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EXHIBIT 10.6
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT (the "Agreement") is entered
into this ___ day of ___________, 1997, by and between AMERICAN PHYSICIAN
PARTNERS, INC., a Delaware corporation ("APP"), and the individuals identified
on Exhibit A attached hereto (the "Stockholders"). Unless otherwise defined
herein, all capitalized terms shall have the meaning contained in that certain
Agreement and Plan of Reorganization and Merger dated ______________, 1997 (the
"Merger Agreement") by and among APP, APP Sub and _________________________, a
_____________ corporation (the "Company").
RECITALS
A. Concurrent with this Agreement, the Company shall
enter into the Merger Agreement and the Service Agreement whereby APP shall
acquire the assets, and manage the non-medical aspects of, the Company's
radiology practice.
B. Pursuant to Section ____ of the Merger Agreement, the
Stockholders have, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, agreed to execute and deliver
this Agreement to APP and APP Sub.
NOW, THEREFORE, in consideration of the preceding recitals and
the covenants and agreements set forth herein, the parties agree as follows:
1. Indemnification by the Stockholders. Subject to the terms,
limitations and conditions of this Agreement, the Stockholders (each an
"Indemnifying Party" and collectively, the "Indemnifying Parties"), severally,
and not jointly, agree to indemnify, defend and hold APP and its directors,
officers, stockholders, employees, agents, attorneys, consultants and
Affiliates (each an "Indemnified Party" and collectively, the "Indemnified
Parties"), harmless from and against all losses, claims, obligations, demands,
assessments, penalties, liabilities, costs, damages, reasonable attorneys' fees
and expenses (including, without limitation, all costs of experts and all costs
incidental to or in connection with any appellate process) (collectively,
"Damages") asserted against or incurred by an Indemnified Party arising out of
or resulting from:
a. a breach of any representation, warranty or covenant
of the Company contained in the Merger Agreement (without giving effect to any
Material Adverse Effect qualifier contained as part of any such representation
or warranty or covenant of the Company contained in the Merger Agreement or in
any Disclosure Schedule or certificate delivered thereunder);
b. any violation (or alleged violation) by the Company
and/or any of its past or present directors, officers, partners, stockholders,
employees (including, without limitation, any Physician Employee), agents,
attorneys, consultants and Affiliates of any state or federal law governing
health care fraud and abuse or prohibition on referral of patients to Persons
in which a licensed professional has a financial or other form of interest
(including, but not limited to, fraud and abuse in the Medicare and Medicaid
Programs) occurring on or before the Closing Date, or any overpayment or
obligation (or alleged overpayment or obligation) arising out of or resulting
from claims submitted to any Payor on or before the Closing Date; and
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c. any liability under the Securities Act, the Exchange
Act or any other federal or state "blue sky" or securities law or regulation,
at common law or otherwise, arising out of or based upon any (i) untrue
statement of a material fact in any Registration Statement or any prospectus
forming a part thereof, or any amendment thereof or supplement thereto relating
to the Company (including any Company Subsidiary) or NewCo or (ii) failure to
state information necessary to make the statements required to be stated
therein not misleading, which untrue statement or failure to state information
arises or results solely from information provided in writing to APP or its
counsel by the Company or such Stockholder or their agents specifically for
inclusion in any such Registration Statement or any prospectus forming a part
thereof, or any amendment thereof or supplement thereto (including, without
limitation, schedules, exhibits and certifications delivered by the Company or
any of its agents in connection with the Merger Agreement).
The provisions contained in Paragraph 2(g) shall not apply to
indemnification of claims listed in Exhibit B attached hereto. In addition,
notwithstanding anything herein to the contrary, nothing contained in this
Agreement shall relieve any of the Stockholders of any liability or limit any
liability that he or she may have in the case of fraud in connection with the
transactions contemplated by the Merger Agreement.
2. Conditions of Indemnification. All claims for indemnification
under this Agreement shall be asserted and resolved as follows:
a. The Indemnified Party shall promptly (and, in any
event, at least ten (10) days prior to the due date for any responsive
pleadings, filings or other documents) (i) notify each Indemnifying Party of
any third-party claim or claims asserted against the Indemnified Party ("Third
Party Claim") that could give rise to a right of indemnification under this
Agreement and (ii) transmit to the Indemnifying Parties a written notice
("Claim Notice") describing in reasonable detail the nature of the Third Party
Claim, a copy of all papers served with respect to such claim (if any), an
estimate of the amount of Damages attributable to the Third Party Claim and the
basis of the Indemnified Party's request for indemnification under this
Agreement. The failure to promptly deliver a Claim Notice shall not relieve
any Indemnifying Party of its obligations to any Indemnified Party with respect
to the related Third Party Claim except to the extent that the resulting delay
is materially prejudicial to the defense of such claim. Within thirty (30)
days after receipt of any Claim Notice (the "Election Period"), the
Indemnifying Parties shall notify the Indemnified Party (x) whether the
Indemnifying Parties dispute their potential liability to the Indemnified Party
under this Agreement with respect to such Third Party Claim and (y) whether the
Indemnifying Parties desire, at the sole cost and expense of each Indemnifying
Party, to defend the Indemnified Party against such Third Party Claim.
b. If the Indemnifying Parties notify the Indemnified
Party within the Election Period that the Indemnifying Parties elect to assume
the defense of the Third Party Claim, then the Indemnifying Parties shall have
the right to defend, at their sole cost and expense, with counsel reasonably
acceptable to such Indemnified Party or Indemnified Parties, such Third Party
Claim by all appropriate proceedings, which proceedings shall be prosecuted
diligently by the Indemnifying Parties to a final conclusion or settled at the
discretion of the Indemnifying Parties in accordance with this Paragraph 2(b).
Except as set forth in Paragraph 2(f) below, the Indemnifying Parties shall
have full control of such defense and proceedings, including any compromise or
settlement thereof. The Indemnified Party is hereby authorized, at the sole
cost and expense of the Indemnifying Parties (but only if the Indemnified Party
is entitled to indemnification hereunder), to file, during the Election Period,
any motion, answer or other pleadings that the Indemnified Party shall deem
necessary or appropriate to protect its interests or those of the Indemnifying
Parties and not prejudicial to the Indemnifying Parties. If requested by the
Indemnifying
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Parties, the Indemnified Party agrees, at the sole cost and expense of the
Indemnifying Parties, to cooperate with the Indemnifying Parties and their
counsel in contesting any Third Party Claim that the Indemnifying Parties elect
to contest, including, without limitation, the making of any related
counterclaim against the person asserting the Third Party Claim or any
cross-complaint against any person. The Indemnified Party may participate in,
but not control, any defense or settlement of any Third Party Claim controlled
by the Indemnifying Parties pursuant to this Paragraph 2(b) and shall bear its
own costs and expenses with respect to such participation; provided, however,
that if the named parties to any such action (including any impleaded parties)
include both the Indemnifying Parties and the Indemnified Party, and the
Indemnified Party has been advised by counsel that there may be one or more
legal defenses available to it that are different from or additional to those
available to the Indemnifying Parties, then the Indemnified Party may employ
separate counsel at the expense of the Indemnifying Parties, and upon written
notification thereof, the Indemnifying Parties shall not have the right to
assume the defense of such action on behalf of the Indemnified Party; provided
further that the Indemnifying Parties shall not, in connection with any one
such action or separate but substantially similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for the reasonable fees and expenses of more than one separate firm
of attorneys at any time for the Indemnified Party, which firm shall be
designated in writing by the Indemnified Party. Notwithstanding the foregoing,
the Indemnifying Parties shall be prohibited from confessing or settling any
criminal allegations brought against the Indemnified Party without the express
written consent of the Indemnified Party.
c. If the Indemnifying Parties fail to notify the
Indemnified Party within the Election Period that the Indemnifying Parties
elect to defend the Indemnified Party pursuant to Paragraph 2(b), or if the
Indemnifying Parties elect to defend the Indemnified Party pursuant to
Paragraph 2(b) but fail diligently and promptly to prosecute or settle the
Third Party Claim, then the Indemnified Party shall have the right to defend,
at the sole cost and expense of the Indemnifying Parties (if the Indemnified
Party is entitled to indemnification hereunder), the Third Party Claim by all
appropriate proceedings, which proceedings shall be promptly and vigorously
prosecuted by the Indemnified Parties to a final conclusion or settled. The
Indemnified Parties shall have full control of such defense and proceedings,
provided, however, that the Indemnified Parties may not enter into, without the
Indemnifying Parties' consent, which shall not be unreasonably withheld, any
compromise or settlement of such Third Party Claim. Notwithstanding the
foregoing, if the Indemnifying Parties have delivered a written notice to the
Indemnified Party to the effect that the Indemnifying Parties dispute their
potential liability to the Indemnified Party under this Agreement and if such
dispute is resolved in favor of the Indemnifying Parties, the Indemnifying
Parties shall not be required to bear the costs and expenses of the Indemnified
Parties' defense pursuant to this Paragraph or of the Indemnifying Party's
participation therein at the Indemnified Party's request, and the Indemnified
Party shall reimburse the Indemnifying Parties in full for all costs and
expenses of such litigation. The Indemnifying Parties may participate in, but
not control, any defense or settlement controlled by the Indemnified Party
pursuant to this Paragraph 2(c), and the Indemnifying Parties shall bear their
own costs and expenses with respect to such participation; provided, however,
that if the named parties to any such action (including any impleaded parties)
include both the Indemnifying Party and the Indemnified Party, and the
Indemnifying Parties have been advised by counsel that there may be one or more
legal defenses available to it that are different from or additional to those
available to the Indemnified Party, then the Indemnifying Parties may employ
separate counsel and upon written notification thereof, the Indemnified Party
shall not have the right to assume the defense of such action on behalf of the
Indemnifying Parties.
d. In the event any Indemnified Party should have a
claim against any Indemnifying Parties hereunder that does not involve a Third
Party Claim, the Indemnified Party shall transmit to the Indemnifying Parties a
written notice (the "Indemnity Notice") describing in reasonable detail the
nature
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of the claim, an estimate of the amount of damages attributable to such claim
and the basis of the Indemnified Party's request for indemnification under this
Agreement. If the Indemnifying Parties do not notify the Indemnified Party
within sixty (60) days from its receipt of the Indemnity Notice that the
Indemnifying Parties dispute such claim, the claim specified by the Indemnified
Party in the Indemnity Notice shall be deemed a liability of the Indemnifying
Parties hereunder. If the Indemnifying Parties have timely disputed such
claim, as provided above, such dispute shall be resolved by the procedures set
forth in Paragraph 7.
e. Payments of all amounts owing by any Indemnifying
Party pursuant to this Agreement relating to a Third Party Claim shall be made
within thirty (30) days after the latest of (i) the settlement of such Third
Party Claim, (ii) the expiration of the period for appeal of a final
adjudication of such Third Party Claim, or (iii) the expiration of the period
for appeal of a final adjudication of the Indemnifying Parties liability to the
Indemnified Party under this Agreement. Payments of all amounts owing by the
Indemnifying Parties pursuant to Paragraph 2(d) shall be made within thirty
(30) days after the later of (i) the expiration of the 60-day Indemnity Notice
period or (ii) the expiration of the period for appeal of a final adjudication
of the Indemnifying Parties liability to the Indemnified Party under this
Agreement.
(1) Within five (5) business days following
distribution by APP of a Claim Notice or Indemnity Notice, as the case may be,
each Stockholder shall elect the percentage of APP Common Stock he or she
desires to allocate (the "Stock Percentage Election") to satisfy any obligation
to APP contained in the Claim Notice or Indemnity Notice (the "Indemnification
Obligation") and shall submit such Stock Percentage Election in writing to APP
at the address listed in Paragraph 8 hereof or any other address requested by
APP. Each Stockholder shall be entitled to make a Stock Percentage Election
equal to the percentage of APP Common Stock currently subject to such Lock-Up
Provisions (as that term is defined below). By way of example, if the
percentage of APP Common Stock subject to the Lock-Up Provisions is
seventy-five percent (75%) at the time of a Claim Notice or Indemnity Notice,
each Stockholder's Stock Percentage Election may equal, but not exceed,
seventy-five percent (75%) of the amount of the Indemnification Obligation
regardless of the Stock Percentage Elections submitted by the other
Stockholders. Failure to submit a complete Stock Percentage Election within
the time periods set forth in this Paragraph 2(e) shall be deemed to be an
election for such Stockholder to satisfy such Indemnification Obligation with
100% cash.
Each Stockholder's Stock Percentage Election shall be an
irrevocable election as to such Stockholder of the method of payment of the
applicable Indemnification Obligation, and such percentage election between APP
Common Stock and cash shall remain constant with respect to the final payment
of the Indemnification Obligation. Following each Stockholder's Stock
Percentage Election, each Stockholder shall, in APP's sole discretion, either
(i) transfer the Reserved APP Stock (as that term is defined below) to an
escrow account (the "Escrow Account") established by APP or (ii) consent to a
stop transfer of such APP Common Stock by APP to be either (x) held in the
Escrow Account or (y) subject to such stop order, as the case may be, until
final payment of the Indemnification Obligation as set forth in Paragraph
2(e)(4).
The remaining portion of the Indemnification Obligation not
satisfied by the Stock Percentage Election shall be valued in cash, however,
the cash portion shall not be transferred to the Escrow Account. By way of
example, if the Stock Percentage Election is 75%, the remaining 25% of the
Indemnification Obligation shall be paid in cash.
(2) For purposes of this Agreement only and in
order to calculate the actual number of shares of Reserved APP Stock to be held
in the Escrow Account or subject the a stop order, the
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value of each share of APP Common Stock transferred to the Escrow Account or be
subject to a stop transfer pursuant to the Stock Percentage Election shall be
calculated by averaging the daily closing prices for a share of APP Common
Stock for the twenty (20) consecutive trading days on which such shares are
actually traded on the Nasdaq National Market (or other national securities
exchange or inter-dealer quotation system) preceding the date of the Claim
Notice or Indemnity Notice, as the case may be (the "APP Stock Price").
(3) The number of shares to be reserved by the
transfer to the Escrow Account or subject to a stop transfer to satisfy the
Indemnification Obligation (the "Reserved APP Stock") shall be calculated by
APP according to the following formula:
(i) Determine the dollar amount of each
Stockholder's proportionate amount of the Indemnification Obligation
("Proportionate Obligation");
(ii) Multiply the Proportionate
Obligation by the Stock Percentage Election to determine the dollar value of
the Stock Percentage Election ("Stock Election Value"); and
(iii) Divide the Stock Election Value by
the APP Stock Price to determine the Reserved APP Stock.
Except as set forth herein, the Reserved APP Stock shall remain constant until
the final payment of any Indemnification Obligation. To determine the amount
of cash required to satisfy the Proportionate Obligation, subtract the Stock
Election Value from the Proportionate Obligation.
(4) On the final payment date pursuant to this
Paragraph 2(e) (the "Actual Payment Date"), the parties hereto will be notified
of the actual dollar amount of the Indemnification Obligation. On the Actual
Payment Date, if the amount owing by each Stockholder (1) equals the
Proportionate Obligation, then all of the Reserved APP Stock and the cash
portion of the Proportionate Obligation shall be transferred to APP, (2) is
less than the Proportionate Obligation, then the percentage of the Reserved APP
Stock and cash that is required to satisfy the actual Indemnification
Obligation shall be determined by multiplying (a) the total amount of the
actual Indemnification Obligation applicable to each Stockholder divided by the
Proportionate Obligation by the (b) number of shares of Reserved APP Stock for
such Stockholder and (c) the amount of cash that would have been required to
satisfy his or her Proportionate Obligation, or (3) is greater than the amount
of the Proportionate Obligation, then (a) all of the Reserved APP Stock and
cash that would have been required to satisfy his or her Proportionate
Obligation, plus (b) the amount by which the actual Indemnification Obligation
for such Stockholder exceeds the Proportionate Obligation, which additional
amount shall be payable by such Stockholder in cash, shall be transferred to
APP. By way of example, assume that (i) the amount of the Proportionate
Obligation as of the date of the Claim Notice or Indemnity Notice was equal to
$100,000, (ii) such Stockholder's Stock Election Percentage was 75%, and (iii)
the APP Stock Price was $15.00. The number of shares required to be placed
into the Escrow Account or subject to a stop transfer by such Stockholder would
be 5,000 shares of APP Common Stock ($100,000 X 75%/$15.00). If the actual
Indemnification Obligation was (1) $100,000, then all of the Reserved APP
Stock, regardless of the then-current trading price of the APP Common Stock,
plus $25,000 cash would be required to be transferred to APP, (2) $50,000,
which is 50% of the Proportionate Obligation, then 50% of the Reserved APP
Stock held in the Escrow Account or subject to a stop transfer (5,000 shares X
50%), or 2,500 shares, regardless of the then-current trading price of APP
Common Stock, plus $12,500 cash would be required to be transferred to APP, or
(3) $150,000, then all of the Reserved APP Stock held in the Escrow Account or
subject to a stop transfer, regardless of the then-current trading price of APP
Common Stock, $25,000 cash, plus an
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additional $50,000 cash (the difference between the actual Indemnification
Obligation and the Proportionate Obligation) would be required to be
transferred to APP.
All payments of cash in satisfaction of the actual Indemnification Obligation
pursuant to this Indemnification Agreement shall be made to APP by cashier's
check.
(5) Notwithstanding any provision contained
herein to the contrary, (1) each Stockholder shall be entitled to transfer to
APP shares of APP Common Stock held by such Stockholder which are subject to
the Lock-Up Provisions contained in Paragraph 1 of the Stockholder
Representation Letter ("Lock-Up Provisions") and (2) the provisions of
Paragraphs 2(e)(1) through (5) shall have no further force or effect, and shall
not apply in any manner whatsoever, with respect to any Claim Notice or
Indemnity Notice which is given subsequent to the earlier of (x) the
termination of the Lock-Up Provisions or (y) the end of the two (2) year period
following the Effective Date.
f. The Indemnifying Parties shall provide the
Indemnified Party with written notice of any firm offer that is made to settle
or compromise a Third Party Claim against an Indemnified Party. If a firm
offer is made to settle such a claim solely by the payment of money damages and
the Indemnifying Parties notify the Indemnified Party in writing that the
Indemnifying Parties agree to such settlement, but the Indemnified Party elects
not to accept and agree to it, the Indemnified Party may continue to contest or
defend such Third Party Claim and, in such event, the total maximum liability
of the Indemnifying Parties to indemnify or otherwise reimburse the Indemnified
Party hereunder with respect to such a claim shall be limited to and shall not
exceed the amount of such settlement offer, plus reasonable out-of-pocket costs
and reasonable expenses (including reasonable attorneys' fees and
disbursements) to the date of notice that the Indemnifying Parties desired to
accept such settlement.
g. Notwithstanding anything contained in this Agreement
or the Merger Agreement to the contrary, the Indemnifying Parties in the
aggregate (i) shall have no obligation hereunder to provide indemnification for
the first $100,000 of Damages (without counting Immaterial Claims as defined
below), and (ii) in no event shall the Indemnifying Parties have any liability
hereunder with respect to any singular incident or a fact involving a breach or
inaccuracy of the Company if the Damages from such claim are equal to or less
than $7,500 ("Immaterial Claims"). Notwithstanding anything to the contrary
contained herein or in the Merger Agreement, the obligations of each
Stockholder hereunder shall not exceed fifty percent (50%) of the aggregate
value of the Merger Consideration or Exchange Consideration, as the case may
be, paid to such Stockholder pursuant to any Related Acquisition on the Closing
Date.
3. Intentionally Omitted.
4. Remedies Exclusive. The remedies provided in this Agreement
are the exclusive rights or remedies available to one party against the other
arising out of or with respect to the Merger Agreement, either at law or in
equity, except in the case of fraud.
5. Costs, Expenses and Legal Fees. Whether or not the
transactions contemplated hereby are consummated, each party hereto shall bear
its own costs and expenses (including attorneys' fees), except that each party
hereto agrees to pay the costs and expenses (including reasonable attorneys'
fees and expenses) incurred by the other parties in successfully (a) enforcing
any of the terms of this Agreement or (b) proving that another party breached
any of the terms of this Agreement.
6. Tax Benefits; Insurance Proceeds. The total amount of any
indemnity payments owed by one party to another party to this Agreement shall
be reduced by any correlative tax benefit received by
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the party to be indemnified or the net proceeds received by the party to be
indemnified with respect to recovery from third parties or insurance proceeds,
and such correlative insurance benefit shall be net of the insurance premium,
if any, that becomes due as a result of such claim.
7. Dispute Resolution.
a. Arbitration. The parties hereto agree that any
claim, controversy, dispute or disagreement between or among any of the parties
arising out of or relating to this Agreement shall be governed exclusively by
the terms and provisions of this Paragraph 7; provided, however, that within
ten (10) days from the date any party gives notice to the others of its desire
to seek arbitration as provided in Paragraph 7(b) and prior to commencing an
arbitration procedure pursuant to this Paragraph 7, the parties shall meet to
discuss and consider alternative dispute resolution procedures other than
arbitration including, but not limited to Judicial Arbitration & Mediation
Services, Inc., if applicable. If at any time prior to the rendering of the
decision by the arbitrator (or pursuant to such other alternative dispute
resolution procedure) as contemplated in this Paragraph 7 to the extent a party
makes a written offer to an opposing party proposing a settlement of the
matter(s) at issue and such offer is rejected, then the party rejecting such
offer shall be obligated to pay the costs and expenses (excluding the amount of
the award granted under the decision) of the party that offered the settlement
from the date such offer was received by such other party if the decision is
for a dollar amount that is less than the amount of such offer to settle.
Notwithstanding the foregoing, the terms and provisions of this Paragraph 7
shall not preclude any party hereto from seeking, or a court of competent
jurisdiction from granting, a temporary restraining order, temporary injunction
or other equitable relief for any breach of (i) any noncompetition or
confidentiality covenant or (ii) any duty, obligation, covenant, representation
or warranty, the breach of which may cause irreparable harm or damage.
b. Arbitrators. In the event there is a claim,
controversy, dispute or disagreement among the parties hereto arising out of or
relating to this Agreement (including any claim based on or arising from an
alleged tort) and the parties hereto have not reached agreement regarding an
alternative to arbitration, the parties agree to select, within 30 days of
notice by a party to the other of its desire to seek arbitration under this
Paragraph 7 one (1) arbitrator mutually acceptable to the Company and the
Stockholders to hear and decide all such claims under this Paragraph 7. Each
of the arbitrators proposed shall be impartial and independent of all parties.
If the parties cannot agree on the selection of an arbitrator within said
30-day period, then any party may in writing request the judge of the United
States District Court for the _____________ District of __________ senior in
term of service to appoint the arbitrator and, subject to this Paragraph 7,
such arbitrator shall hear all arbitration matters arising under this Paragraph
7.
c. Applicable Rules.
(1) Each arbitration hearing shall be held at a
place in _____________ acceptable to the arbitrator. The arbitration shall be
conducted in accordance with the Commercial Arbitration Rules of the American
Arbitration Association to the extent such rules do not conflict with the terms
hereof; provided, however, that if the parties hereto agree to an alternative
to arbitration they may agree to an alternative set of rules, including as to
rules of evidence and procedure. The decision of the arbitrator shall be
reduced to writing and shall be binding on the parties and such decision shall
contain a concise statement of the reasons in support of such decision.
Judgment upon the award(s) rendered by the arbitrator may be entered and
execution had in any court of competent jurisdiction or application may be made
to such court for a judicial acceptance of the award and an order of
enforcement. The charges and expenses of the arbitrator shall be shared
equally by the parties to the hearing.
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(2) The arbitration shall commence within ten
(10) days after the arbitrator is selected in accordance with the provisions of
this Paragraph 7. In fulfilling his duties with respect to determining the
amount of any loss, the arbitrator may consider such matters as, in the opinion
of the arbitrator, are necessary or helpful to make a proper valuation. The
arbitrator may consult with and engage disinterested third parties to advise
the arbitrator. The arbitrator shall not add any interest factor reflecting
the time value of money to the amount of any loss and shall not award any
punitive damages.
(3) If the arbitrator selected hereunder should
die, resign or be unable to perform his or her duties hereunder, the parties,
or such senior judge (or such judge's successor) in the event the parties
cannot agree, shall select a replacement arbitrator. The procedure set forth
in this Paragraph 7 for selecting the arbitrator shall be followed from time to
time as necessary.
(4) As to any determination of the amount of any
loss, or as to the resolution of any other claim, controversy, dispute or
disagreement, that under the terms hereof is made subject to arbitration, no
lawsuit based on such claimed loss or such resolution shall be instituted by
the parties hereto, other than to compel arbitration proceedings or enforce the
award of the arbitrator, except as otherwise provided in Paragraph 7.
(5) All privileges under [state] and federal law,
including attorney-client and work-product privileges, shall be preserved and
protected to the same extent that such privileges would be protected in a
federal court proceeding applying [state] law.
8. Miscellaneous.
a. Amendment; Waivers. This Agreement may be amended,
modified or supplemented only by an instrument in writing executed by all the
parties hereto. Any waiver of any terms and conditions hereof must be in
writing, and signed by the party or parties making any such waiver. The waiver
of any of the terms and conditions of this Agreement shall not be construed as
a waiver of any other terms and conditions hereof.
b. Assignment. Neither this Agreement nor any right
created hereby or in any agreement entered into in connection with the
transactions contemplated hereby shall be assignable by any party hereto.
c. Parties in Interest. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective heirs, legal representatives, successors
and assigns of the parties hereto.
d. Entire Agreement. This Agreement, the Merger
Agreement and any agreements contemplated hereby constitute the entire
agreement of the parties regarding the subject matter hereof, and supersede all
prior agreements and understandings, both written and oral, among the parties,
or any of them, with respect to the subject matter hereof.
e. Severability. If any provision of this Agreement is
held to be illegal, invalid or unenforceable under present or future laws
effective during the term hereof, such provision shall be fully severable and
this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision never comprised a part hereof; and the remaining
provisions hereof shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its severance
therefrom. Furthermore, in lieu of such illegal, invalid or unenforceable
provision, there shall be added
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automatically as part of this Agreement a provision as similar in its terms to
such illegal, invalid or unenforceable provision as may be possible and be
legal, valid and enforceable.
f. Governing Law. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS (BUT NOT THE RULES GOVERNING
CONFLICTS OF LAWS) OF THE STATE OF ______________.
g. Captions. The captions contained in this Agreement
are for convenience of reference only and shall not limit or otherwise affect
any of the terms or provisions hereof.
h. Gender and Number. When the context requires, the
gender of all words used herein shall include the masculine, feminine and
neuter and the number of all words shall include the singular and plural.
i. Reference to Agreement. Use of the words "herein,"
"hereof," "hereto" and the like in this Agreement shall be construed as
references to this Agreement as a whole and not to any particular Article,
Paragraph or provision of this Agreement, unless otherwise noted.
j. Notice. Whenever this Agreement requires or permits
any notice, request, or demand from one party to another, the notice, request
or demand must be in writing to be effective and shall be deemed to be
delivered and received (i) if personally delivered or if delivered by telex,
telegram, facsimile or courier service, when actually received by the party to
whom notice is sent or (ii) if delivered by mail (whether actually received or
not), at the close of business on the third business day next following the day
when placed in the mail, postage prepaid, certified or registered, addressed to
the appropriate party or parties, at the address of such party set forth below
(or at such other address as such party may designate by written notice to all
other parties in accordance herewith):
If to APP: American Physician Partners, Inc.
000 Xxxx Xxxxxx
0000 XxxxxxxXxxx Xxxxx
Xxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxx, President
with a copy to: Xxxxxxx, Phleger & Xxxxxxxx LLP
0000 XxxXxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Fax No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxx
If to the Stockholders: See Exhibit A
k. Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original, and all of
which together shall constitute one and the same instrument.
l. Survival. Any and all claims for indemnification
asserted in writing before the expiration of the applicable survival periods
specified in Section __ of the Merger Agreement shall survive until resolved.
9
10
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first written above.
APP:
AMERICAN PHYSICIAN PARTNERS, INC.
By:_____________________________
Xxxxxxx X. Xxxxxxx, President
STOCKHOLDERS:
[Separate pages to be attached]
10
11
Exhibit A
List of Stockholders
A-1
12
Exhibit B
List of Exceptions
APP and the Company shall mutually agree upon certain exceptions to
Paragraph 2(g) including, without limitation, pending litigation and claims and
existing violations of law.
B-1
