required in order to constitute this agreement as the binding
obligation of Seller, enforceable in accordance with its terms, except
as enforceability may be limited by bankruptcy, moratorium, insolvency
or other laws affecting creditor's rights generally; (iv) the
execution and delivery of this agreement and the performance by Seller
of its obligations hereunder do not and will not violate any provision
of the Certificate of Incorporation or Bylaws of Seller; and (v)
except as may be set forth in this agreement, such counsel is not
representing Seller in any suit, action or proceeding against them
which, if adversely determined, would prohibit the consummation of the
transactions contemplated by this agreement, nor is counsel aware of
any other
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suits, actions or proceedings which would affect this transaction.
(c) the Certificate of Incorporation, Bylaws, filing receipt and other
organizational documents of Seller; any bills, vouchers, and records
showing the ownership of the Assets used in the operations of Seller;
and all other books of account, records and contracts of Seller;
appropriate documentation evidencing the Management Companies'
relationship with Seller and the Assets, including such documentation
as is required to transfer Seller's interest in such Assets,
(d) Restrictive Covenant as enumerated in Article Nine (9),
(e) Statement executed by Seller, releasing and indemnifying Purchaser
from any and all obligations and liabilities of Seller, other than
those specifically assumed herein,
(f) such other instruments and information in form and substance
satisfactory to Purchaser's attorneys as may be necessary or proper to
transfer to Purchaser good and marketable title to all other ownership
interests in the Assets to be transferred under this agreement.
At the closing Seller shall deliver to Purchaser all keys for the businesses. If
any keys for the businesses or Assets are held by employees or others, Seller
shall identify such individuals, their addresses and their relationship to the
Seller. Seller shall do all further acts and things as may be necessary, or
reasonably requested by Purchaser, to consummate the transactions contemplated
by this agreement, including the acquisition of and possession of the Assets.
Seller shall advise Purchaser of, and cause to be delivered to Purchaser, all
applicable trade secrets and proprietary information pertaining to the Assets of
the businesses.
Except as expressly provided herein, Purchaser shall not be obligated to pay or
perform any obligations or liabilities of or Seller including without
limitation, obligations or liabilities of Seller to its creditors or any legal,
accounting, brokerage or finder's fees or any taxes or other expenses in
connection with this agreement or the consummation of the transactions
contemplated hereby.
Purchaser shall execute and deliver to Seller:
Reciprocal documentation and Counsel opinion, as noted in sub paragraphs (a),
(b), (c) above.
6. Representations And Warranties Of Sellers. Seller represents and warrants to
Purchaser as follows:
(a) Seller is a corporation duly organized and validly existing under the
laws of New York, and is duly qualified to do business in New York.
Seller has full power and authority to own its properties and to
conduct its businesses as now carried on, and
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to carry out and perform its undertakings and obligations as provided
herein. The execution and delivery by Seller of this agreement and the
consummation of the transactions contemplated herein have been duly
authorized by the Board of Directors and Shareholder of Seller and
will not conflict with or breach any provision of the Certificates of
Incorporation or Bylaws of Seller, and do not and will not conflict
with or result in any breach of any condition or provision of, or
constitute a default under, or result in the creation or imposition of
any lien, charge or encumbrance upon the Assets by reason of the
provisions of any contract, lien, lease, agreement, instrument or
judgment to which Seller is a party, or which are or purport to be
binding upon Seller or which affect or purport to affect the Assets.
No further action or approval, corporate or otherwise, is required in
order to constitute this agreement the binding and enforceable
obligation of Seller.
(b) No action, approval, consent or authorization, including without
limitation any action, approval, consent or authorization of any
governmental or quasi-governmental agency, commission, board, bureau
or instrumentality, is necessary for Seller to constitute this
agreement the binding and enforceable obligation of Seller or to
consummate the transactions contemplated hereby.
(c) Seller is the owner of and has good and marketable title to the
Assets, free of all liens, claims and encumbrances, except as set
forth herein.
(d) There are no violations, potential claims of violations or questions
of irregularity regarding any law or governmental rule or regulation
pending or, to the best of Seller's knowledge, threatened against
Seller, or the Assets. Seller has complied with all laws and
governmental rules and regulations applicable to the businesses or the
Assets. Seller has duly notified all insurance carriers or third party
payers of any suspected or known claims or potential claims which may
be asserted against Seller or the Assets.
(e) There are no judgments, liens, suits, actions or proceedings pending
or, to the best of Seller's knowledge, threatened against Seller, or
the Assets. Neither Seller nor the Assets are a party to, subject to
or bound by any agreement or any judgment or decree of any court,
governmental body or arbitrator which would conflict with or be
breached by the execution, delivery or performance of this agreement,
or which could prevent the carrying out of the transactions provided
for in this agreement, or which could prevent the use by Purchaser of
the Assets or adversely affect the conduct of the businesses by
Purchaser.
(f) Seller has not entered into, and the Assets are not subject to, any:
(i) written contract or agreement for the employment of any employee
of the business; (ii) contract with any labor union or guild; (iii)
pension, profit-sharing, retirement, bonus, insurance, or similar plan
with respect to any employee of the business; or
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(iv) similar contract or agreement affecting or relating to the
Assets.
(g) At the time of the closing, there will be no (secured or unsecured)
creditors of Seller. General business creditors and equipment lessors
are listed in Exhibit A-3 attached hereto. Except as set forth herein,
Seller shall be liable for all other obligations incurred by Sellers
prior to closing.
(h) Identified Contracts and Equipment Leases are in full force and effect
and without any default by Seller or thereunder. All copies of the
Contracts and Leases provided by Seller to Purchaser are true and
complete copies of the original Contracts. Seller is not indebted
under any executory Contracts or Leases, except as may be set forth in
Exhibit A-3 hereto.
(i) Seller has filed each tax return, including without limitation all
income, excise, property, capital gain, sales, franchise and license
tax returns, required to be filed by Seller prior to the date hereof.
Each such return is true, complete and correct, and Seller has paid
all taxes, assessments and charges of any governmental authority
required to be paid by them and have created reserves or made
provision for all taxes accrued but not yet payable. No government is
now asserting, or to Seller's knowledge threatening to assert, any
deficiency or assessment for additional taxes or any interest,
penalties or fines with respect to Seller. Seller's federal tax
identification numbers is _________________. Seller shall hold
Purchaser harmless and indemnify Purchaser against all claims for
taxes due from and owed by Seller.
At the closing Seller shall execute and deliver an affidavit setting forth the
above representations as of the date of the closing.
7. Representations And Warranties Of Purchaser. Purchaser represents and
warrants to Seller as follows:
(a) Purchaser is a corporation organized under the laws of New York, and
is duly qualified to do business in New York. Purchaser has full power
and authority to carry out and perform its undertakings and
obligations as provided herein. The execution and delivery by
Purchaser of this agreement and the consummation of the transactions
contemplated herein have been duly authorized by the Board of
Directors of Purchaser and will not conflict with or breach any
provision of the Certificate of Incorporation or Bylaws of Purchaser.
No further action or approval, corporate or otherwise, is required in
order to constitute this agreement the binding and enforceable
obligation of Purchaser.
(b) No action, approval, consent or authorization, including without
limitation any action, approval, consent or authorization of any
governmental or quasi-
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governmental agency, commission, board, bureau or instrumentality, is
necessary for Purchaser to constitute this agreement the binding and
enforceable obligation of Purchaser or to consummate the transactions
contemplated hereby.
(c) There are no violations, potential claims of violations or questions
of irregularity regarding any law or governmental rule or regulation
pending or, to the best of Purchaser's knowledge, threatened against
Purchaser. Purchaser has complied with all laws and governmental rules
and regulations applicable to the business. Purchaser has duly
notified all insurance carriers or third party payers of any suspected
or known claims or potential claims which may be asserted against
Purchaser.
(d) There are no judgments, liens, suits, actions or proceedings pending
or, to the best of Purchaser's knowledge, threatened against
Purchaser. Purchaser is not a party to, subject to or bound by any
agreement or any judgment or decree of any court, governmental body or
arbitrator which would conflict with or be breached by the execution,
delivery or performance of this agreement, or which could prevent the
carrying out of the transactions provided for in this agreement.
(e) Purchaser has filed each tax return, including without limitation all
income, excise, property, capital gain, sales, franchise and license
tax returns, required to be filed by Purchaser prior to the date
hereof. Each such return is true, complete and correct, and Purchaser
has paid all taxes, assessments and charges of any governmental
authority required to be paid by them and have created reserves or
made provision for all taxes accrued but not yet payable. No
government is now asserting, or to Purchaser's knowledge threatening
to assert, any deficiency or assessment for additional taxes or any
interest, penalties or fines with respect to Purchaser. Purchaser's
federal tax identification numbers is _________________. Purchaser
shall hold Seller harmless and indemnify Seller against all claims for
taxes due from and owed by Purchaser.
8. Conditions To Closing. The obligations of Purchaser to close hereunder are
subject to the following conditions:
(a) All of the terms, covenants and conditions to be complied with or
performed by Seller under this agreement on or before the closing
shall have been complied with or performed in all material respects.
(b) All representations or warranties of Seller herein are true in all
material respects as of the closing date. Such representations and
warranties shall also survive closing.
(c) Satisfactory results of financial audit, as required by Purchaser.
(d) All Assets are in good working order, as applicable.
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(e) On the closing date, there shall be no liens or encumbrances against
the Assets, except as provided for herein.
(f) The businesses of Seller have been conducted only in the ordinary
course of business. No contracts or purchase agreements/orders will
have been entered into, other than in the ordinary course of business.
No expenditures or credit purchases will be made by Seller other than
in the ordinary course of business.
(g) Seller, and its representatives and advisors will supply, upon request
by Purchaser and its representatives, such pertinent information as
may be required by Purchaser in order to conduct its due diligence
survey of Seller. It is agreed that any documents or information
provided hereunder shall be kept in full and complete confidence.
If this agreement is terminated as provided above in this Article 9, Seller
shall return any payments made by Purchaser on account of the purchase price,
whereupon all rights of Purchaser hereunder and to the businesses shall
terminate, and neither Seller nor Purchaser shall have any further claim against
the other hereunder.
9. Restrictive Covenant Not to Compete. Seller will not, for a period of four
(4) years from the date of closing, either directly or indirectly, engage in the
management or practice of physical therapy or related services, within lower
Westchester County, NY (up to and including latitude of White Plains, NY),
Fairfield County, CT and within a ten (10) mile radius of Seller's current
addresses as listed herein. Sellers shall execute at closing, such documents as
will evidence this surviving provision. To the extent a court of competent
jurisdiction determines this provision to be too restrictive, the Parties agree
to abide by any modification acceptable to such court.
10. Indemnification. Each party hereto shall indemnify and hold the other
parties harmless from and against all liability, claim, loss, damage or expense,
including reasonable attorneys' fees, incurred or required to be paid by such
other parties by reason of any breach or failure of observance or performance of
any representation, warranty, covenant or other provision (including lists and
Exhibits) of this agreement by such party. Seller shall indemnify and hold
Purchaser harmless against all actions, suits, proceedings, judgments, costs and
expenses incurred by or levied against Purchaser, due to Seller's prior acts,
omissions, negligence or other wrongful conduct. Purchaser shall indemnify and
hold Seller harmless against all actions, suits, proceedings, judgments, costs
and expenses incurred by or levied against Seller, due to Purchaser's acts,
omissions, negligence or other wrongful conduct.
11. Risk Of Loss. The risk of loss to the Assets of the businesses sold
hereunder, until the closing, is assumed and shall be borne by Seller. Seller
agrees to keep all of its Assets fully insured against any loss, either by fire,
theft or casualty, to the date of closing. In the event that prior to closing,
such Assets are totally or substantially damaged by reason of fire, theft or
casualty, Purchaser may, in its sole discretion, terminate the within
transaction. In such case, all money heretofore deposited
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with Seller or Seller's representative shall be refunded to Purchaser and the
parties shall be released from any further liability hereunder. If the Purchaser
elects to consummate this transaction despite such loss or damage, it may do so
by paying the purchase price set forth herein, reduced by any insurance proceeds
received by Seller.
12. Brokerage. The parties hereto represent and warrant to each other that they
have not dealt with any broker or finder in connection with this agreement other
than American Health Resources, LLC. Purchaser and Seller shall indemnify,
defend and hold each other harmless from and against any loss, cost, expense,
claim or liability (including, without limitation, reasonable attorney's fees)
arising under or in respect of any claim by any person or entity for any
commission, fee or expense in respect of the transaction contemplated by this
Agreement, where such claim is based in whole or in part upon any act of the
indemnifying party or its representatives. The provisions of this Article shall
survive the expiration, termination or cancellation of this Agreement, but shall
not be construed as a covenant for the benefit of any third party.
13. Individual Seller. Xxxxxx Xxxxxxx hereby confirms all of the representations
and warranties contained herein, and agrees to indemnify and hold Purchaser
harmless from and against misrepresentation or breach of any warranty by Seller
or any breach or failure by Seller to comply with any term, covenant or
condition of this agreement. Shareholder represents and warrants that he is the
shareholder of Seller, and that he has full power and authority to carry out and
perform the undertakings and obligations as provided herein. Shareholder agrees
as aforesaid to induce Purchaser to enter into this agreement. No action or
inaction of Seller or Purchaser, including the giving of notices, shall affect,
change or discharge the obligations of the Purchaser's Guarantor hereunder.
14. Notices. All notices, demands and other communications required or permitted
to be given hereunder shall be in writing and shall be deemed to have been
properly given if delivered by hand or by registered or certified mail, return
receipt requested, with postage prepaid, to Seller's attorneys, Xxxxxxxxx &
Xxxxxxxx at 00 Xxxxxxx Xxxxxx, Xxxxxxxxx Xxxxxx, XX 00000, and to Purchaser's
attorney, Xxxxxxxxx X. Xxxx, Esq., at 0 Xxxxxxx Xxxxx Xxxxx 000, Xxxxx Xxxxxx,
XX 00000. The respective attorneys for the parties hereby are authorized to give
any notice required or permitted hereunder and to agree to adjournments of the
closing.
15. Survival. The representations, warranties and covenant contained herein or
in any document, instrument, certificate or schedule furnished in connection
herewith shall survive the delivery of the Xxxx of Sale and shall continue in
full force and effect after the closing, except to the extent waived in writing.
16. Further Assurances. In connection with the transactions contemplated by this
agreement, the parties agree to execute and deliver such further instruments,
and to take such further actions, as may be reasonably necessary or proper to
effectuate and carry out the transactions contemplated in this agreement.
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17. Changes Must Be In Writing. No delay or omission by either Seller or
Purchaser in exercising any right shall operate as a waiver of such right or any
other right. This agreement may not be altered, amended, changed, modified,
waived or terminated in any respect or particular unless the same shall be in
writing signed by the party to be bound. No waiver by any party of any breach
hereunder shall be deemed a waiver of any other or subsequent breach.
18. Captions And Exhibits. The captions in this agreement are for convenience
only and are not to be considered in construing this agreement. The Exhibits
annexed to this agreement are an integral part of this agreement, and where
there is any reference to this agreement it shall be deemed to include said
Exhibits.
19. Governing Law. This agreement shall be governed by and construed in
accordance with the laws of the State of New York.
20. Binding Effect. This agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, executors,
administrators, successors and assigns.
21. Cancellation. Purchaser reserves the right to cancel this Agreement, without
penalty, if any negative disclosure is discovered regarding Seller, Rotwein or
their Assets, which would materially affect the value of Seller's Assets.
Purchaser forfeits all rights to cancel, subsequent to actual closing.
22. Confidentiality. Each party acknowledges and agrees that any information or
data it has acquired from the other party, not otherwise properly in the public
domain, was received in confidence. Each party hereto agrees not to divulge,
communicate or disclose, except as may be required by law or for the performance
of this Agreement (including conducting due diligence or notifying a party's
lender), or use to the detriment of the disclosing party or for the benefit of
any other person or persons, or misuse in any way, any confidential information
of the disclosing party concerning the subject matter hereof, including any
trade or business secrets of the disclosing party and any technical or business
materials that are treated by the disclosing party as confidential or
proprietary, including without limitation information (whether in written, oral
or machine readable form) concerning: general business operations: methods of
doing business, servicing clients, client relations, and of pricing and making
charge for services and products; financial information, including costs,
profits and sales; marketing strategies; business forms developed by or for the
disclosing party; names of suppliers, personnel, clients and potential clients;
negotiations or other business contacts with suppliers, personnel, clients and
potential clients; form and content of bids, proposals and contracts; the
disclosing party's internal reporting methods; technical and business data and
documentation; software programs, however embodied; diagnostic techniques; and
information obtained by or given to the disclosing party about or belonging to
third parties.
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IN WITNESS WHEREOF, the parties have executed this agreement the date first
above written.
SELLER:
XXXXXX XXXXXXX, P.T., P.C.
ATTEST:
By /s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx
By /s/
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Secretary
PURCHASER:
OAK TREE MEDICAL MANAGEMENT, INC.
ATTEST:
By /s/
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President
By /s/
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Secretary
SHAREHOLDER:
By /s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx
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STATE OF NEW YORK, COUNTY OF WESTCHESTER, SS.:
On the day of November, 1996, before me personally came Xxxxxx Xxxxxxx, to me
known, who being duly sworn, did depose and say that he resides at
; that he is the President Xxxxxx Xxxxxxx, P.T., P.C.,
the corporation described in and which executed the foregoing Agreement of Sale;
and that he signed his name thereto by the order of the board of directors of
the said corporation.
/s/
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Notary Public
My commission expires on
STATE OF NEW YORK, COUNTY OF WESTCHESTER, SS.:
On the day of November, 1996, before me personally came Xxxxxxx Xxxxxxxx, to me
known, who being duly sworn, did depose and say that he resides at
;that he is the President of Oak Tree Medical
Management, Inc. the corporation described in and which executed the foregoing
Agreement of Sale; and that he signed his name thereto by the order of the board
of directors of the said corporation.
/s/
-------------------------------
Notary Public
My commission expires on
STATE OF NEW YORK, COUNTY OF WESTCHESTER, SS.:
On the day of November, 1996, before me personally came Xxxxxx
Xxxxxxx, to me known to be the individual described in and who executed the
foregoing Agreement of Sale, and acknowledged that he executed said Agreement of
Sale.
/s/
-------------------------------
Notary Public
My commission expires on
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EXHIBIT A-1
Provider Agreements
12
EXHIBIT A-2
Equipment, Leases, Contracts
13
