STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT, entered into as of February 21, 1997
(the "Execution Date"), is by and among QPQ CORPORATION, a Florida corporation
(the "Buyer"); XXXX XXXXXXX, M.D., P.A., a Florida professional association (the
"Company"); and, the holders of the Company's capital stock listed on EXHIBIT A
(collectively referred to as the "Stockholders" and individually as a
"Stockholder").
PRELIMINARY STATEMENTS
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1. The Stockholders own of record and beneficially all of the issued
and outstanding capital stock of the Company, consisting of fifty (50) shares of
the Company's Common Stock, zero ($0.00) par value per share (the shares are
referred to in this Agreement as the "Company Shares").
2. The Stockholders desire to sell all of the Company Shares to
Buyer, and Buyer desires to acquire all of the Company Shares.
NOW, THEREFORE, in order to consummate the purchase and sale of the
Company Shares and in consideration of the mutual agreements contained in this
Agreement, the parties agree as follows:
AGREEMENT
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SECTION 1
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SALE OF SHARES AND PURCHASE PRICE
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1.1 TRANSFER OF COMPANY SHARES. At the Closing, each Stockholder shall
deliver or cause to be delivered to Buyer certificates representing all of the
Company Shares owned by that Stockholder, as listed on Exhibit A. Those stock
certificates shall be duly endorsed in blank for transfer or shall be presented
with stock powers duly executed in blank, with signature guarantees and other
documents which may be reasonably required by Buyer to effect a valid transfer
of the Company Shares by the Stockholders, free and clear of any and all liens,
encumbrances, charges or claims. Each Stockholder, by execution of this
Agreement, appoints Buyer as his attorney-in-fact to effectuate transfer of the
Company Shares at the Closing (as defined below).
1.2 PURCHASE PRICE AND PAYMENT. In consideration of the sale by
Stockholders to Buyer of the Company Shares, in reliance upon the
representations and warranties of the Company and the Stockholders contained in
this Agreement and made at the Closing, and subject to the satisfaction of all
of the conditions contained in this Agreement, Buyer agrees that at the Closing
it will deliver to each Stockholder the amount specified in EXHIBIT A-1 by bank
cashier check or by wire transfer of immediately available funds (the "Closing
Funds") plus a promissory note in substantially the same form as specified in
Exhibit A-1. The Closing Funds and promissory note, when added together, shall
be collectively, the 'Purchase Price".
1.3 TIME AND PLACE OF CLOSING. The closing of the purchase and sale
provided for in this Agreement (the "Closing") shall be held at the offices of
Buyer at 0000 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxx Xxxxx, Xxxxxxx on February 12,
1997 or at another place or an earlier or later date or time as may be mutually
agreed upon by the parties.
1.4 FURTHER ASSURANCES. The Stockholders from time to time after the
Closing, at the request of Buyer and without further consideration, shall
execute and deliver further instruments of transfer and assignment and take all
other action as Buyer may reasonably require to more effectively transfer and
assign to, and vest in, Buyer the Company Shares and all rights to the Company
Shares, and to fully implement the provisions of this Agreement.
SECTION 2
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REPRESENTATIONS AND WARRANTIES
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OF THE COMPANY AND STOCKHOLDERS
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2.1 MAKING OF REPRESENTATIONS AND WARRANTIES. As a material inducement
to Buyer to enter into this Agreement and consummate the contemplated
transactions, the Company and each of the Stockholders jointly and severally
make to Buyer the representations and warranties contained in this Section 2;
provided, however, that no Stockholder shall have any right of indemnity or
contribution from the Company with respect to any breach of representation or
warranty under this Agreement.
2.2 ORGANIZATION AND QUALIFICATIONS OF THE COMPANY. The Company is a
professional association duly organized, validly existing and in good standing
under the laws of Florida with full corporate power and authority to own or
lease its properties and to conduct its business in the manner and in the places
where those properties are owned or leased or that business is currently
conducted or proposed to be conducted. The copies of the Company's Articles of
Incorporation as amended to date, certified by Florida's Secretary of State, and
of the Company's by-laws, as amended to date, certified by the Company's
Secretary, and delivered to Buyer's counsel, are complete and correct, and no
amendments to them are pending. The Company is not in violation of any term of
its Articles of Incorporation or By-laws. The Company is not required to be
licensed or qualified to conduct its business or own its property in any other
jurisdiction.
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2.3 CAPITAL STOCK OF THE COMPANY; BENEFICIAL OWNERSHIP.
(a) The authorized capital stock of the Company consists of fifty (50)
shares of Common Stock, zero ($0.00) par value per share, of which fifty (50)
shares are duly and validly issued, outstanding, fully paid and non-assessable
and of which zero (0) shares are authorized but unissued. There are no
outstanding options, warrants, rights, commitments, preemptive rights or
agreements of any kind for the issuance or sale of, or outstanding securities
convertible into, any additional shares of capital stock of any class of the
Company. None of the Company's capital stock has been issued in violation of any
federal or state law. Except as described in SCHEDULE 2.3(A), there are no
voting trusts, voting agreements, proxies or other agreements, instruments or
undertakings with respect to the voting of the Company Shares to which the
Company or any of the Stockholders is a party.
(b) Stockholder owns beneficially and of record all of the Company
Shares free and clear of any liens, restrictions or encumbrances.
2.4 AUTHORITY OF THE COMPANY. The Company has full right, authority
and power to enter into this Agreement and each agreement, document and
instrument to be executed and delivered by the Company pursuant to this
Agreement and to carry out the contemplated transactions. The execution,
delivery and performance by the Company of this Agreement and each other
agreement, document and instrument have been duly authorized by all necessary
action of the Company and no other action on the part of the Company or the
Stockholders is required. This Agreement and each agreement, document and
instrument executed and delivered by the Company pursuant to this Agreement
constitutes, or when executed and delivered will constitute, valid and binding
obligations of the Company enforceable in accordance with their terms. The
execution, delivery and performance by the Company of this Agreement and each
agreement, document and instrument:
(a) does not and will not violate any provision of the Articles of
Incorporation or by-laws of the Company;
(b) does not and will not violate any laws of the United States, or
any state or other jurisdiction applicable to the Company or require the Company
to obtain any approval, consent or waiver of, or make any filing with, any
person or entity (governmental or otherwise) that has not been obtained or made;
and
(c) does not and will not result in a breach of, constitute a default
under, accelerate any obligation under, or give rise to a right of termination
of any indenture or loan or credit agreement or any other agreement, contract,
instrument, mortgage, lien, lease, permit, authorization, order, writ, judgment,
injunction, decree, determination or arbitration award to which the Company is a
party or by which the property of the Company is bound or affected, or result in
the creation or imposition of any mortgage, pledge, lien, security interest or
other charge or encumbrance on any of the Company's assets or the Company
Shares, except as specifically identified on SCHEDULE 2.4(III).
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2.5 REAL AND PERSONAL PROPERTY.
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(a) LEASED REAL PROPERTY. All of the real property leased by the
Company is identified on SCHEDULE 2.5(A) (referred to as the "Leased Real
Property").
(b) PERSONAL PROPERTY. A complete description of the machinery,
furniture, personalty and equipment of the Company is contained in SCHEDULE
2.5(B). Except as specifically disclosed in that Schedule or in the Base Balance
Sheet (as defined below), the Company has good and marketable title to all of
its personal property. None of the Company's personal property or assets is
subject to any mortgage, pledge, lien, conditional sale agreement, security
title, encumbrance or other charge except as specifically disclosed in that
Schedule or in the Base Balance Sheet. The Base Balance Sheet reflects all
personal property of the Company. Except as otherwise specified in SCHEDULE
2.5(B), all leasehold improvements, furnishings, machinery, personalty and
equipment of the Company are in good repair, have been well maintained, and
substantially comply with all applicable laws, ordinances and regulations, and
those furnishings, personalty, machinery and equipment are in good working
order. Neither the Company nor any of the Stockholders knows of any pending or
threatened change of any law, ordinance or regulation which could adversely
affect the Company, or any of its businesses.
2.6 FINANCIAL STATEMENTS. The Company has delivered to Buyer Form 1120 for
the years ended 9/30/96 and 9/30/95 which are prepared on the cash method of
accounting and copies of which are attached as SCHEDULE 2.6 . These tax returns
are complete and correct in all material respects and present fairly in all
material respects the financial condition of the Company at the dates of those
statements and the results of its operations for the periods covered thereby. As
of the date of the last tax return, the Company had no liabilities (which
liabilities, when taken individually or in the aggregate, were material) of any
nature, whether accrued, absolute, contingent or otherwise, asserted or
unasserted, known or unknown (including without limitation, liabilities as
guarantor or otherwise with respect to obligations of others, liabilities for
taxes due or then accrued or to become due, or contingent or potential
liabilities relating to activities of the Company or the conduct of its business
prior to September 30, 1996.
As of the Execution Date and as of the date of the Closing, the Company
has not had and will not have any liabilities of any nature, whether accrued,
absolute, contingent or otherwise, asserted or unasserted, known or unknown
(including without limitation, liabilities as guarantor or otherwise with
respect to obligations of others, or liabilities for taxes due or then accrued
or to become due or contingent or potential liabilities relating to activities
of the Company or the conduct of its business prior to Execution Date or the
date of the Closing, as the case may be, regardless of whether claims had been
asserted as of those dates), except liabilities: (i) reflected in Schedules
furnished to Buyer under this Agreement on the Execution Date; or, (ii) incurred
after the date of the last tax return in the ordinary course of business of the
Company consistent with the terms of this Agreement.
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2.7 TAXES.
(a) The Company has paid or caused to be paid all federal, state, local,
foreign, and other taxes, including without limitation, income taxes, estimated
taxes, alternative minimum taxes, excise taxes, sales taxes, use taxes,
value-added taxes, gross receipts taxes, franchise taxes, capital stock taxes,
employment and payroll-related taxes, withholding taxes, stamp taxes, transfer
taxes, windfall profit taxes, environmental taxes and property taxes, whether or
not measured in whole or in part by net income, and all deficiencies, or other
addition to tax, interest, fines and penalties owed by it (collectively,
"Taxes"), required to be paid by it through the Execution Date, whether disputed
or not.
(b) The Company has, in accordance with applicable law filed all federal,
state, local and foreign tax returns required to be filed by it through the
Execution Date, and all these returns correctly and accurately contain the
amount of any Taxes relating to the applicable period. A list of all federal,
state, local and foreign income tax returns filed with respect to the Company
for taxable periods ended on or after September 30, 1994 is provided in Schedule
2.7(B), and that Schedule indicates those returns that have been audited or
currently are the subject of an audit. For each taxable period of the Company
ended on or after September 30, 1994 the Company has delivered to Buyer correct
and complete copies of all federal, state, local and foreign income tax returns,
examination reports and statements of deficiencies assessed against or agreed to
by the Company.
(c) Neither the Internal Revenue Service nor any other governmental
authority is now asserting or, to the knowledge of the Company or any
Stockholder, threatening to assert against the Company any deficiency or claim
for additional Taxes. No claim has ever been made by an authority in a
jurisdiction where the Company does not file reports and returns that the
Company is or may be subject to taxation by that jurisdiction. There are no
security interests on any of the assets of the Company that arose in connection
with any failure (or alleged failure) to pay any Taxes. The Company has never
entered into a closing agreement pursuant to Section 7121 of the Internal
Revenue Code of 1986, as amended (the "Code").
(d) Except as described in SCHEDULE 2.7(D), there has not been any audit
of any tax return filed by the Company, no audit is in progress, and the Company
has not been notified by any tax authority that any audit is contemplated or
pending. Except as described in Schedule 2.7(D): (I) no extension of time with
respect to any date on which a tax return was or is to be filed by the Company
is in force; (ii) no waiver or agreement by the Company is in force for the
extension of time for the assessment or payment of any Taxes; and, (iii) no
agreement with any taxing authority is in force for an extension of the statute
of limitations for an audit.
(e) The Company has never been (or has never had any liability for unpaid
Taxes because it once was) a member of an "affiliated group" (as defined in
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Section 1504(a) of the Code). Except as described in Schedule 2.7(E), the
Company has never filed, and has never been required to file, a consolidated,
combined or unitary tax return with any other entity. Except as described in
SCHEDULE 2.7(E), the Company does not own and has never owned a direct or
indirect interest in any trust, partnership, corporation or other entity. Except
as described in SCHEDULE 2.7(E), the Company is not a party to any tax sharing
agreement.
(f) For purposes of this Agreement, all references to Sections of the Code
shall include any predecessor provisions to those Sections and any similar
provisions of federal, state, local or foreign law.
2.8 COLLECTABILITY OF ACCOUNTS RECEIVABLE. All of the accounts receivable
of the Company less than 90 days old existing at the Execution Date (less the
reserve for bad debts set forth on the Base Balance Sheet) are or will be at the
Closing valid and enforceable claims, fully collectible and subject to no setoff
or counterclaim, subject to historic discounts and reductions. The Company has
no accounts or loans receivable from any person, firm or corporation which is
affiliated with the Company or from any director, officer or employee of the
Company, except as disclosed on SCHEDULE 2.8, and all accounts and loans
receivable from any of these persons, firms or corporations shall be paid in
cash prior to the Closing.
2.9 ABSENCE OF CERTAIN CHANGES. Except as disclosed in SCHEDULE 2.9, since
the date September 30, 1996 there has not been:
(a) Any change in the financial condition, properties, assets,
liabilities, business or operations of the Company, which change by itself or in
conjunction with all other changes, whether or not arising in the ordinary
course of business, has been materially adverse with respect to the Company;
(b) Any contingent liability incurred by the Company as guarantor or
otherwise with respect to the obligations of others or any cancellation of any
material debt or claim owing to, or waiver of any material right of the Company;
(c) Any mortgage, encumbrance or lien placed on any of the properties of
the Company which remains in existence on the Execution Date or will remain on
the Closing Date;
(d) Any obligation or liability of any nature, whether accrued, absolute,
contingent or otherwise, asserted or unasserted, known or unknown (including
without limitation liabilities for Taxes due or to become due or contingent or
potential liabilities relating to services provided by the Company or the
conduct of the business of the Company since September 30, 1996 regardless of
whether claims have been asserted), incurred by the Company;
(e) Other than in the ordinary course, any purchase, sale or other
disposition, or any agreement or other arrangement for the purchase, sale or
other disposition, of any of the properties or assets of the Company or the
Company's business;
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(f) Any damage, destruction or loss, whether or not covered by insurance,
materially and adversely affecting the properties, assets or business of the
Company;
(g) Any declaration, setting aside or payment of any dividend by the
Company, or the making of any other distribution in respect of the capital stock
of the Company, or any direct or indirect redemption, purchase or other
acquisition by the Company of its own capital stock;
(h) Any labor trouble or claim of unfair labor practices involving the
Company; any change in the compensation payable or to become payable by the
Company to any of its officers, employees, agents or independent contractors
other than normal merit increases in accordance with its usual practices; or any
bonus payment or arrangement made to or with any of its officers, employees,
agents or independent contractors;
(i) Any change with respect to the officers or management of the Company;
(j) Any payment or discharge of a material lien or liability of the
Company which was not shown on the or incurred in the ordinary course of
business thereafter;
(k) Any obligation or liability incurred by the Company to any of its
officers, directors, stockholders or employees, or any loans or advances made by
the Company to any of its officers, directors, stockholders or employees, except
normal compensation and expense allowances payable to officers or employees;
(l) Any change in accounting methods or practices, credit practices or
collection policies used by the Company;
(m) Any other transaction entered into by the Company other than
transactions in the ordinary course of business; or
(n) Any agreement or understanding whether in writing or otherwise, for
the Company to take any of the actions specified in paragraphs (a) through (m)
above.
2.10 ORDINARY COURSE. Since the date of the Base Balance Sheet, the
Company has conducted its business only in the ordinary course and consistently
with its prior practices.
2.11 BANKING RELATIONS. All of the arrangements which the Company has with
any banking institution are completely and accurately described in SCHEDULE
2.11, indicating with respect to each of these arrangements the type of
arrangement maintained (e.g., checking account, borrowing arrangements, safe
deposit box, etc.) and the person or persons authorized.
2.12 INTELLECTUAL PROPERTY.
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(a) Except as described in SCHEDULE 2.12(A), the Company has exclusive
ownership of, or exclusive license to use, all patent, copyright, trade secret,
trademark, or other proprietary rights (collectively, "Intellectual Property")
used or to be used in the business of the Company as presently conducted or
contemplated. All of the rights of the Company in the Intellectual Property are
freely transferable. There are no claims or demands of any other person
pertaining to any. of the Intellectual Property and no proceedings have been
instituted, or are pending or threatened, which challenge the rights of the
Company. The Company has the right to use, free and clear of claims or rights of
other persons, all patient lists, processes, computer software, systems, data
compilations, research results and other information required for or incident to
its services or its business as presently conducted or contemplated.
(b) All patents, patent applications, trademarks, trademark applications
and registrations and registered copyrights which are owned by or licensed to
the Company or used or to be used by the Company in its business as presently
conducted or contemplated, and all other items of Intellectual Property which
are material to the business or operations of the Company, are listed in
SCHEDULE 2.12(B).
(c) All licenses or other agreements under which the Company is granted
rights in Intellectual Property are listed in SCHEDULE 2.12(C). All these
licenses or other agreements are in full force and effect, there is no material
default by any party to those licenses or agreements, and, except as described
in SCHEDULE 2.12(C), all of the rights of the Company under those licenses and
agreements are freely assignable. To the knowledge of Company, the licensors
under these licenses and other agreements have and had all requisite power and
authority to grant the rights purported to be conferred thereby. True and
complete copies of all these licenses or other agreements, and any amendments to
them, have been provided to Buyer.
(d) All licenses or other agreements under which the Company has granted
rights to others in Intellectual Property owned or licensed by the Company are
listed in SCHEDULE 2.12(D). All of these licenses or other agreements are in
full force and effect, there is no material default by any party to them, and,
except as described on SCHEDULE 2.12(D), all of the rights of Company under
those licenses and agreements are freely assignable. True and complete copies of
all licenses or other agreements, and any amendments to them, have been provided
to Buyer.
(e) The Company has taken all steps required in accordance with sound
business practice to establish and preserve its ownership of all Intellectual
Property rights with respect to its services and technology.
(f) The present and contemplated business, activities and products of the
Company do not infringe any Intellectual Property of any other person. No
proceeding charging the Company with infringement of any adversely held
Intellectual Property has been filed or is threatened to be filed. The Company
is not making unauthorized use of any confidential information or trade secrets
of any person, including without limitation, any former employer of any past or
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present employee of Company. Except as described in SCHEDULE 2.12(F), neither
the Company nor, to the knowledge of the Company and the Stockholders, any of
their employees have any agreements or arrangements with any persons other than
the Company related to confidential information or trade secrets of those
persons or restricting any employee's ability to engage in business activities
of any nature.
2.13 CONTRACTS. Except for contracts, commitments, plans, agreements and
licenses described in Schedule 2.13 (true and complete copies of which have been
delivered to Buyer), neither the Company, all of the physicians, nurses,
technicians and allied health care professionals employed or engaged by the
Company (those individuals shall be collectively, the "Health Care Providers")
nor any Stockholder is a party to or subject to:
(a) any plan or contract providing for bonuses, pensions, options, stock
purchases, deferred compensation, retirement payments, profit sharing,
collective bargaining or the like, or any contract or agreement with any labor
union;
(b) any employment contract or contract for services which requires the
payment of more than One Thousand Dollars ($1,000.00) annually or which is not
terminable within thirty (30) days by the Company without liability for any
penalty or severance payment;
(c) any contract or agreement for the purchase of any service, commodity,
material or equipment, except as otherwise disclosed in another schedule to this
Agreement;
(d) any other contracts or agreements creating any obligations of the
Company not specifically disclosed elsewhere under this Agreement;
(e) any contract or agreement which by its terms does not terminate or is
not terminable without penalty by the Company or its successors within one year
after the Execution Date;
(f) any contract containing covenants limiting the freedom of the Company
to compete in any line of business or with any person or entity;
(g) any contract or agreement for the purchase of any fixed asset whether
or not that purchase is in the ordinary course of business;
(h) any license agreement (as licensor or licensee);
(i) any indenture, mortgage, promissory note, loan agreement, guaranty or
other agreement or commitment for the borrowing of money which directly or
indirectly may affect the Company;
(j) any contract or agreement with any officer, employee, director or
stockholder of the Company or with any persons or organizations controlled by or
affiliated with any of them; or
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(k) any contracts, agreements and understandings (collectively, the
"Provider Agreements") with any party regarding the provision of medical
services to patients, including without limitation, any Provider Agreements with
HMOs, PPOS, third party payors, IPAS, PHOS, MSOS, employers, labor unions,
hospitals, clinics, ambulatory surgery centers, Medicare intermediaries and
Medicaid intermediaries.
The Company is not in default under any contracts, commitments, plans,
agreements or licenses described in that Schedule nor has any knowledge of
conditions or facts which with notice or passage of time, or both, would
constitute a default.
2.14 LITIGATION, INVESTIGATIONS, ORDERS AND DECREES . Except as listed on
Schedule 2.14 or SCHEDULE 2.15, there are no actions, suits, claims,
governmental investigations or arbitration proceedings pending or, to the best
of the Company's knowledge, threatened against or affecting the Stockholders,
the Company's employed or engaged physicians, nurses, technicians and allied
health care professional (individually, a "Health Care Provider" and
collectively, the "Health Care Providers") , the Company or the business,
assets, prospects or financial condition of the Company or the Stockholders that
may have an adverse effect on the Company, the Health Care Providers or the
Stockholders or any of the Company's assets, and to the best of the Company's
knowledge, there are no facts or circumstances which are reasonably likely to
create a basis for any of the foregoing. Except as listed on Schedule 2.14,
there are no outstanding orders, decrees or stipulations issued by any local,
state or federal judicial authority in any proceeding to which the Company or
any of the Health Care Providers or the Stockholders are or were a party which
may have an adverse effect on any of them. Except as set forth on SCHEDULE 2.14,
neither the Company nor any of its Affiliates (as defined in Section 2.22) has
any claims against any of the Health Care Providers or the Stockholders and none
of the Health Care Providers or the Stockholders have any claims against the
Company or any of its Affiliates, and to the best of the Company's and the
Stockholders' knowledge, there are no facts or circumstances which are
reasonably likely to create a basis for any of the foregoing.
2.15 MEDICAL MALPRACTICE. Except as set forth on SCHEDULE 2.15, there are
no pending, and to the best of the Company's knowledge and belief, there are no
threatened litigation, arbitration, claim or governmental, administrative or
other proceedings (formal or informal), including, without limitation, any
malpractice claims, Health Care Financing Administration, Agency for Health Care
Administration, Office of the Inspector General, Department of Insurance,
Department of Professional Regulation or Board of Medicine investigations,
suits, notices of intent to institute, arbitration or proceedings, either
administrative or judicial, involving the Company, the Stockholders or any of
the Health Care Providers.
2.16 INSURANCE. The physical properties and assets of the Company are
insured to the extent disclosed in SCHEDULE 2.16 (including all professional
liability insurance policies) and all those insurance policies and arrangements
are disclosed in that Schedule. Those insurance policies and arrangements are in
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full force and effect, all premiums with respect to those policies and
arrangements are currently paid, and the Company is in compliance in all
material respects with their terms. That insurance is adequate and customary for
the business engaged in by the Company and is sufficient for compliance by the
Company with all requirements of law and all agreements and leases to which the
Company is a party.
2.17 EQUITY INVESTMENTS. Except as set forth on SCHEDULE 2.17, neither the
Company nor any of the Stockholders own, directly or indirectly, of record or
beneficially, either directly or indirectly, any capital stock, other equity,
ownership or proprietary interest in any corporation, partnership, association,
trust, joint venture or other entity engaged in any business related to the
health care industry.
2.18 POWERS OF ATTORNEY. Neither the Company nor any Stockholder has any
outstanding power of attorney.
2.19 FINDER'S FEE. Except as provided in Schedule 2.19, the Company has
not incurred or become liable for any broker's commission or finder's fee
relating to or in connection with the transactions contemplated by this
Agreement.
2.20 LICENSES; PERMITS; COMPLIANCE. The Company and each of the
Stockholders and Health Care Providers possess all licenses and other required
governmental or official approvals, permits, consents and authorizations (as
listed on SCHEDULE 2.20 attached to this Agreement), the failure of which to
possess would, individually or in the aggregate, have a material adverse effect
on the business, financial condition, operations, prospects or results of
operations of the Company. The Company, the Health Care Providers and the
Stockholders are in compliance with: (i) the terms of all contractual
obligations which directly or indirectly affect the Company; (ii) all laws,
ordinances, statutes and regulations where noncompliance could have an adverse
effect on the Company or its businesses, prospects or assets; and, (iii) all
judgments, orders, rulings or other decisions of any governmental or other
regulatory authority, court or arbitrator having jurisdiction over the
Stockholders or the Company. The Company has furnished to Buyer true and correct
copies of all correspondence from all governmental authorities asserting that
the Company, the Health Care Providers or the Stockholders are not, was not or
may not have been in compliance with all applicable laws, rules, regulations,
judgments, orders or decrees.
2.21 CORPORATE RECORDS; COPIES OF DOCUMENTS. The corporate record books of
the Company accurately record all corporate action taken by the stockholders and
board of directors and committees. The copies of the corporate records of the
Company, as made available to Buyer for review, are true and complete copies of
the originals of those documents. The Company has made available for inspection
and copying by Buyer and its counsel true and correct copies of all documents
referred to in this Section or in the Schedules delivered to Buyer pursuant to
this Agreement.
2.22 TRANSACTIONS WITH INTERESTED PERSONS. Except as disclosed on SCHEDULE
2.22, neither the Company nor any of its "Affiliates" (such term shall
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hereinafter have the meaning set forth in Rule 405 promulgated by the SEC under
the Securities Act of 1933, as amended), nor the Stockholders nor any of the
Stockholders, Affiliates have any direct or indirect material interest or
familial or business relationship in any of the Stockholders, or the Company's
customers, patients, suppliers, vendors, payors or landlords. All of the
Company's rights with respect to the Assets are based upon and derived from
arm's length transactions unrelated to any of their Affiliates and all of the
Assumed Obligations do not exceed the fair market value of the products,
services or rights being received in exchange toy the discharge of those
obligations.
2.23 EMPLOYEE BENEFIT PROGRAMS.
(a) SCHEDULE 2.23 to this Agreement sets forth a list of every Employee
Program (as defined below) that has been maintained (as that term is further
defined below) by the Company since its inception.
Each Employee Program which has been maintained by the Company and which
has at any time been intended to qualify under Section 401(a) or 501(c)(9) of
the Internal Revenue Code of 1986, as amended (the "Code"), has received a
favorable determination or approval letter from the IRS regarding its
qualification under that section and has, in fact, been qualified under the
applicable section of the Code from the effective date of that Employee Program
through and including the Closing (or, if earlier, the date that all of such
Employee Program B assets were distributed). No event or omission has occurred
which would cause any Employee Program to lose its Qualification under the
applicable Code section.
There has not been any failure of any party to comply with any laws
applicable with respect to the Employee Programs that have been maintained by
the Company. With respect to any Employee Program now or heretofore maintained
by the Company, there has occurred no "prohibited transaction," as defined in
Section 406 of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or Section 4975 of the Code, or breach of any duty under ERISA or
other applicable law (including, without limitation, any health care
continuation requirements or any other tax law requirements, or conditions to
favorable tax treatment, applicable to such plan), which could result, directly
or indirectly (including without limitation through any obligation of
indemnification or contribution), in any taxes, penalties or other liability to
the Company or any Affiliate (as defined below). No litigation, arbitration, or
governmental administrative proceeding (or investigation) or other proceeding
(other than those relating to routine claims for benefits) is pending or, to the
best knowledge of the Company and the Stockholders, threatened with respect to
any Employee Program.
The Company has not incurred any liability under Title IV of ERISA which
has not be paid in full prior to the Closing. There has been no "accumulated
funding deficiency" (whether or not waived) with respect to any Employee Program
ever maintained by the Company and subject to Code Section 412 or ERISA Section
302. With respect to any Employee Program maintained by the Company and subject
to Title IV of ERISA, there has been no (nor will be any as a result of the
12
transaction contemplated by this Agreement) (i) "reportable event," within the
meaning of ERISA Section 4043, or the regulations thereunder (for which notice
the notice requirement is not waived under 29 C.F.R. Part 2615); or, (ii) event
or condition which presents a material risk of plan termination or any other
event that may cause the Company to incur liability or have a lien imposed on
its assets under Title IV of ERISA. All payments and/or contributions required
to have been made (under the provisions of any agreements or other governing
documents or applicable law) with respect to all Employee Programs ever
maintained by the Company, for all periods prior to the Closing, either have
been made or have been accrued. No Employee Program maintained by the Company
and subject to Title IV of ERISA (other than a Multiemployer Plan) has any
"unfunded benefit liabilities" within the meaning of ERISA Section 4001(a)(18),
as of the Closing Date. The Company has not ever maintained a Multiemployer
Plan. None of the Employee Programs ever maintained by the Company has ever
provided health care or any other non-pension benefits to any employees after
their employment was terminated (other than as required by part 6 of subtitle B
of title I of ERISA) or has ever promised to provide those post-termination
benefits.
The Company and each Employee Program that is a welfare plan subject to
Part 6 of Title I of ERISA and Code Section 4980B, as applicable, have complied
in all material respects with their respective requirements of such statutes in
each and every case. There is no provision in any of Company's Employee Programs
or in any other agreement that would preclude the Company from amending or
terminating any of its Employee Programs.
With respect to each Employee Program maintained by the Company within the
past five years, complete and correct copies of the following documents (if
applicable to that Employee Program) have previously been delivered to Buyer:
(i) all documents embodying or governing that Employee Program, and any funding
medium for the Employee Program (including, without limitation, trust
agreements) as they may have been amended to the date hereof; (ii) the most
recent IRS determination or approval letter with respect to such Employee
Program under Code Section 401 or 501(c)(9), and any applications for
determination or approval subsequently filed with the IRS; (iii) the three most
recently filed IRS Forms 5500, with all applicable schedules and accountants'
opinions attached thereto; (iv) the summary plan description for such Employee
Program (or other descriptions of such Employee Program provided to employees)
and all modifications thereto; (v) any insurance policy (including any fiduciary
liability insurance policy) related to such Employee Program; (vi) any documents
evidencing any loan to an Employee Program that is a leveraged employee stock
ownership plan; and (vii) with respect to any Multiemployer Plan, any
participation or adoption agreement relating to the Company's participation in
or contributions under such plan.
Each Employee Program maintained by the Company as of the date of this
Agreement is subject to termination by the Board of Directors of the Company
without any further liability or obligation on the part of the Company to make
further contributions to any trust maintained under any such Employee Program
following such termination.
13
For purposes of this SECTION 2.23:
(i) "Employee Program" means (A) all employee benefit plans
within the meaning of ERISA Section 3(3), including, but not limited to,
multiple employer welfare arrangements (within the meaning of ERISA Section
3(40)), plans to which more than one unaffiliated employer contributes and
employee benefit plans (such as foreign or excess benefit plans) which are not
subject to ERISA; and (B) all stock option plans, bonus or incentive award
plans, severance pay policies or agreements, deferred compensation agreements,
supplemental income arrangements, vacation plans, and all other employee benefit
plans, agreements, and arrangements not described in (A) above. In the case of
an Employee Program funded through an organization described in Code Section
501(c)(9), each reference to such Employee Program shall include a reference to
such organization;
(ii) an entity "maintains" an Employee Program if such entity
sponsors, contributes to, or provides (or has promised to provide) benefits
under such Employee Program, or has any obligation (by agreement or under
applicable law) to contribute to or provide benefits under such Employee
Program, or if such Employee Program provides benefits to or otherwise covers
employees of such entity (or their spouses, dependents, or beneficiaries);
(iii) An entity is an "Affiliate" of the Company for purposes
of this Section 2.23 if it would have ever been considered a single employer
with the Company under ERISA Section 4001(b) or part of the same "controlled
group" as the Company for purposes of ERISA Section 302(d)(8)(C); and,
(iv) "Multiemployer Plan" means a (pension or non-pension)
employee benefit plan to which more than one employer contributes and which is
maintained pursuant to one or more collective bargaining agreements.
2.24 ENVIRONMENTAL MATTERS. Except as provided in SCHEDULE 2.24 and except
for biohazardous materials which have been disposed of in compliance with all
applicable laws and regulations, neither the Company nor any of the Stockholders
has ever generated, transported, used, stored, treated, disposed of, or managed
any Hazardous Waste (as defined below); and (i) no Hazardous Material (as
defined below) has ever been or is threatened to be spilled, released, or
disposed of at any site presently or formerly owned, operated, leased, or used
by the Company or the Stockholders, or has come to be located in the soil or
groundwater at any such site; (ii) no Hazardous Material has ever been
transported from any site presently or formerly owned, operated, leased, or used
by the Company or the Stockholders for treatment, storage, or disposal at
any-other place; (iii) neither the Company nor any of the Stockholders presently
owns, operates, leases, or uses, nor has either of them ever owned, operated,
leased, or used any site on which underground storage tanks are or were located;
and, (iv) no lien ever has been imposed by any governmental agency or any
property, facility, machinery, or equipment owned, operated, leased, or used by
the Company or the Stockholders in, connection with the presence of any
Hazardous Material.
14
Neither the Company nor any of the Stockholders has any liability under,
nor has the Company or any of the Stockholders ever violated in any material
respect, any Environmental Law (as defined below); and: (i) the Company and the
Stockholders and any property owned, operated, leased, or used by the Company
and any facilities and operations on that property, are presently in compliance
in all respects with all applicable Environmental Laws; (ii) neither the Company
nor any of the Stockholders has ever entered into or been subject to any
judgment, consent, decree, compliance order, or administrative order with
respect to any environmental or health and safety matter or received any request
for information, notice, demand letter, administrative inquiry, or formal or
informal compliant or claim with respect to any environmental or health and
safety matter or the enforcement of any Environmental Law; and, (iii) the
Company has no reason to believe that any of the items enumerated in clause (ii)
of this paragraph will be forthcoming.
No site owned, operated, leased, or used by the Company contains any
asbestos or asbestos-containing material, any polychlorinated biphenyls (PCBS)
or equipment containing PCBS, or any urea formaldehyde foam insulation.
The Company and the Stockholders have provided to Buyer copies of all
documents, records, and information available to the Company or the Stockholders
concerning any environmental or health or safety matter relevant to the Company
or the Stockholders, whether generated by others or by the Company, including,
without limitation, environmental audits, environmental risk assessments, site
assessments, documentation regarding off-site disposal of Hazardous Materials,
spill control is plans, and reports, correspondence, permits, licenses,
approvals, consents, and other authorizations related to environmental or health
or safety matters issued by any governmental agency.
For purposes of this Section 2.24: (i) "Hazardous Material,, shall mean
and include any hazardous material, hazardous substance, petroleum product, oil,
toxic substance, pollutant, or contaminant, as defined or regulated under any
Environmental Law, or any other substance which may pose a threat to the
environmental or to human health or safety, including without limitation,
bio-hazardous materials; (ii) "Hazardous Waste" shall mean and include any
hazardous waste as defined or regulated under any Environmental Law; (iii)
"Environmental Law" shall mean any environmental or health and safety-related
law, regulation, rule, ordinance, or by-law at the foreign, federal, state, or
local level, whether existing as of the date of this Agreement, previously
enforced, or subsequently enacted; and (iv) the Company shall mean and include
the Company, its respective predecessors and all other entities for whose
conduct the Company is or may be held responsible under any Environmental Law.
2.25 LIST OF DIRECTORS AND OFFICERS. SCHEDULE 2.25 contains a true and
complete list of all current directors and officers of the Company. in addition,
SCHEDULE 2.25 contains a list of all managers, employees and consultants of the
Company who, individually, have received or are scheduled to receive
compensation from the Company for the period ending December 31, 1996. In each
case that Schedule shall include the current job title and aggregate annual
compensation of each individual.
15
2.26 DISCLOSURE; ACCURACY OF DOCUMENTS AND EXHIBITS. The representations,
warranties and statements contained in this Agreement and in the certificates,
exhibits and schedules delivered by the Company pursuant to this Agreement to
Buyer do not contain any untrue statement of a material fact, and, when taken
together, do not omit to state a material fact required to be stated therein or
necessary in order to make those representations, warranties or statements not
misleading in light of the circumstances under which they were made. There are
no facts known to the Company or any Stockholder which presently or may in the
future have a material adverse affect on the business, properties, prospects,
operations or condition of the Company which have not been specifically
disclosed in this Agreement or in a Schedule furnished with this Agreement,
other than general economic conditions affecting the health care industry.
All contracts, instruments, agreements and other documents delivered by
the Company and the Stockholders to Buyer or its agents for Buyer's or its
agents, review in connection with this Agreement and the contemplated
transactions, including articles of incorporation, by-laws, corporate minutes,
stock record books and tax returns, are true, correct and complete copies of all
those contracts, instruments, agreements and other documents. All Exhibits and
Schedules to this Agreement are true, correct and complete as of the Closing.
2.27 NON-FOREIGN STATUS. The Company is not a "foreign person" within the
meaning of Section 1445 of the Code and Treasury Regulations Section 1.1445-2.
2.28 EMPLOYEES; LABOR MATTERS; REGULATORY COMPLIANCE The Company employs
the Stockholder and a total of twelve (12) full-time employees and one (1)
part-time employee and-generally enjoys good employer-employee relationships.
The Company is not delinquent in payments to any of its employees for any wages,
salaries, commissions, bonuses or other direct compensation for any services
performed for it through the Execution Date or amounts required to be reimbursed
to those employees. Upon termination of the employment of any of those
employees, neither the Company, nor Buyer will by reason of the transactions
contemplated under this Agreement or anything done prior to the Closing be
liable to any of those employees for so-called "severance pay" or any other
payments, except as described in SCHEDULE 2.28. The Company has no policy,
practice, plan or program of paying severance pay or any form of severance
compensation in connection with the termination of employment, except as
described in that Schedule. The Company is in compliance with all applicable
laws and regulations including, without limitation, labor laws, employment laws,
fair employment practice laws, occupational health and safety laws, disabilities
laws, sexual harassment laws, work place safety and health laws, terms and
conditions of employment and wage and hours laws and environmental laws. There
are no charges of employment discrimination or unfair labor practices, nor are
there any strikes, slowdowns, stoppages of work, or any other concerted
interference with normal operations which are existing, pending or threatened
against or involving the Company. No question concerning labor representation
exists respecting any employees of the Company. There are no grievances,
complaints or charges that have been filed against the Company under any dispute
resolution procedure (including, but not limited to, any proceedings under any
16
dispute resolution procedure under any collective bargaining agreement) that
might have an adverse effect on the Company or the conduct of its business, and
there is no arbitration or similar proceeding pending and no claim therefor has
been asserted. No collective bargaining agreement is in effect or is currently
being or is about to be negotiated by the Company. The Company has not received
any information indicating that any of its employment policies or practices is
currently being audited or investigated by any federal, state or local
government agency. The Company is, and at all times since November 6, 1986 has
been, in compliance with the requirements of the Immigration Reform Control Act
of 1986.
2.29 PROVIDER AGREEMENTS; SUPPLIERS; CHANGES. SCHEDULE 2.29 sets forth any
third party payor arrangement or agreement or Provider Agreement which accounts
for more than one percent (1%) of the collections of the Company for the twelve
months ended September 30, 1996. The relationships of the Company with its TPAs
are good commercial working relationships. None of the TPAs has cancelled,
materially modified, or otherwise terminated its relationship with the Company,
or has during the last twelve months decreased materially its use of the
services of the Company, nor to the knowledge of Company, do any TPAs have any
plan or intention to do any of the foregoing. Further, the Company has not
received notice that any health plan, insurance company, employer or any other
TPA which has done business with the Company since January 1, 1996 intends to
terminate, limit or restrict its relationship with the Company.
2.30 TRANSFER OF SHARES. No holder of stock of the Company has at any time
transferred any stock to any employee of the Company, which transfer constituted
or could be viewed as compensation for services rendered to the Company by that
employee.
2.31 STOCK REPURCHASE. The Company has not redeemed or repurchased any of
its capital stock. There has been no employee compensation by any means not
reflected in the financial statements.
2.32 LICENSING AND CREDENTIAL INFORMATION. Attached as EXHIBIT B to this
Agreement are complete and accurate copies of all licenses and all credentialing
documents and correspondence relating to or about the Company and the Health
Care Providers. The Company and the Health Care Providers are duly licensed
under the laws of the State of Florida and have complied with all laws, rules
and regulations relating to the rendering of services in their respective
specialty areas. No Health Care Provider has ever: (i) had his or her
professional license, Drug Enforcement Agency number, Medicare provider status
or staff privileges at any hospital or medical facility suspended, relinquished,
terminated or revoked; (ii) been reprimanded, sanctioned or disciplined by any
licensing board or any federal, state or local society or agency, governmental
body, hospital, third party payor or specialty board; or, (iii) had a final
judgment or settlement without judgement entered against him or her in
connection with a malpractice or similar action for an amount in excess of Five
Thousand Dollars ($5,000.00).
17
2.33 HEALTH CARE FACILITIES. The Company and the Health Care Providers
maintain in good standing staff memberships or similar affiliations with the
health care facilities (the "Health Care Facilities") as described on SCHEDULE
2.33.
2.34 GOOD HEALTH. To the best of the Company's knowledge, all of the
employed and engaged Health Care Providers are in good physical and mental
health for their respective ages and do not suffer from any illnesses or
disabilities which could prevent any of them from fulfilling their
responsibilities under the respective contracts, agreements or understandings
with the Company. To the best of the Company's and the Stockholders' knowledge,
none of the employed and engaged Health Care Providers use or abuse any
controlled substances at any time or are under the influence of alcohol or are
affected by the use of alcohol during the time period required to perform their
duties and obligations under any contracts, agreements or understandings with
the Company.
SECTION 3
---------
Not Used in this Agreement
SECTION 4
---------
RESTRICTIVE COVENANTS
---------------------
4.1 MAKING OF COVENANTS AND AGREEMENTS. The Company and the Stockholders
jointly and severally hereby make the covenants and agreements in this Section 4
and the Stockholders agree to cause the Company to comply with those agreements
and covenants. No Stockholder shall have any right of indemnity or contribution
from the Company with respect to the breach of any covenant or agreement under
this Agreement.
4.2 RESTRICTIVE COVENANTS. The Stockholders recognize that to assure the
Buyer that it will realize the value inherent in the transactions contemplated
in connection with this Agreement (including, but not limited to, the
acquisition of the Company's medical practice on a "going concern" basis),.it is
necessary for the Stockholders to enter into this Agreement. The Stockholders
also acknowledge that the terms of this Agreement are inherently reasonable in
all respects, notwithstanding the fact that the terms of this Agreement could
restrict them from earning income in the field in which they currently practice.
Accordingly, each of the Stockholders agrees with the Buyer that for a five-year
period following the Closing Date anywhere within five (5) miles from any
location where any of the Stockholders provided Physician Services (the
"Restricted Area"); either on their own behalf or as a principal, partner,
stockholder, officer, employee, agent, consultant, independent contractor,
director or trustee of any person, partnership, entity, firm or corporation or
otherwise:
(a) except in their capacity as employees of the Buyer, own, manage,
operate, control or otherwise engage an a Competing Business (as defined below),
or receive any compensation in any capacity from any Competing Business;
18
(b) other than as a patient himself or as the Buyer directs, have any
business relationship, in any capacity whatsoever, with any IPA, PHO, or any
other form of an integrated delivery system, competing medical practice or
medical services delivery system which is operated in or affiliated in any
manner with medical practices in the Restricted Area;
(c) attempt to solicit or solicit the patients or facilities serviced by
the Buyer to terminate, curtail or restrict their relationship with the Buyer or
attempt to provide or provide those patients or facilities with medical services
previously furnished to them by any of the Stockholders while employed by the
Buyer during the Term of their Employment Agreements and any Renewal Terms;
(d) otherwise divert or attempt to divert from the Buyer any business or
business opportunity whatsoever; or,
(e) attempt to solicit or solicit any person employed or contracted by the
Buyer, or any of their affiliates, to leave their employment or not fulfill
their contractual responsibility, whether or not the employment or contracting
is full-time or temporary, pursuant to a written or oral agreement, or for a
determined period or at will.
The term "Competing Business" shall mean any business which is competitive
with the Buyer, which is specifically agreed to by the parties to be the
management, provision and operation of medical services, the operation and
management of a management services organization ("MSO") available for contract
to physicians, hospitals, healthcare facilities, integrated delivery systems,
PHOS, IPAs and physician networks; and, the acquisition and operation of primary
care and specialty physician offices.
4.3 RESTRICTIVE COVENANT REMEDIES. Each of the Stockholders acknowledge
that: (i) a breach by the Company or any of the Stockholders of the provisions
of Section 4.2 would cause the Buyer irreparable harm; and, (ii) monetary
damages in an action at law would not provide an adequate remedy in the event of
a breach. Accordingly, the Stockholders, jointly and severally, agree that, in
addition to any other remedies (legal, equitable or otherwise) available to the
Buyer, Buyer may seek and obtain injunctive relief against the breach or
threatened breach of the provisions of Section 4.2 (without the necessity of any
bond or other security being posted) as well as all other rights and remedies
available at law and equity including, without limitation, the right to be
indemnified by the Stockholders for all claims, damages, actions, suits
whatsoever for a breach of Section 4.2 and if the Buyer prevails in that action,
its reasonable attorneys' fees, expenses and costs incurred in enforcing any
provisions of Section 4.2. at pretrial, trial and appellate levels. Nothing
contained in this Section 4.3 shall be construed as prohibiting the Buyer and
all other injured parties from pursuing all other remedies available to them for
a breach or threatened breach of the provisions of Section 4.2.
The Stockholders further acknowledge and agree that the covenants
contained in this Article are necessary for the protection of the Buyer's
19
legitimate business and professional duties, ethical obligations and interests,
and are reasonable in scope and content. In the event of any breach or violation
by the Stockholders of any of the provisions of Section 4.7, the running of such
five-year period (but not the Company's and any of the Stockholders, obligations
thereunder) shall be tolled during the continuation of any breach or violation.
4.4 TERMINATION OF EMPLOYMENT AGREEMENT. In the event the Employment
Agreement entered into between Stockholder and Buyer is terminated by
Stockholder due to Company's breach, and Company has failed to remedy such
breach in accordance with the terms and conditions of the Employment Agreement,
then Sections 4.2 and 4.3 shall not apply to Stockholder.
4.5 NO SOLICITATION OF OTHER OFFERS. Neither the Company, the
Stockholders, nor any of their representatives will, directly or indirectly,
solicit, encourage, assist, initiate discussions or engage in negotiations with,
provide any information to, or enter into any agreement or transaction with, any
person, other than Buyer, relating to the possible acquisition of the Company
Shares, the Company, or any of its assets.
4.6 CONFIDENTIALITY. The Company and the Stockholders agree that, unless
and until the Closing has been consummated, each of the Company, the
Stockholders and their officers, directors, agents and representatives will hold
in strict confidence, and will not use, any confidential or proprietary data or
information obtained from Buyer with respect to its business or financial
condition except for the purpose of evaluating, negotiating and completing the
transaction contemplated hereby. Information generally known in Buyer's industry
or which has been disclosed to the Company, or the Stockholders by third parties
which have a right to do so shall not be deemed confidential or proprietary
information for purposes of this agreement. If the transaction contemplated by
this Agreement is not consummated, the Company, and the Stockholders will return
to Buyer (or certify that they have destroyed) all copies of data and
information, including but not limited to financial information, customer lists,
business and corporate records, worksheets, test reports, tax returns, lists,
memoranda, and other documents prepared by or made available to the Company or
the Stockholders in connection with the transaction.
4.7 TAX RETURNS. The Company and the Stockholders shall cooperate with
Buyer to permit the Company in accordance with applicable law to promptly
prepare and file on or before the due date or any extension of all federal,
state and local tax returns required to be filed by the Company with respect to
taxable periods ending on or before the Closing.
SECTION 5
REPRESENTATIONS AND WARRANTIES OF BUYER
5.1 MAKING OF REPRESENTATIONS AND WARRANTIES. As a material inducement to
the Company and the Stockholders to enter into this Agreement and consummate the
20
contemplated transactions, Buyer hereby makes the representations and warranties
to the Company and the Stockholders contained in this Section 5.
5.2 ORGANIZATION OF BUYER. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of Florida with full corporate
power to own or lease its properties and to conduct its business in the manner
and in the places where those properties are owned or leased or that business is
conducted by it.
5.3 AUTHORITY OF BUYER. Buyer has full right, authority and power to enter
into this Agreement, and each agreement, document and instrument to be executed
and delivered by Buyer pursuant to this Agreement and to carry out the
contemplated transactions. The execution, delivery and performance by Buyer of
this Agreement, and each other agreement, document and instrument have been duly
authorized by all necessary corporate action of Buyer and no other action on the
part of Buyer is required in connection therewith. This Agreement, and each
other agreement, document and instrument executed and delivered by Buyer
pursuant to this Agreement constitute, or when executed and delivered will
constitute, valid and binding obligations of Buyer enforceable in accordance
with their terms.
(a) does not and will not violate any provision of the Articles of
Incorporation or by- laws of Buyer.
(b) does not and will not violate any laws of the United States or of any
state or any other jurisdiction applicable to Buyer or require Buyer to obtain
any approval, consent or waiver of, or make any filing with, any person or
entity (governmental or otherwise) which has not been obtained or made; and,
(c) does not and will not result in a breach of , constitute a default
under, accelerate any obligation under, or give rise to a right of termination
of any indenture, loan or credit agreement, or other agreement mortgage, lease,
permit, order, judgment or decree to which Buyer is a party and which is
material to the business and financial condition of Buyer and its parent and
affiliated organizations on a consolidated basis.
5.4 LITIGATION. There is no litigation or, to its knowledge, threatened
against Buyer which would prevent or hinder the consummation of the transactions
contemplated by this Agreement.
5.5 FINDER'S FEE. Buyer has not incurred or become liable for any broker's
commission or finder's fee relating to or in connection with the transactions
contemplated by this Agreement.
5.6 SOLVENCY OF BUYER. Buyer is solvent as of the date of this Agreement
and paying its bills as they become due.
21
SECTION 6
---------
COVENANTS OF BUYER
------------------
6.1 MAKING OF COVENANTS AND AGREEMENT. Buyer hereby makes the covenants
and agreements in this Section 6.
6.2 CONFIDENTIALITY. Buyer agrees that, unless and until the Closing has
been consummated, Buyer and its officers, directors, agents and representatives
will hold in strict confidence, and will not use any confidential or proprietary
data or information obtained from the Company or the Stockholders with respect
to the business or financial condition of the Company except for the purpose of
evaluation, negotiating and completing the transaction contemplated . hereby.
Information generally known in the industries of the Company or which has been
disclosed to Buyer by third parties which have a right to do so shall not be
deemed confidential or proprietary information for purposes of this Agreement.
If the transaction contemplated by this Agreement is not consummated, Buyer will
return to the Company (or certify that it has destroyed) all copies of data and
information, including but not limited to financial information, customer lists,
business and corporate records, worksheets, test reports, tax returns, lists,
memoranda, and other documents prepared by or made available to Buyer in
connection with the transaction.
6.3 CONSUMMATION OF AGREEMENT. Buyer shall use its best efforts to perform
and fulfill all conditions and obligations on its part to be performed and
fulfilled under this agreement, to the end that the transactions contemplated by
this agreement shall be fully carried out. To this end, Buyer will obtain prior
to the Closing all necessary authorizations or approvals of its Board of
Directors.
SECTION 7
---------
CONDITIONS FOR CLOSING AND
PROCEDURE FOR CLOSING
---------------------
7.1 CONDITIONS TO THE OBLIGATIONS OF BUYER. The obligation of Buyer to
consummate this Agreement and the contemplated transactions are subject to the
fulfillment, prior to or at the Closing, of the following conditions precedent:
(a) REPRESENTATIONS; WARRANTIES; COVENANTS. Each of the representations
and warranties of the Company and the Stockholders contained in this Agreement
shall be true and correct as of the date of this Agreement and as of the Closing
Date as though made on and as of the Closing; and the Company and each of the
Stockholders shall, on or before the Closing, have performed all of their
obligations under this Agreement which by the terms are to be performed on or
before the Closing.
(b) NO MATERIAL CHANGE. There shall have been no material adverse change
in the financial condition, prospects, properties, assets, liabilities, business
or operations of the Company since the Execution Date, whether or not in the
ordinary course of business.
22
(c) APPROVAL OF BUYER'S COUNSEL. All actions, proceedings, instruments and
documents required to carry out this Agreement and the contemplated transactions
and all related legal matters contemplated by this Agreement shall have been
approved by counsel for Buyer, and that counsel shall have received on behalf of
Buyer all other certificates, opinions, and documents in form satisfactory to
counsel, as Buyer may reasonably require from the Company and the Stockholders
to evidence compliance with the terms and conditions of this Agreement as of the
Closing and the correctness as of the Closing of the representations and
warranties of the Stockholders and the Company and the fulfillment of their
respective covenants.
(d) NO LITIGATION. There shall have been no determination by Buyer, acting
in good faith, that the consummation of the transactions contemplated by this
Agreement has become inadvisable or impracticable by reason of the institution
or threat by any person or any federal, state or other governmental authority of
litigation, proceedings or other action against Buyer, the Company or
Stockholder or any material adverse change in the laws or regulations applicable
to the Company.
(e) CONSENTS. The Company or the Stockholders shall have made all filings
with and notifications of governmental authorities, regulatory agencies and
other entities required to be made by the Company or the Stockholders in
connection with the execution and delivery of this Agreement, the performance of
the contemplated transactions and the continued operation of the business of the
Company by Buyer subsequent to the Closing; and the Company, the Stockholders
and Buyer shall have received all authorizations, waivers, consents and permits,
in form and substance reasonably satisfactory to Buyer, from all third parties,
including, without limitation, applicable governmental authorities, regulatory
agencies, lessors, lenders and contract parties, required to permit the
continuation of the business of the Company and the consummation of the
transactions contemplated by this Agreement, and to avoid a breach, default,
termination, acceleration or modification of any material indenture, loan or
credit agreement or any other material agreement, contract, instrument,
mortgage, lien, lease, permit, authorization, order, writ, judgment, injunction,
decree, determination or arbitration award as a result of, or in connection
with, the execution and performance of this Agreement.
(f) EMPLOYEE PROGRAMS. The Company shall have taken all steps necessary
under the relevant documents and applicable law to maintain the qualification of
each Employee Program identified on SCHEDULE 2.23 notwithstanding the purchase
of the Company Shares by Buyer.
(g) RESIGNATIONS. The Company shall have delivered to Buyer the
resignations of all of the Directors of the Company and of all officers of the
Company as may be requested by Buyer at least five days prior to the Closing,
those resignations to be effective at the Closing.
23
(h) SATISFACTION OF OBLIGATIONS. On or before the Closing Date, the
Company shall have paid in full all of its outstanding debts and obligations,
including without limitation, all pension plan contribution, professional fees
(accounting and legal fees), taxes and accounts payable and the Company shall
provide the Buyer with evidence of those satisfactions.
7.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY AND THE STOCKHOLDERS. The
obligation of the Company and the Stockholders to consummate this Agreement and
the contemplated transactions is subject to the fulfillment, prior to or at the
Closing, of the following conditions precedent:
(a) REPRESENTATIONS; WARRANTIES; COVENANTS. Each of the representations
and warranties of Buyer contained in Section 5 shall be true and correct in all
material respects as through made on and as of the Closing and Buyer shall, on
or before the Closing, have performed all of its obligations under this
Agreement which by the terms are to be performed on or before the Closing.
(b) APPROVAL OF THE COMPANY'S COUNSEL. All actions, proceedings,
instruments and documents required to carry out this Agreement and the
contemplated transactions and all related legal matters contemplated by this
agreement shall have been approved by Xxxxxxx X. Xxxxxxxxxx, Esq. of Xxxxxx
Xxxxxx, et. al. in its capacity as counsel for the Company and the Stockholders,
and that counsel shall have received on behalf of the Company and the
Stockholders all other certificates, opinions and documents in form satisfactory
to that counsel as the Company may reasonably require from Buyer to evidence
compliance with the terms and conditions of this Agreement as of the Closing and
the correctness as of the Closing of the representations and warranties of Buyer
and the fulfillment of its covenants.
(c) NO LITIGATION. There shall have been no determination by the Company,
acting in good faith, that the consummation of the transactions contemplated by
this Agreement has become inadvisable or impracticable by reason of the
institution or threat by any person or any federal, state or other governmental
authority of material litigation, proceedings or other action against Buyer, the
Company, or any Stockholder.
7.3 PROCEDURE AT THE CLOSING. At the Closing, the parties agree to take
the following steps in the order listed below (provided, however, that upon
their completion all of these steps shall be deemed to have occurred
simultaneously):
(a) legal counsel for the Company and the Stockholders shall deliver a
legal opinion to the Buyer in substantially the form of EXHIBIT C attached to
this Agreement;
(b) legal counsel for the Buyer shall deliver a legal opinion to the
Company and the Stockholders in substantially the form of EXHIBIT G attached to
this Agreement;
(c) the Company shall execute and deliver resolutions adopted by the board
of directors of the Company approving the transactions contemplated by this
Agreement, certified by the corporation secretary of the Company;
24
(d) the Buyer shall execute and deliver resolutions adopted by the board
of directors of the Buyer approving the transactions contemplated by this
Agreement, certified by the corporation secretary of the Buyer;
(e) the Company shall deliver to the Buyer a Certificate of the Company's
President dated as of the Closing to the effect that the statements contained in
Sections 7.1(a) and (b) are true and correct;
(f) the Buyer shall deliver to the Company a Certificate of the Buyer's
President dated as of the Closing Date to the effect that the statements
contained in Section 7.2(a) are true and correct;
(g) the Buyer shall deliver the Closing Funds to the Company;
(h) each of the Stockholders shall execute and deliver to the Buyer a
Physician Employment Agreement, in substantially the form of EXHIBIT D attached
to this Agreement;
(i) the Company and each of the Stockholders shall execute and deliver to
the Buyer general releases of all claims which any of them may have against the
Company in he form of Exhibit F attached to this Agreement;
(j) each of the Stockholders shall deliver their respective stock
certificates to the Buyer and shall execute and deliver stock powers of attorney
and any other documentation necessary to effectuate a transfer of their shares
of Company Stock to the Buyer;
(k) the Buyer hall deliver to the Company a Certificate of Good Standing
issued by the Secretary of State of Florida; and,
(n) the Company shall deliver to the Buyer a Certificate of Good Standing
of Florida.
SECTION 8
---------
TERMINATION OF AGREEMENT; RIGHTS TO PROCEED
-------------------------------------------
This section not used.
SECTION 9
---------
25
RIGHTS AND OBLIGATIONS SUBSEQUENT TO CLOSING
--------------------------------------------
9.1 SURVIVAL OF WARRANTIES. Each of the representations, warranties,
agreements, covenants and obligations in this Agreement or in any schedule,
exhibit, certificate or financial statement delivered by any party to the other
party incident to the contemplated transactions are material, shall be deemed to
have been relied upon by the other party and shall survive the Closing for a
period of one year, except that any representation, warranty or covenant in
relation to federal, state, local, foreign and all other taxes shall survive the
Closing for a period of three years regardless of any investigation and shall
not merge in the performance of any obligation by either party to this
Agreement.
SECTION 10
----------
INDEMNIFICATION
---------------
10.1 INDEMNIFICATION BY THE STOCKHOLDERS. The Stockholders jointly and
severally agree subsequent to the Closing to indemnify and hold the Company,
Buyer and its subsidiaries and affiliates and persons serving as officers,
directors, partners or employees of the Company or Buyer (individually a "Buyer
Indemnified Party" and collectively the "Buyer Indemnified Parties") harmless
form and against any damages, liabilities, losses, taxes, fines, penalties,
costs, and expenses (including, without limitation, reasonable fees of counsel)
of any kind or nature whatsoever (whether or not arising out of third-party
claims and including all amounts paid in investigation, defense or settlement of
the foregoing) which may be sustained or suffered by any of them arising out of
or based upon any of the following matters:
(a) fraud, intentional misrepresentation or a deliberate or wilful breach
by the Company or any Stockholder of any of their representations, warranties or
covenants under this Agreement or in any certificate, schedule or exhibit
delivered pursuant to this Agreement;
(b) any other breach of any representation, warranty or covenant of the
Company or any Stockholder under this Agreement or in any certificate, schedule
or exhibit delivered pursuant to this Agreement, or by reason of any claim,
action or proceeding asserted or instituted growing out of any matter or thing
constituting a breach of those representations, warranties or covenants; and
(c) any liability of the Company for Taxes arising from an event or
transaction prior to the Closing or as a result of the Closing which have not
been paid or provided for by the Company, including without limitations, any
increase in Taxes due to the unavailability of any loss or deduction claimed by
the Company.
10.2 LIMITATIONS ON INDEMNIFICATION BY THE STOCKHOLDERS. No
indemnification shall be payable pursuant to Subsection 10.1(b) above to any
Buyer Indemnified Party, unless the total of all claims for indemnification
pursuant to Section 10.1 shall exceed Ten Thousand Dollars ($10,000.00) in the
aggregate, whereupon the full amount of claims shall be recoverable in
accordance with the terms of this Agreement.
26
10.3 INDEMNIFICATION BY BUYER. Buyer agrees to indemnify and hold the
Stockholders (individually a "Stockholder Indemnified Party" and collectively
the "Stockholder Indemnified Parties") harmless from and against any damages,
liabilities, losses and expenses (including, without limitation, reasonable fees
of counsel) of any kind or nature whatsoever (whether or not arising out of
third-party claims and including all mounts paid in investigation, defense or
settlement of the foregoing) which may be sustained or suffered by any of them
arising out of or based upon any breach of any representation, warranty or
covenant made by Buyer in this Agreement or in any certificate delivered by
Buyer under this Agreement, or by reason of any claim, action or proceeding
asserted or instituted growing out of any matter or thing constituting that
breach, including, without limitation, fraud, intentional misrepresentation or a
deliberate or wilful breach by the Buyer of any of its representations,
warranties or covenants under this Agreement or in any certificate, schedule or
exhibit delivered pursuant to this Agreement;
10.4 LIMITATION ON INDEMNIFICATION BY BUYER. No indemnification pursuant
to Section 10.3 shall be payable to the Stockholders, unless the total of all
claims for indemnification pursuant to Section 10.3 shall exceed Ten Thousand
Dollars ($10,000.00) in the aggregate, whereupon the full amount of all claims
shall be recoverable in accordance with the terms of this Agreement.
10.5 NOTICE; DEFENSE OF CLAIMS. An indemnified party may make claims for
indemnification under this Agreement by giving written notice of the claim to
the indemnifying party within the period in which indemnification claims can be
made under this Agreement. The notice shall summarize the bases for the claim
for indemnification and any claim or liability being asserted by a third party.
Within twenty (20) days after receiving any notice, the indemnifying party shall
give written notice to the indemnified party stating whether it disputes the
claim for indemnification and whether it will defend against any third party
claim or liability at its own cost and expense. If the indemnifying party fails
to give notice that it disputes an indemnification claim within twenty (20) days
after receipt of notice of the claim, it shall be deemed to have accepted and
agreed to the claim, which shall become immediately due and payable. The
indemnifying party shall be entitled to direct the defense against a third party
claim or liability with counsel selected by it (subject to the consent of the
indemnified party, which consent shall not be unreasonably withheld) as long as
the indemnifying party is conducting a good faith and diligent defense. The
indemnified party shall at all times have the right to fully participate in the
defense of a third party claim or liability at its own expense directly or
through counsel; provided, however, that if the named parties to the action or
proceeding include both the indemnifying party and the indemnified party and the
indemnified party is advised that representation of both parties by the same
counsel would be inappropriate under applicable standards of professional
conduct, the indemnified party may engage separate counsel at the expense of the
indemnifying party. If no notice of intent to dispute and defend a third party
claim or liability is given by the indemnifying party, or if that good faith and
27
diligent defense is not being or ceases to be conducted by the indemnifying
party, the indemnified party shall have the right, at the expense of the
indemnifying party, to undertake the defense of that claim or liability (with
counsel selected by the indemnified party), and to compromise or settle it,
exercising reasonable business judgment. If the third party claim or liability
is one that by its nature cannot be defended solely by the indemnifying party,
then the indemnified party shall make available all information and assistance
as the indemnifying party may reasonably request and shall cooperate with the
indemnifying party in that defense, at the expense of the indemnifying party.
SECTION 11
----------
MISCELLANEOUS
-------------
11.1 FEES AND EXPENSES. Each of the parties will bear its own expenses in
connection with the negotiation and the consummation of the transactions
contemplated by this Agreement, and no expenses of the Company, or the
Stockholders relating in any way to the purchase and sale of the Company Shares
under this Agreement and the contemplated transactions, including without
limitation legal, accounting or other professional expenses of the Company or
Stockholder, shall be charged to or paid by the Company or Buyer.
11.2 GOVERNING LAW. This Agreement shall be construed under and governed
by the internal laws of the State of Florida without regard to its conflict of
laws provisions.
11.3 NOTICES. Any notice, request, demand or other communication required
or permitted under this Agreement shall be in writing and shall be deemed to
have been given if delivered or sent by facsimile transmission, upon receipt, or
if sent by registered or certified mail, upon the sooner of the date on which
receipt is acknowledged or the expiration of three days after deposit in United
States post office facilities properly addressed with postage prepaid. All
notices to a party will be sent to the addresses listed below or to any other
address or person as a party may designate by notice to each other party under
this Agreement:
if to the Buyer: QPQ Corporation
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxx Xxxxx, Xxxxxxx
Attention: Xxxxxxxx Xxxxxxxx
Chairman/CEO
with a copy to: Xxxxxxx & Xxxxx, P.A.
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx, XX 00000
28
if to the Company or:
Stockholder than Xxxx X. Xxxxxxx, M.D.
0000 Xxxxxx Xxxxx Xxxxx
Xxx. 0000
Xxxxxxxx, XX 00000
with a copy to: Xxxxxxx Xxxxxxxxxx, Esq.
Geiger,Kasdin, Heller, Kuperstein,
Xxxxxx & Weil, P.A.
0000 Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxx, XX 00000
Any notice given under this Agreement may be given on behalf of any party
by his counsel or other authorized representatives.
11.4 ENTIRE AGREEMENT. This Agreement, including the Schedules and
Exhibits referred to in this Agreement and the other writings specifically
identified in this Agreement or contemplated by this Agreement, is complete,
reflects the entire agreement of the parties with respect to its subject matter,
and supersedes all previous written or oral negotiations, commitments and
writings. No promises, representations, understandings, warranties and
agreements have been made by any of the parties to this Agreement except as
referred to in this Agreement or in its Schedules and Exhibits or in other
writings; and all inducements to the making of this Agreement relied upon by
either party to this Agreement have been expressed in this Agreement or in the
Schedules or Exhibits or in other writings.
11.5 ASSIGNABILITY; BINDING EFFECT. This Agreement shall only be
assignable by Buyer to a corporation or partnership controlling, controlled by
or under common control with Buyer upon written notice to the Company and the
Stockholders. This Agreement may not be assigned by the Stockholders or the
Company without the prior written consent of Buyer. This Agreement shall be
binding upon and enforceable by, and shall inure to the benefit of, the parties
to this Agreement and their respective successors and permitted assigns.
11.6 CAPTIONS AND GENDER. The captions in this Agreement are for
convenience only and shall not affect the construction or interpretation of any
term or provision of this Agreement. The use in this Agreement of the masculine
pronoun in reference to a party to this Agreement shall be deemed to include the
feminine or neuter, as the context may require.
11.7 EXECUTION IN COUNTERPARTS. For the convenience of the parties and to
facilitate execution, this Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same document.
29
11.8 AMENDMENTS. This Agreement may not be amended or modified, nor may
compliance with any condition or covenant contained in this Agreement be waived,
except by a writing duly and validly executed by each party to this Agreement,
or in the case of a waiver, the party waiving compliance.
11.9 This Section not used.
11.10 SEVERABILITY. The invalidity or unenforceability of any one or more
of the words, phrases, sentences, clauses, or sections contained in this
Agreement shall not affect the validity or enforceability of the remaining
provisions of this Agreement or any part of any provision, all of which are
inserted conditionally on their being valid in law, and in the event that any
one or more of the words, phrases, sentences, clauses or sections contained in
this Agreement shall be declared invalid or unenforceable, this Agreement shall
be construed as if the invalid or unenforceable word or words, phrase or
phrases, sentence or sentences, clause or clauses, or section or sections had
not been inserted or shall be enforced as nearly as possible according to their
original terms to eliminate any invalidity or unenforceability. If any
invalidity or unenforceability is caused by the length of any period of time or
the size of any area contained in any part of this Agreement, the period of time
or area, or both, shall be considered to be reduced to a period or area which
cure the invalidity or unenforceability.
11.11 LITIGATION; PREVAILING PARTY. Except as otherwise required by
applicable law or as expressly provided in this Agreement, in the event of any
litigation, including appeals, with regard to this Agreement, the prevailing
party shall be entitled to recover from the non-prevailing party all reasonable
fees, costs, and expenses of counsel (at pre-trial, trial and appellate levels).
11.12 PUBLICITY. Subject to applicable law, all press releases and other
publicity, except as required by applicable law, concerning the transactions,
contemplated by this Agreement will be subject to the review and approval of the
Company, the Stockholders and the Buyer, provided that the approval shall not be
unreasonably withheld or delayed.
11.13 NO BREACH. The parties agree that the execution of this Agreement
shall not be deemed to be an assignment of any contract where consent to that
assignment is required by the terms of that contract provided that the foregoing
shall not affect the Company's and the Stockholders' respective obligations to
obtain all consents as provided in this Agreement.
11.14 CONSTRUCTION. This Agreement shall be construed without regard to
any presumption or other rule requiring construction against the party causing
this Agreement to be drafted, including any presumption of superior knowledge or
responsibility based upon a party's business or profession or any professional
training, experience, education or degrees of any member, agent, officer of
employee of any party. If any words in this Agreement have been stricken out or
otherwise eliminated (whether or not any other words or phrases have been added)
and the stricken words initialed by the party against whom the words are
construed, then this Agreement shall be construed as if the words so stricken
out or otherwise eliminated were never included in this Agreement and no
implication or inference shall be drawn from the fact that those words were
stricken out or otherwise eliminated.
30
11.15 JURISDICTION; VENUE; INCONVENIENT FORUM; JURY TRIAL.
---------------------------------------------------
ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT, OR ANY JUDGMENT
ENTERED BY ANY COURT IN RESPECT TO THIS AGREEMENT SHALL BE BROUGHT IN THE COURTS
OF THE STATE OF FLORIDA OR IN THE U.S. DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF FLORIDA IN DADE COUNTY, AND THE PARTIES ACCEPT THE EXCLUSIVE PERSONAL
JURISDICTION OF THOSE COURTS FOR THE PURPOSE OF ANY SUIT, ACTION OR PROCEEDING.
IN ADDITION, THE PARTIES KNOWINGLY, INTENTIONALLY AND IRREVOCABLY WAIVE, TO THE
FULLEST EXTENT PERMISSION BY LAW, ANY OBJECTION WHICH THEY MAY NOW OR LATER HAVE
TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT, OR ANY JUDGMENT ENTERED BY ANY COURT BROUGHT IN THE
STATE OF FLORIDA, AND FURTHER, KNOWINGLY, INTENTIONALLY AND IRREVOCABLY WAIVE
ANY CLAIM THAT ANY SUIT, ACTION OR PROCEEDING BROUGHT IN THE STATE OF FLORIDA
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH PARTY WAIVES ALL RIGHTS TO ANY
TRIAL BY JURY IN ALL LITIGATION RELATING TO OR ARISING OUT OF THIS AGREEMENT.
SECTION 12
----------
FURTHER REPRESENTATIONS AND WARRANTIES OF BUYER
-----------------------------------------------
12.1 REPRESENTATION AND WARRANTIES OF BUYER. Until the promissory note
described in EXHIBIT A-1 (the "Note") has been paid in full and Stockholder's
employment with the Buyer pursuant to the Employment Agreement between Buyer and
Stockholder (the "Employment Agreement") terminates, other than without cause by
the Stockholder or for cause by Buyer, or its term expires, Buyer represents and
warrants to Stockholder the following:
(a) The Company shall be maintained in good standing with the
Secretary of State of the State of the Florida and its status shall remain
active;
(b) The Buyer shall grant a first lien security interest in the
Assets and in the 50 shares of no par value common stock of the Company owned by
the Buyer (the "Shares") pursuant to a Pledge and Security Agreement attached
hereto as Exhibit E; and
(c) The current malpractice insurance policy of the Company and the
Stockholder will be continued to be maintained in good standing without cost or
expense to Stockholder.
31
12.2 PATIENT FILES. Included within the Assets owned by the Company are
patient files and records (the "Patient Records"), the custody of which will
remain with the Company until the later to occr of the payment in full of the
Note and the termination or expiration of the Employment Agreement. In the event
that an "Event of Default" occurs as defined in the Pledge and Security
Agreement, then the custody of the Patient Records shall be immediately
transferred to Stockholder or such other person or entity as requested by
Stockholder without any payment by Stockholder to Buyer.
32
IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be duly executed as of the Execution Date.
BUYER:
QPQ CORPORATION,
a Florida Corporation
By: /s/ Xxxxxxxx Xxxxxxxx
-----------------------------------
Xxxxxxxx Xxxxxxxx, Chairman/CEO
COMPANY:
XXXX X. XXXXXXX, M.D., P.A.
a Florida professional association
By: /s/ Xxxx X. Xxxxxxx
-----------------------------------
Xxxx X. Xxxxxxx, M.D., President
STOCKHOLDERS:
/s/ Xxxx X. Xxxxxxx
--------------------------------------
Xxxx X. Xxxxxxx, M.D.
33
LIST OF EXHIBITS AND SCHEDULES
Exhibit A: List of Stockholders, Holdings and Consideration to be Paid
A-1 Promissory Note
B: Copies of all Licenses and all Credentialing Documents and Correspondence
Relating to the Company and the Company's Health Care Providers
C: Opinion of Counsel for the Company and the Stockholders
D: Employment Agreement
E: Pledge and Security Agreement
F: Releases
G: Opinion of Counsel for Buyer
Schedule 2.3(a) Voting Agreements, etc.
2.4(iii) Breach of Loans or Credit Agreements
2.5(a) Leased Real Property
2.5(a) (ii) Consents
2.5(a) (iii) Condition of Leased Real Property
2.5(a) (iv) Compliance with the Law
2.5(b) Personal Property
2.6 Financial Statements
2.7(b) Tax Disclosures
2.7(d) Tax Audits
2.7(e) Tax Matter Affiliations
2.8 Affiliated Accounts Receivable
34
2.9 Material Changes
2.11 Banking Arrangements
2.12(a) Exceptions to Intellectual Property Ownership
2.12(b) Intellectual Property
2.12(c) All Licenses of Company for Intellectual Property
2.12(d) All Licenses of Company Granted to Others for Intellectual Property
2.12(f) Confidentiality Agreements
2.13 Contracts, etc.
2.14 Litigation
2.15 Medical Malpractice Litigation
2.16 Insurance
2.17 Equity Investments
2.20 Licenses, Permits
2.22 Transactions with Interested Persons
2.23 Employee Benefit Programs
2.24 Environmental Matters
2.25 Officers and Directors
2.28 Employee Termination Payments
2.29 Material Third Party Payers and Providers
2.33 Health Care Facilities
3.3 Finder's Fees
35
