September 10, 2008
Exhibit
10.2
September 10,
2008
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxx Xxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx,
Chairman
and Chief Executive Officer
Ladies and
Gentlemen:
Reference is made to that certain Stock Purchase Agreement,
dated as of the date hereof, by and among MBF Healthcare
Acquisition Corp., a Delaware corporation (the
“Buyer”), Critical Homecare Solutions Holdings,
Inc., a Delaware corporation (the “Company”),
Kohlberg Investors V, L.P., a Delaware limited partnership,
in its capacity as the Sellers’ Representative and as a
stockholder of the Company, and the other stockholders of the
Company set forth on the signature pages thereto (as amended and
modified from time to time, the “Stock Purchase
Agreement”), pursuant to which the Buyer has agreed to
purchase from the stockholders all of the issued and outstanding
shares of common stock, par value $.001, of the Company, on the
terms and subject to the conditions set forth in the Stock
Purchase Agreement, as the same has and may be amended from time
to time. Capitalized terms used but not defined herein have the
meanings ascribed to them in the Stock Purchase Agreement.
For good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged the parties hereto agree as
follows:
This letter agreement and the Subscription Agreement attached
hereto as Exhibit A (the “Investor
Subscription Agreement”) amend and restate in its
entirety that certain Letter Agreement by and between the Buyer
and MBF Healthcare Partners, L.P., a Delaware limited
partnership (the “Equity Investor”), dated
February 6, 2008.
On the Closing Date, the Equity Investor shall transfer and
deliver to the Buyer 2,343,750 shares of Buyer’s Stock
for cancellation without any consideration, subject to the
paragraph below.
After the conclusion of each of the five consecutive
twelve-month periods commencing January 1, 2009 and within
thirty (30) days of the Buyer’s filing of its annual
report on
Form 10-K
thereafter with the SEC, the Buyer shall grant, issue and
deliver to the Equity Investor the number of shares of
Buyer’s Stock, if any, equal to the quotient of:
(i) thirty-three and one third percent (33
1/3%)
of the Buyer’s EBITDA (as hereinafter defined) in excess of
$52,500,000 divided by (ii) the Per Share Price (as
hereinafter defined); provided that the maximum dollar amount of
shares of Buyer Stock to be issued hereunder (as determined by
the applicable Per Share Price) shall in no event exceed
$1,150,000 in the aggregate (the “Share Amount”). For
purposes hereof, (i) “Per Share Price” shall mean
the average closing sales price of Buyer’s Stock for the
ten consecutive trading days prior to the date of delivery of
the Buyer’s Stock hereunder; provided in no event
shall the Per Share Price be less than the Per Share Earn-Out
Price (as defined in the Stock Purchase Agreement) for the
applicable fiscal year period and
(ii) “EBITDA” shall mean the consolidated
earnings before interest, taxes, depreciation and amortization
as defined in the Buyer’s senior credit facility existing
as of the Closing Date (as amended, modified and replaced from
time to time), as adjusted to reflect EBITDA of any acquisitions
made during the applicable period as if such acquisition had
been effective on the first day of the fiscal year in which such
acquisition is consummated.
The Equity Investor hereby represents and warrants that it has
sufficient cash on hand or capital commitments to satisfy its
obligations under this letter agreement and the Investor
Subscription Agreement, and will take no action that would
prevent it from satisfying such obligations. The Sellers are
intended third party beneficiaries of the Buyer’s rights
under this letter agreement and the Investor Subscription
Agreement and shall have the right to enforce the Buyer’s
rights hereunder and thereunder, including the obligation of the
Equity Investor to fund the amount subscribed for under the
Subscription Agreement. In that connection, the
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obligations of the Equity Investor to the Sellers and the Buyer
shall be direct, primary and unconditional, except as expressly
set forth herein. Except as specifically provided above, no
Person, other than the Sellers and the Buyer, shall be entitled
to rely upon this letter agreement or the Investor Subscription
Agreement or bring any action under this letter agreement or the
Investor Subscription Agreement. The Buyer’s creditors
shall have no right to enforce this letter agreement or the
Investor Subscription Agreement or to cause Buyer to enforce
this letter agreement or the Investor Subscription Agreement.
The parties hereby agree that their respective representations,
warranties and covenants set forth herein are solely for the
benefit of the other party hereto and the Sellers, in accordance
with and subject to the terms of this letter agreement, and this
letter agreement and the Investor Subscription Agreement is not
intended to, and does not, confer upon any Person other than the
parties hereto and the Sellers any rights or remedies hereunder.
Notwithstanding anything to the contrary herein, if the Closing
does not occur, the Equity Investor shall be obligated to fund
an amount sufficient for the Buyer to be able to satisfy any
liability it may have to the Sellers under the Stock Purchase
Agreement pursuant to Section 10.2 thereof for losses
incurred by Sellers
and/or the
Company for the intentional or willful material breach of the
Stock Purchase Agreement by the Buyer; provided that, the
liability of the Equity Investor and the Buyer, in the
aggregate, shall under no circumstances exceed $4,000,000 for
losses incurred by the Sellers
and/or the
Company in connection with the transactions contemplated by the
Stock Purchase Agreement for the breach of this letter agreement
and/or the
Investor Subscription Agreement by the Equity Investor or an
intentional or willful breach of the Stock Purchase Agreement by
the Buyer. The Sellers acknowledge that their sole and exclusive
remedy regarding the Equity Investor’s obligation under
this letter agreement and the Investor Subscription Agreement if
the Closing does not occur shall be limited as set forth in the
prior sentence.
Notwithstanding anything that may be expressed or implied in
this letter agreement or the Investor Subscription, no Person
other than the undersigned shall have any obligation hereunder
and, notwithstanding that the undersigned may be a partnership
or limited liability company, no recourse hereunder shall be had
against any former, current or future director, officer,
employee, agent, general or limited partner, manager, member,
stockholder or affiliate of the undersigned or any former,
current or future director, officer, employee, agent, general or
limited partner, manager, member, stockholder or affiliate of
any of the foregoing, whether by the enforcement of any
assessment or by any legal or equitable proceeding, or by virtue
of any statute, regulation or other applicable law, it being
expressly agreed and acknowledged that no personal liability
shall attach to, be imposed on or otherwise be incurred by any
former, current or future director, officer, employee, agent,
general or limited partner, manager, member, stockholder or
affiliate or assignee of the undersigned or any former, current
or future director, officer, employee, agent, general or limited
partner, manager, member, stockholder or affiliate or assignee
of any of the foregoing, for any obligations of the undersigned
under this letter agreement or the Subscription Agreement.
This letter agreement shall be treated as confidential and is
being provided to the Buyer solely in connection with the Stock
Purchase Agreement. This letter agreement may not be used,
circulated, quoted or otherwise referred to in any document,
except with the prior written consent of the Equity Investor.
Notwithstanding the foregoing, this letter agreement may be
provided to the Company if the Company agrees to treat the
letter agreement as confidential, except that the Buyer and the
Company may disclose the existence and contents of this letter
agreement to the extent required by Law, the applicable rules of
any national securities exchange or in connection with any SEC
filings relating to the Stock Purchase, including the
Preliminary Proxy Statement and Definitive Proxy Statement and
may disclose the existence and content of this letter agreement
to its lenders and equity investors in connection with the
Private Placement.
This letter agreement shall expire on the earlier of the
(i) Closing and (ii) the termination of the Stock
Purchase Agreement in accordance with its terms;
provided, however, that notwithstanding any such
expiration under clause (ii) in connection with the
termination of the Stock Purchase Agreement, any claim for
breach of this letter, the Investor Subscription Agreement or an
intentional or willful material breach of the Stock Purchase
Agreement by the Buyer may be brought in a court of competent
jurisdiction on or before the 60th day following the
termination of the Stock Purchase Agreement, in which case this
letter agreement shall survive until the ultimate resolution of
such claim; provided that the paragraph providing for the
“Share Amount” herein shall survive the Closing in
accordance with its terms.
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The rights and obligations under this letter agreement may not
be assigned by any party without the prior written consent of
the parties to this letter agreement and the Seller’s
Representative.
This letter agreement shall be governed by, and construed and
interpreted in accordance with, the laws of the State of
Delaware, without giving effect to any applicable principles of
conflict of laws rules that would cause the laws of another
State to otherwise govern this letter agreement. The parties
hereby (i) submit to the personal jurisdiction of the
Delaware Court of Chancery, or in the event (but only in the
event) that such court does not have subject matter jurisdiction
over an action or proceeding, in the United States District
Court for the District of Delaware, and (ii) waive any
claim of improper venue or any claim that those courts are an
inconvenient forum.
[Signature
Page Follows]
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THE PARTIES HEREBY WAIVE TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH
RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.
Very truly yours,
MBF HEALTHCARE PARTNERS, L.P.
| By: | MBF Healthcare Advisors I, L.P., its General Partner |
| By: | MBF Healthcare Advisors LLC, its General Partner |
| By: |
/s/ Xxxxx X. Xxxx
|
Name: Xxxxx X. Xxxx
Title: Senior Vice President and
Chief Operating Officer
Chief Operating Officer
ACKNOWLEDGED AND AGREED:
/s/ Xxxxx X. Xxxx
Name: Xxxxx X. Xxxx
Title: Senior Vice President and
Chief Operating Officer
Chief Operating Officer
Date:
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EXHIBIT A
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