STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxxxx X. Xxxxxx and Xxxxx X.
Xxxxxx, individuals residing in Granite Bay, California, and shareholders of the
Company (individually and collectively referred to as "Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 16,487 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-10 and C-57 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $187,010.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxx X. and Xxxxx X. Xxxxxx
0000 Xxxxxxxx Xxx
Xxxxxxx Xxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxxx X. Xxxxxx
Printed Name: Xxxxxxx X. Xxxxxx
Signature: /s/ Xxxxx X. Xxxxxx
Printed Name: Xxxxx X. Xxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and BT Xxxx Xxxxx,
Inc., Custodian for the benefit of Xxxxxxx X. Xxxxxx, Rollover - XXX dated
February 10, 1997, a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties,
for the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 97,628 authorized and issued shares of the Company's $0.01 par
value common stock presently owned by Seller and evidenced by stock certificate
number C-58 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $1,614,863.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: BT Xxxx Xxxxx, Inc., Custodian for the benefit
of Xxxxxxx X. Xxxxxx, Xxxx - XXX
dated February 10, 1997
Seneca Capital Management
000 Xxxxxxxxxx Xxxxxx, #000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ BT Xxxx Xxxxx c/4
Xxxxxxx X. Xxxxxx XXX
X. Xxxxxxx Xxxxx, POA VP
Printed Name: E. Xxxxxxx Xxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and X.X. Xxxxxxxx and
X. Xxxxxxxx, Trustees under The Xxxxxxxx Trust dated Ausgust 30, 1995,
individuals residing in Roseville, California, and shareholders of the Company
("collectively and indivually referred to as "Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 13,987 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-8 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $158,652.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: X.X. Xxxxxxxx and X. Xxxxxxxx, Trustees
The Xxxxxxxx Trust dated August 30, 1995
0000 Xxxxx Xxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxx 00000-0000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature:/s/ X.X. Xxxxxxxx
Printed Name: X.X. Xxxxxxxx, Trustee under The
Xxxxxxxx Trust dated August 30, 1995
Company: Horizon Vision Center, Inc.
By:/s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxxxx Xxxxxxx,
Trustee under the Xxxxxxxx Xxxxxxx Trust, and shareholder of the Company
(collectively referred to as "Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 25,000 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-12 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $283,571.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxxx Xxxxxxx
Trustee, Xxxxxxxx Xxxxxxx Trust
00000 Xxxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxxxx Xxxxxxx
Printed Name: Xxxxxxxx Xxxxxxx
Trustee, Xxxxxxxx Xxxxxxx Trust
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx Xxxxxxx Xxxx, an individual
residing in Folsom, California, and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,763 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-73 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,997.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx Xxxxxxx Xxxx
000 Xxxxxxx Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
S-2
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx Xxxxxxx Xxxx
Printed Name: Xxxxx Xxxxxxx Xxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxxxxxx Xxxxx Xxxx, an
individual residing in Folsom, California, and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,763 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-74 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,997.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxxxx Xxxx Xxxx
000 Xxxxxxx Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxxxxx Xxxxx Xxxx
Printed Name: Xxxxxxxxx Xxxxx Xxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Panda Investments, LLC, a
shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 16,458 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-11 and C-54 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $186,681.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Panda Investments, LLC
X.X. Xxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000-0000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Panda Investments, LLC by OR
(per authorization of Trustees)
Printed Name: Panda Investments, LLC
Xxxx Xxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name:Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By:/s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxxx Nice, an individual
residing in Sacramento, California and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 15,000 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-7 and C-53 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $170,143.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxx Nice
0000 Xxx Xxxxx Xxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxx Nice
Printed Name: Xxxxxx Nice
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and X.X. Xxxx, Xx., an individual
residing in Zephyr Cove, Nevada and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 5,000 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-6 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $56,714.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: X.X. Xxxx, Xx.
000 Xxxxxxx 00, Xxxxxxxx Xxxx 000
Xxxxxx Xxxx, Xxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ X.X. Xxxx, Xx.
Printed Name: X.X. Xxxx, Xx.
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxxxxx and Xxxxxxx X.
Xxxxxxx, individuals residing in Sacramento, California, shareholders of the
Company (collectively and individually referred to as "Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 16,438 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-5 and C-52 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $186,454.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. or Xxxxxxx X. Xxxxxxx
0000 Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxxxxx
Printed Name: Xxxxx X. Xxxxxxxx
Signature: /s/ Xxxxxxx X. Xxxxxxxx
Printed Name: Xxxxxxx X. Xxxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxxxx X. Xxxxxxx, an individual
residing in Stockton, California and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 27,811 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-15 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $315,456 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxx X. Xxxxxxx, M.D.
0000 Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxxx X. Xxxxxxx, M.D.
Printed Name: Xxxxxxx X. Xxxxxxx, M.D.
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxx and Xxxxxxx X.
Xxxxxxx, individuals residing in Sacramento, California, shareholders of the
Company (collectively and individually referred to as "Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties,
for the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 14,030 authorized and issued shares of the Company's $0.01 par
value common stock presently owned by Seller and evidenced by stock certificate
number C-9 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $159,140.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxx and Xxxxxxx X. Xxxxxx
0000 Xxxx Xxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxx
Printed Name: Xxxxx X. Xxxxx
Signature: /s/ Xxxxxxx X. Xxxxxx
Printed Name: Xxxxxxx X. Xxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title:President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxx X. and Xxxx
X. Xxxxxx, Trustees under Trust Agreement dated April 12, 1989, and shareholders
of the Company (collectively and individually referred to as "Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties,
for the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 13,942 authorized and issued shares of the Company's $0.01 par
value common stock presently owned by Seller and evidenced by stock certificate
number C-20 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $158,142.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxx X. Xxxxxx and Xxxx X. Xxxxxx
Trustees under Trust Agreement dated
April 12, 1989
000 Xxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxx X. Xxxxxx
Printed Name: Xxxxxx X. Xxxxxx, Trustees under
Trust Agreement dated April 12, 1989
Signature: /s/ Xxxx X. Xxxxxx
Printed Name:Xxxx X. Xxxxxx, Trustees under
Trust Agreement dated April 12, 1989
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxx, an individual
residing in Winters, California, and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties,
for the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 14,000 authorized and issued shares of the Company's $0.01 par
value common stock presently owned by Seller and evidenced by stock certificate
number C-4 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $158,800.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxx
00000 Xxxxxxx Xxxx 00
Xxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
S-2
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxx
Printed Name: Xxxxx X. Xxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By:/s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxx X. Xxxxxxx, an individual
residing in Provo, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 14,352 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-14 and C-89 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $162,793.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxx X. Xxxxxxx
0000 Xxxx Xxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxx X. Xxxxxxx
Printed Name: Xxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxxxx, an individual
residing in Farmington, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-79 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxxxx
000 X. Xxxxx Xxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature:/s/ Xxxxx X. Xxxxxxx
Printed Name: Xxxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxx Xxxx Xxxxxxx, an individual
residing in Farmington, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-80 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxx Xxxx Xxxxxxx
000 X. Xxxxx Xxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxx Xxxx Xxxxxxx
Printed Name: Xxxx Xxxx Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxx X. Xxxxxxx,
an individual residing in Farmington, Utah and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-81 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxx X. Xxxxxxx
000 X. Xxxxx Xxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx Xxxxxxx
Printed Name: Xxxxx Xxxxxxx, Parent Guardian for
Xxxxxx X. Xxxxxxx, a Minor, Age 1 Year
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxx X. Xxxxx,
M.D., Inc., Profit Sharing Plan and Trust, a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 25,000 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-3 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $283,571.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: [INSERT SELLER'S ADDRESS]
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxx X. Xxxxx, M.D.
Printed Name: Xxxxxx X. Xxxxx, M.D., Trustee,
Xxxxxx X. Xxxxx, M.D., Inc., Profit Sharing
Plan and Trust
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxxx, an individual
residing in San Leandro, California and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 7,576 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-61 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $85,933.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxxx
00000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxxx
Printed Name: Xxxxx X. Xxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxx Xxxxxxxx
Xxxxxxx, an individual residing in Provo, Utah and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-99 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxx Xxxxxxxx Xxxxxxx
0000 Xxxxx Xxxxxxxx Xxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature:/s/Xxxx X. Xxxxxxx
Printed Name: Xxxx X. Xxxxxxx, Parent Guardian for
Xxxx Xxxxxxxx Xxxxxxx, A Minor, Age 1 week
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxxxxx Xxxxxxx,
an individual residing in Provo, Utah and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-78 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxxxx Xxxxxxx
0000 Xxxx 000 Xxxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxx X. Xxxxxxx
Printed Name: Xxxx X. Xxxxxxx, Parent Guardian for
Xxxxxxxxx Xxxxxxx, a Minor, Age 3 Years
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxx X. Xxxxxxx, an individual
residing in Provo, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-75 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxx X. Xxxxxxx
0000 Xxxxx Xxxxxxxx Xxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxx X. Xxxxxxx
Printed Name: Xxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxx X. Xxxxxxx, an individual
residing in Provo, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-76 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxx X. Xxxxxxx
0000 Xxxxx Xxxxxxxx Xxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxx X. Xxxxxxx
Printed Name: Xxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxxxx, an individual
residing in Provo, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-84 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxxxx
0000 Xxxx 000 Xxxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxxxx
Printed Name: Xxxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxxxx, an individual
residing in Provo, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-87 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxxxx
c/o Xxxx X. Xxxxxxx
0000 Xxxxx Xxxxxxxx Xxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxxxx
Printed Name: Xxxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxxxx, an individual
residing in Provo, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-87 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxxxx
c/o Xxxx X. Xxxxxxx
0000 Xxxxx Xxxxxxxx Xxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxxxx
Printed Name: Xxxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Jolie X. Xxxxxxx, an individual
residing in Coralville, Iowa and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-83 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Jolie X. Xxxxxxx
0000 Xxxxxxxx Xxxxxx, #0
Xxxxxxxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Jolie X. Xxxxxxx
Printed Name: Jolie X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxxx Xxxxxxx,
an individual residing in Provo, Utah and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties,
for the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par
value common stock presently owned by Seller and evidenced by stock certificate
number C-77 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $19,986.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxx Xxxxxxx
0000 Xxxx 000 Xxxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxx X. Xxxxxxx
Printed Name: Xxxx X. Xxxxxxx, Parent Guardian for
Xxxxxxx Xxxxxxx, a Minor, Age 5 Years
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxxxx X.
Xxxxxxx, an individual residing in Provo, Utah and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-86 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxxx Xxxxxxx
0000 X. 000 Xxxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxxxx
Printed Name: Xxxxx X. Xxxxxxx, Parent Guardian for
Xxxxxxxx X.Xxxxxxx, A Minor, Age 1 Year
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxxxx X. Xxxxxxx, an individual
residing in Provo, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 1,762 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-85 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $19,986.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxx X. Xxxxxxx
0000 Xxxx 000 Xxxxx
Xxxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxxx X. Xxxxxxx
Printed Name: Xxxxxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name:Xxxxxxx X. Xxxxxxx
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and the Xxxxxxx
Charitable Remainder Trust, a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 39,951 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-92 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $453,158.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: J. Xxxxxx Xxxxxxx, Trustee under the
Xxxxxxx Charitable Remainder
0000 Xxxx Xxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ J. Xxxxxx Xxxxxxx, Trustee
Printed Name: J. Xxxxxx Xxxxxxx, Trustee under the
Xxxxxxx Charitable Remainder Trust
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and J. Xxxxxx Xxxxxxx,
Trustee under the Xxxxxxx & Xxxx, a Medical Corporation, 401 (k) Profit Sharing
Plan, a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 65,819 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-2 and C-50 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $746,576.00 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: J. Xxxxxx Xxxxxxx, Trustee under the
Xxxxxxx & Xxxx, a Medical Corporation,
401(k) Profit Sharing Plan
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ J. Xxxxxx Xxxxxxx, Trustee
Printed Name: J. Xxxxxx Xxxxxxx, Trustee under the
Xxxxxxx & Xxxx, A Medical Corporation,
401(k) Profit Sharing Plan
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxxxx Xxx Xxxxxx, D.M.D., an
individual residing in Sacramento, California and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 25,000 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-1 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $283,571.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxx Xxx Xxxxxx, D.M.D.
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature:/s/ Xxxxxxx Xxx Xxxxxx, D.M.D.
Printed Name: Xxxxxxx Xxx Xxxxxx, D.M.D.
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxxx, an individual
residing in Mokelumne Hill, California and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 11,363 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-62 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $128,889.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxxx
00000 Xxxxx Xxx
Xxxxxxxxx Xxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxxx
Printed Name: Xxxxx X. Xxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxx, an individual
residing in Hayward, California and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 30,518 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-48 and C-68 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $346,161 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxx
00000 Xxxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
S-2
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxx
Printed Name: Xxxxx X. Xxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxx, M.D., an
individual residing in Hayward, California and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 30,517 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-49 and C-67 (collectively, including such shares of common stock, the "Capital
Stock"). The purchase price for the Capital Stock shall be $346,150 (the
"Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. Xxxxx XX, M.D.
0000 X Xxxxxx
Xxxxxxx, XX 00000-0000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxx X. Xxxxx, M.D.
Printed Name: Xxxxx X. Xxxxx, M.D.
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999(the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and Xxxxxxxx X. Xxxxxxx, an
individual residing in San Ramon, California and a shareholder of the Company
("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 8,983 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-21 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $101,893.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxxx X. Xxxxxxx
000 Xxxxxxxxx Xxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxxxxxxx X. Xxxxxxx
Printed Name: Xxxxxxxx X. Xxxxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among PrimeSight,
L.L.C., a Delaware limited liability company ("Prime"), Horizon Vision Center,
Inc., a Nevada corporation (the "Company") and The Corporation of the President
of the Church of Xxxxx Xxxxxx of Latter-Day Saints, a Utah Corporation Sole, in
Salt Lake City, Utah and a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, all
of Seller's shares of capital stock of the Company, including, without
limitation, 2,115 authorized and issued shares of the Company's $0.01 par value
common stock presently owned by Seller and evidenced by stock certificate number
C-88 (collectively, including such shares of common stock, the "Capital Stock").
The purchase price for the Capital Stock shall be $23,990.00 (the "Purchase
Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties
3.1 Representations by Seller. Seller hereby represents and warrants to
Prime that each of the following matters is true and correct in all respects as
of the Closing Date (with the understanding that Prime is relying materially on
each such representation and warranty in entering into and performing this
Agreement), which representations and warranties shall also be deemed made as of
the Effective Time and which shall survive the Closing:
(a) Due Authorization. Seller has full power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
(b) Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be duly authorized, validly issued and outstanding, fully paid,
non-assessable, and free of any liens, claims or encumbrances whatsoever.
(c) No Further Ownership. Immediately following the Closing
Date, Seller does not own (i) any shares of equity or other voting securities of
the Company, (ii) any securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) any
options or other rights to acquire from the Company, or any obligation of the
Company to issue or sell, equity or other voting securities of the Company, or
securities of the Company convertible into or exchangeable for such equity or
voting securities, and (iv) any equity equivalents, interests in the ownership
or earnings, rights to participate in the election of directors or other similar
rights of or with respect to the Company.
(d) Claims and Proceedings. No inquiry, action, or proceeding
has been asserted, instituted, or threatened against Seller to restrain or
prohibit the carrying out of the transactions contemplated by this Agreement or
to challenge the validity of such transactions or any part thereof or seeking
damages on account thereof.
3.2 Representations by the Company. The Company hereby represents and
warrants to Prime that each of the representations and warranties made by Seller
in Section 3.1 are true and correct in all respects as of both the Closing Date
and the Effective Time (with the understanding that Prime is relying materially
on the Company's representation and warranty in entering into and performing
this Agreement), and the Company's representation and warranty under this
Section shall survive the Closing.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel for Seller may
reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock; and
(c) each of them shall have delivered such good standing
certificates, officer certificates, and similar documents and certificates as
counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
Seller, regardless of when such claim, debt, obligation or liability arose, is
asserted, or may have been asserted or (iii) any obligations or liabilities with
respect to any claims arising out of actions or omissions, that occurred prior
to the Closing Date, by any of the Company's directors, officers, shareholders,
agents, employees, representatives, subsidiaries and/or affiliates.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of (i) any breach or default
by Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document, or (ii) any claim,
debt, obligation or liability of Seller, regardless of when such claim, debt,
obligation or liability arose, is asserted, or may have been asserted.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to Seller and the Company, as applicable, of the
commencement or assertion of any third party action in respect of which such
Prime Indemnified Party shall seek indemnification hereunder. Any failure to so
notify Seller and the Company shall not relieve Seller or the Company from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices
Seller and the Company. Seller and the Company shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) Seller and the Company shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) Seller and the Company shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) Seller and the Company shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which Seller and the Company fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of Seller or the Company, without the prior
written consent of Seller and the Company.
(e) Seller and the Company shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse
Seller and the Company for the full amount of such payments if the Prime
Indemnified Party is ultimately determined not to be entitled to such
indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required to indemnify another party to this Agreement in respect of
such act, omission or other matter.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. This Agreement (including, without limitation, the
provisions contained in ARTICLE VIII) is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable but the extent of the invalidity or unenforceability
does not destroy the basis of the bargain between the parties as contained
herein, the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be effected thereby, but rather shall
be enforced to the fullest extent permitted by law.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: The Corporation of the President
of the Church of Xxxxx Xxxxxx
of Latter-Day Saints,
a Utah Corporation Sole
c/o Xxxx X. Xxxxxxx
0000 Xxxx Xxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of any person who is or was an
officer or director of the Company during calendar year 1999, and any employee
of the Company who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Seller: Signature: /s/ Xxx Xxxxxxxx
Printed Name: Xxx Xxxxxxxx, authorized agent
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
[Signature page for Prime follows]
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, Vice President
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxx X. Xxxxx,
III and Xxxx X. Xxxxx, individuals residing in San Ramon, California, and
shareholders of the Company (collectively and individually referred to as
"Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time,
22,663 authorized and issued shares of the Company's $0.01 par value common
stock presently owned by Seller and evidenced by stock certificate number C-26
and C-47 (collectively, the "Capital Stock"). The purchase price for the Capital
Stock shall be $257,063.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of the Company and Seller
Seller and the Company hereby represent and warrant to Prime, jointly
and severally, that each of the following matters is true and correct in all
respects as of the Closing Date (with the understanding that Prime is relying
materially on each such representation and warranty in entering into and
performing this Agreement), which representations and warranties shall also be
deemed made as of the Effective Time and which shall survive the Closing;
provided, however, that all representations and warranties made by Seller
hereunder shall be deemed made by Seller only to the actual knowledge of Seller.
3.1 Due Organization. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada and
has full power and authority to carry on its business as now conducted and as
proposed to be conducted. The Company is qualified to do business and is in good
standing in the states set forth on Schedule 3.1(a) attached hereto, which
states represent every jurisdiction where such qualification is required for the
conduct of the Company's business as conducted on the Closing Date. Complete and
correct copies of the Company's Articles of Incorporation, Bylaws, all board of
directors' resolutions, all shareholders' resolutions, and all amendments
thereto, have been delivered to Prime. Schedule 3.1(b) sets forth a true and
complete list, as of the Closing Date, of all of the holders of any equity or
other ownership interest in the Company or of any right to obtain, by conversion
or otherwise, and regardless of whether presently exercisable, any equity or
other ownership interest in the Company; in each case showing the number and
type of interest or right held. Schedule 3.1(b) also identifies each of the
persons listed therein that is a physician or other licensed medical
professional, and describes each such person's license(s) and professional
title. Except as set forth on Schedule 3.1(b), immediately prior to the Closing
Date there are outstanding (i) no shares of equity or other voting securities of
the Company, (ii) no securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) no options
or other rights to acquire from the Company or Seller, and no obligation of the
Company or Seller to issue or sell, any equity or other voting securities of the
Company or any securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) no equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company. Immediately following
the Closing of this transaction and the closings of the Related Acquisitions (as
hereinafter defined), Prime will own sixty percent (60%) of all of the voting
equity securities of the Company (after assuming the conversion, exchange or
exercise of any and all securities or rights convertible into, or exchangeable
or exercisable for, voting equity securities of the Company), and all of those
persons and entities listed on Schedule 3.1(b) will own, in the aggregate, forty
percent (40%) of all of the voting equity securities of the Company (after
assuming the conversion, exchange or exercise of any and all securities or
rights convertible into, or exchangeable or exercisable for, voting equity
securities of the Company). The Capital Stock transferred by Seller to Prime at
the Closing, as well as all other capital stock of the Company transferred to
Prime in the Related Acquisitions, will be duly authorized, validly issued and
outstanding, fully paid, non-assessable, and free of any liens, claims or
encumbrances whatsoever.
3.2 Subsidiaries. Except as set forth on Schedule 3.2 (reflecting
ownership interests and the nature of such interests), the Company does not
directly or indirectly have (or possess any options or other rights to acquire)
any subsidiaries or any direct or indirect ownership interests in any person,
business, corporation, partnership, limited liability company, association,
joint venture, trust, or other entity.
3.3 Due Authorization. Each of the Company and Seller has full power
and authority to enter into and perform this Agreement and each Transaction
Document required to be executed by the Company or Seller in connection
herewith. The execution, delivery, and performance of this Agreement and each
such Transaction Document has been duly authorized by all necessary action of
the Company, its directors, its officers and its shareholders. This Agreement
and each such Transaction Document has been duly and validly executed and
delivered by the Company and Seller and constitutes a valid and binding
obligation of the Company and Seller, enforceable against each of them in
accordance with its terms. The execution, delivery, and performance of this
Agreement, and each Transaction Document required herein to be executed by
Seller and/or the Company do not (a) violate any federal, state, county, or
local law, rule, or regulation applicable to the Company, the Business (as
hereinafter defined), the Company's assets or the Capital Stock, (b) violate or
conflict with, or permit the cancellation of, any agreement to which the Company
is a party, or by which the Company or its properties are bound, or result in
the creation of any lien, security interest, charge, or encumbrance upon any of
such properties or the upon the Capital Stock, (c) permit the acceleration of
the maturity of any indebtedness of Seller or the Company, or any indebtedness
secured by the Capital Stock or by the property of the Company, or (d) violate
or conflict with any provision of the organizational documents of the Company.
No action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller or the Company in
connection with the execution, delivery, or performance of this Agreement (or
any Transaction Document).
3.4 Financial Statements. The unaudited balance sheet and income
statement of the Company as of and for each of the years ended March 31, 1998
and 1999, and the unaudited balance sheet and income statement of the Company as
of and for the three (3) months ended June 30, 1999 (collectively, the
"Financial Statements") are attached hereto as Exhibit A. The Financial
Statements have been prepared in accordance with generally accepted accounting
principles consistently applied ("GAAP") (except as specifically noted therein
or in Schedule 3.4) and fairly present the financial position and results of
operations of the Company as of the indicated dates and for the indicated
periods. Except for liabilities incurred in the ordinary course of business or
disclosed in Schedule 3.4, and except to the extent specifically and fully
reflected in the Financial Statements (including the notes thereto), as of the
Closing Date, the Company has no claims, debts, liabilities, or obligations,
whether known or unknown, absolute, contingent or otherwise (including, but not
limited to, federal, state, and local taxes, any sales taxes, use taxes and
property taxes, any taxes arising from the transactions contemplated by this
Agreement and any liabilities arising from any litigation or civil, criminal or
regulatory proceeding involving or related to the Company, its assets or the
Business). The Company and Seller each agree to indemnify and hold harmless
Prime and its affiliates from and against any and all such claims, debts,
liabilities and obligations. Except as set forth in Schedule 3.4 hereto, since
June 30, 1999 there has been no material adverse change in the assets of the
Company, the Business, or the results of operations or financial position of the
Company.
3.5 Conduct of Business; Certain Actions. As used herein, "Business"
means all of the business conducted by the Company, which shall be deemed to
include all refractive surgery modalities, now performed, offered or made
available, including, without limitation, implantable contact lenses, instromal
corneal rings, laser in situs keratomileusis photorefractive keratectomy,
automated lemellar keratoplasty, radial keratotomy, astigmatic keratotomy and
similar procedures. Except as set forth on Schedule 3.5 attached hereto, since
June 30, 1999, the Company has conducted its Business and operations of the
Business in the ordinary course and consistent with its past practices and has
not (a) purchased or retired any indebtedness, or purchased, retired, or
redeemed any ownership interest from, any director, officer, shareholder,
employee or affiliate of the Company, or engaged in any other transaction that
involves or requires distributions of money or other assets from the Company to
any director, officer, shareholder, employee or affiliate of the Company if such
other transaction is not done in the ordinary course of business and is not
consistent with past practices of the Company, (b) increased the compensation of
any directors, officers, employees, agents, contractors, vendors or other
parties, except for wage and salary increases made in the ordinary course of
business and consistent with the past practices of the Company, (c) made capital
expenditures exceeding $10,000 individually or $25,000 in the aggregate, (d)
sold any asset (or any group of related assets) in any transaction (or series of
related transactions) in which the purchase price or book value for such asset
(or group of related assets) exceeded $10,000, (e) discharged or satisfied any
lien or encumbrance or paid any obligation or liability, absolute or contingent,
other than current liabilities incurred and paid in the ordinary course of
business, (f) made or guaranteed any loans or advances to any party whatsoever,
(g) suffered or permitted any lien, security interest, claim, charge, or other
encumbrance to arise or be granted or created against or upon any of its assets,
real or personal, tangible or intangible, (h) canceled, waived, or released any
of its debts, rights, or claims against third parties, (i) amended its
organizational documents, (j) made or paid any severance or termination payment
to any director, officer, employee, agent, contractor, vendor or consultant, (k)
made any change in its method of accounting, (l) made any investment or
commitment therefor in any person, business, corporation, association,
partnership, limited liability company, joint venture, trust, or other entity,
(m) made, entered into, amended, or terminated any written employment contract,
created, made, amended, or terminated any bonus, stock option, pension,
retirement, profit sharing, or other employee benefit plan or arrangement, or
withdrawn from any "multi-employer plan" (as defined in the Internal Revenue
Code of 1986, as amended (the "Code")) so as to create any liability under ERISA
(as hereinafter defined) to any person or entity, (n) amended, terminated or
experienced a termination of any material contract, agreement, lease, franchise,
or license to which it is a party, (o) made any distributions, in cash or in
kind, to its shareholders, or to any person or entity related to or affiliated
therewith, in any capacity, except such distributions as are made in the
ordinary course of the Company's business consistent with past practices, (p)
entered into any other material transactions except in the ordinary course of
business, (q) entered into any contract, commitment, agreement, or understanding
to do any acts described in the foregoing clauses (a)-(p) of this Section, (r)
suffered any material damage, destruction, or loss (whether or not covered by
insurance) to any assets, (s) experienced any strike, slowdown, or demand for
recognition by a labor organization by or with respect to any of its employees,
or (t) experienced or effected any shutdown, slow-down, or cessation of any
operations conducted by, or constituting part of, it.
3.6 Assets; Licenses, Permits, etc. Except as set forth on Schedule
3.6(a), the Company has good and marketable title to all of its assets, free and
clear of all liens, security interests, claims, rights of another, and
encumbrances of any kind whatsoever. The assets of the Company are in good
operating condition and repair, subject to ordinary wear and tear, taking into
account the respective ages of the properties involved and are all that are
necessary for the conduct of the Business. Attached hereto as Schedule 3.6(b) is
a list and description of all federal, state, county, and local governmental
licenses, certificates, certificates of need, permits, waivers, filings and
orders held or applied for by the Company and used or relied on (or to be used
or relied on) in connection with the Business ("Permits"). The Company has
complied in all material respects, and the Company is in compliance in all
material respects, with the terms and conditions of any such Permits. No
additional Permit is required from any federal, state, county, or local
governmental agency or body thereof in connection with the conduct of the
Business. No claim has been made by any governmental authority (and, to the
knowledge of Seller and the Company, no such claim has been threatened) to the
effect that a Permit not possessed by the Company is necessary in respect of the
Business.
3.7 Environmental Issues.
(a) For purposes of this Agreement, the term "environmental
laws" shall mean all laws and regulations relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling, or the emission, discharge, or release, of any pollutant, contaminant,
chemical, or industrial toxic or hazardous substance or waste, and any order
related thereto.
(b) The Company has complied in all material respects with and
obtained all authorizations and made all filings required by all applicable
environmental laws. The properties occupied or used by the Company have not been
contaminated with any hazardous wastes, hazardous substances, or other hazardous
or toxic materials in violation of any applicable environmental law, the
violation of which could have a material adverse impact on the Business or the
financial position of the Company.
(c) The Company has not received any notice from the United
States Environmental Protection Agency that it is a potentially responsible
party under the Comprehensive Environmental Response, Compensation and Liability
Act ("Superfund Notice"), any citation from any federal, state or local
governmental authority for non-compliance with its requirements with respect to
air, water or environmental pollution, or the improper storage, use or discharge
of any hazardous waste, other waste or other substance or other material
pertaining to its business ("Citations") or any written notice from any private
party alleging any such non-compliance; and there are no pending or unresolved
Superfund Notices, Citations or written notices from private parties alleging
any such non-compliance.
3.8 Intellectual Property Rights. There are no patents, trademarks,
trade names, or copyrights, and no applications therefor, owned by or registered
in the name of the Company or in which the Company has any right, license, or
interest. The Company is not a party to any license agreement, either as
licensor or licensee, with respect to any patents, trademarks, trade names, or
copyrights. The Company has not received any notice that it is infringing any
patent, trademark, trade name, or copyright of others.
3.9 Compliance with Laws. To the knowledge of the Company and Seller,
the Company has complied in all material respects, and the Company is in
compliance in all material respects, with all federal, state, county, and local
laws, rules, regulations and ordinances currently in effect. No claim has been
made or threatened by any governmental authority against the Company to the
effect that the business conducted by the Company fails to comply in any respect
with any law, rule, regulation, or ordinance.
3.10 Insurance. Attached hereto as Schedule 3.10 is a list of all
policies of fire, liability, business interruption, and other forms of insurance
(including, without limitation, professional liability insurance) and all
fidelity bonds held by or applicable to the Company at any time within the past
three (3) years, which schedule sets forth in respect of each such policy the
policy name, policy number, carrier, term, type of coverage, deductible amount
or self-insured retention amount, limits of coverage, and annual premium. To the
knowledge of the Company and Seller, no event directly relating to the Company
has occurred which will result in a retroactive upward adjustment of premiums
under any such policies or which is likely to result in any prospective upward
adjustment in such premiums. There have been no material changes in the type of
insurance coverage maintained by the Company during the past three (3) years,
including without limitation any change which has resulted in any period during
which the Company had no insurance coverage. Excluding insurance policies which
have expired and been replaced, no insurance policy of the Company has been
canceled within the last three (3) years and no threat has been made to cancel
any insurance policy of the Company within such period.
3.11 Employee Benefit Matters. Except as set forth on Schedule 3.11,
the Company does not maintain nor does it contribute nor is it required to
contribute to any "employee welfare benefit plan" (as defined in section 3(1) of
the Employee Retirement Income Security Act of 1974 (and any sections of the
Code amended by it) and all regulations promulgated thereunder, as the same have
from time to time been amended ("ERISA")) or any "employee pension benefit plan"
(as defined in ERISA). The Company does not presently maintain and has never
maintained, or had any obligation of any nature to contribute to, a "defined
benefit plan" within the meaning of the Code.
3.12 Contracts and Agreements. Attached hereto as Schedule 3.12 is a
list of all written or oral contracts, commitments, leases, and other agreements
(including, without limitation, all promissory notes, loan agreements, and other
evidences of indebtedness, mortgages, deeds of trust, security agreements,
pledge agreements, service agreements, and similar agreements and instruments
and all confidentiality agreements) to which the Company is a party or by which
the Company or its properties are bound, pursuant to which the obligations
thereunder of any party thereto are, or are contemplated as being, in respect of
any such individual contracts, commitments, leases, or other agreements during
any year during the term thereof, $25,000 or greater, or which are otherwise
material to the Business (collectively the "Contracts" and individually, a
"Contract"). The Company is not and, to the best knowledge of the Company and
Seller, no other party thereto is in default (and no event has occurred which,
with the passage of time or the giving of notice, or both, would constitute a
default by the Company or, to the best knowledge of the Company and Seller, by
any other party thereto) under any Contract. The Company has not waived any
material right under any Contract, and no consents or approvals (other than
those obtained in writing and delivered to Prime prior to Closing) are required
under any Contract in connection with the sale of Capital Stock or the
consummation of the transactions contemplated hereby. The Company has not
guaranteed any obligation of any other person or entity.
3.13 Claims and Proceedings. Attached hereto as Schedule 3.13 is a list
and description of all claims, actions, suits, proceedings, and investigations
pending or, to the knowledge of the Company and Seller, threatened against the
Company, at law or in equity, or before or by any court, municipal or other
governmental department, commission, board, agency, or instrumentality. Except
as set forth on Schedule 3.13 attached hereto, none of such claims, actions,
suits, proceedings, or investigations will result in any liability or loss to
the Company which (individually or in the aggregate) is material, and the
Company has not been, and the Company is not now, subject to any order,
judgment, decree, stipulation, or consent of any court, governmental body, or
agency. No inquiry, action, or proceeding has been asserted, instituted, or
threatened against the Company or Seller to restrain or prohibit the carrying
out of the transactions contemplated by this Agreement or to challenge the
validity of such transactions or any part thereof or seeking damages on account
thereof.
3.14 Taxes. All federal, foreign, state, county, and local income,
gross receipts, excise, property, franchise, license, sales, use, withholding,
and other tax (collectively, "Taxes") returns, reports, and declarations of
estimated tax (collectively, "Returns") which were required to be filed by the
company on or before the date hereof have been filed within the time (including
any applicable extensions) and in the manner provided by law, and all such
Returns are true and correct in all material respects and accurately reflect the
Tax liabilities of the Company. The Company has provided Prime with copies of
all returns filed for and during the years ended 1998, 1997 and (to the extent
an extension was filed for any return for the year ended 1998) 1996. All Taxes,
assessments, penalties, and interest which have become due pursuant to such
Returns have been paid or adequately accrued in the Financial Statements. The
provisions for Taxes reflected on the balance sheet contained in the Financial
Statements are adequate to cover all of the Company's estimated Tax liabilities
for the respective periods then ended and all prior periods. As of the Closing
Date, the Company will not owe any Taxes for any period prior to the Closing
which are not reflected on the Financial Statements, except for Taxes
attributable to the operations of the Company between June 30, 1999 and the
Closing Date. The Company has not executed any presently effective waiver or
extension of any statute of limitations against assessments and collection of
Taxes. There are no pending or threatened claims, assessments, notices,
proposals to assess, deficiencies, or audits (collectively, "Tax Actions")
against the Company with respect to any Taxes owed or allegedly owed by the
Company. There are no tax liens on any of the assets of the Company. Proper and
accurate amounts have been withheld and remitted by the Company from and in
respect of all persons from whom it is required by applicable law to withhold
for all periods in compliance with the tax withholding provisions of all
applicable laws and regulations. The Company is not a party to any tax sharing
agreement.
3.15 Personnel. Attached hereto as Schedule 3.15 is a list of names and
current annual rates of compensation of the officers, employees or agents of the
Company who are necessary for the operation of the Business (the "Employees").
Except as set forth on Schedule 3.15, there are no bonus, profit sharing,
percentage compensation, company automobile, club membership, and other like
benefits, if any, paid or payable by the Company to any Employees from December
31, 1998 through the Closing Date. Schedule 3.15 attached hereto also contains a
brief description of all material terms of employment agreements and
confidentiality agreements to which the Company is a party and all severance
benefits which any director, officer, Employee or sales representative of the
Company is or may be entitled to receive. The Company has delivered to Prime
accurate and complete copies of all such employment agreements, confidentiality
agreements, and all other agreements, plans, and other instruments to which the
Company is a party and under which its employees are entitled to receive
benefits of any nature. There is no pending or threatened (i) labor dispute or
union organization campaign relating to the Company, (ii) claims against the
Company by any employees of the Company (other than those certain Workers'
Compensation claims specifically described on Schedule 3.13), or (iii)
terminations, resignations or retirements of any employees of the Company. None
of the employees of the Company are represented by any labor union or
organization. There is no unfair labor practice claim against the Company before
the National Labor Relations Board or any strike, labor dispute, work slowdown,
or work stoppage pending or threatened against or involving the Company.
3.16 Business Relations. The Company has no reason to believe and has
not been notified that any supplier or customer of the Company will cease or
refuse to do business with the Company in the same manner as previously
conducted with the Company as a result of or within one (1) year after the
consummation of the transactions contemplated hereby, to the extent such
cessation or refusal might affect the Business. The Company has not received any
notice of any disruption (including delayed deliveries or allocations by
suppliers) in the availability of the materials or products used by the Company.
3.17 Working Capital. Except as set forth on Schedule 3.17 attached
hereto, all of the accounts, notes, and loans receivable (the "Accounts
Receivable") reflected in the Financial Statements, or arising since June 30,
1999, arose from transactions occurring in the ordinary course of the Company's
business as previously conducted, are bona fide and represent amounts validly
due, subject to offsets or defenses. Except for accounts payable and other
accrued expenses incurred in the ordinary course of the Company's business since
June 30, 1999 and consistent with past practices of the Company, there are no
liabilities of the Company other than those reflected in the Financial
Statements. Adequate provision has been made for uncollectible Accounts
Receivable. Since June 30, 1999, the Company has collected its Accounts
Receivable and has paid or performed all liabilities and obligations of the
Company in the ordinary course, consistent with past practices. The Working
Capital (as hereinafter defined) of the Company existing on the Closing Date is
equal to or greater than $100,000.
3.18 Agents. Except as set forth on Schedule 3.18 attached hereto, the
Company has not designated or appointed any person (other than the Company's
employees and officers) or other entity to act for it or on its behalf pursuant
to any power of attorney or any agency which is presently in effect.
3.19 Indebtedness To and From Directors, Officers, Shareholders and
Employees. The Company does not owe any indebtedness to any of its directors,
officers, shareholders, employees or affiliates, or have indebtedness owed to it
from any of its directors, officers, shareholders, employees or affiliates,
excluding indebtedness for travel advances or similar advances for expenses
incurred on behalf of and in the ordinary course of business of the Company and
consistent with the Company's past practices. As of the Effective Time and the
Closing Date all amounts due the Company from any of its directors, officers,
employees or affiliates (or any of their family members) shall have been repaid
in full.
3.20 Commission Sales Contracts. Except as disclosed in Schedule 3.20
attached hereto, the Company does not employ or have any relationship with any
individual, corporation, partnership, or other entity whose compensation from
the Company is in whole or in part determined on a commission basis.
3.21 Certain Consents. Except as set forth on Schedule 3.21 attached
hereto, there are no consents, waivers, or approvals required to be executed
and/or obtained by the Company from third parties in connection with the
execution, delivery, and performance of this Agreement or any of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement (all of which are collectively
referred to as the "Transaction Documents").
3.22 Brokers. The Company has not engaged, or caused any liability to
be incurred to, any finder, broker, or sales agent (and has not paid, and will
not pay, any finders fee or similar fee or commission to any person) in
connection with the execution, delivery, or performance of this Agreement or the
transactions contemplated hereby.
3.23 Interest in Competitors, Suppliers, and Customers. Except as set
forth on Schedule 3.23 attached hereto, neither the Company nor any affiliate of
the Company, and to the knowledge of the Company and Seller, no director,
officer, employee or affiliate of the Company or any affiliate of any director,
officer, employee or affiliate of the Company, has any ownership interest in any
competitor, customer or supplier of the Company or any property used in the
operation of the Business.
3.24 Warranties. Except as set forth on Schedule 3.24, the Company has
not made any warranties or guarantees to third parties with respect to any
products sold or services rendered by it. Except as set forth on Schedule 3.24
attached hereto, no claims for breach of product or service warranties have been
made against the Company since January 1, 1996.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to which it is a
party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel for Seller may
reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit B;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit C, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit D, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
the Company, not specifically and fully reflected by item and amount on either
Schedule 3.4 or in the Financial Statements, that is or may be asserted with
respect to any acts or omissions occurring, or circumstances existing, on or
prior to the Closing Date, except for liabilities incurred in the ordinary
course of business, or (iii) any obligations or liabilities with respect to any
claims arising out of actions or omissions, that occurred prior to the Closing
Date, by any of the Company's directors, officers, shareholders, agents,
employees, representatives, subsidiaries and/or affiliates.
(b) Seller agrees to indemnify and hold harmless each of the
Prime Indemnified Parties from and against any and all Indemnified Costs in
connection with the commencement or assertion of any third-party action which
any of the Prime Indemnified Parties may sustain, arising out of any breach or
default by Seller of any of its representations, warranties, covenants or
agreements contained in this Agreement or any Transaction Document.
(c) Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 6.1
unless and until such time as all claims of all Prime Indemnified Parties, taken
together, exceed $10,000 in the aggregate, at which time all claims of such
Prime Indemnified Parties may be asserted individually or in combination
(beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1 shall be limited to the aggregate Purchase Price received by Seller
under this Agreement, plus the greater of (a) the value of all remaining equity
interests which Seller holds in the Company at the time of Closing or (b) the
value of all remaining equity interests which Seller holds in the Company at the
time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party shall be
entitled to assert any claim for indemnification under this Section 7.1 unless
and until such time as all claims of such Seller Indemnified Party, individually
and not in combination with other Seller Indemnified Parties, exceed $25,000 in
the aggregate, at which time all claims of such Seller Indemnified Party may be
asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), (iii)
relocation of Seller's primary residence outside of a two hundred (200) mile
radius of the center or facility at which Seller primarily renders services, or
(iv) if Seller is a physician or other practicing licensed professional, the
performance by Seller, during any one-month period, of greater than thirty (30%)
of his or her professional medical activities outside of a two hundred (200)
mile radius of the center or facility primarily utilized by Seller prior to the
date of this Agreement; the Seller's executor, administrator, trustee,
custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or relocation of primary residence or practice, as the case may be, within which
time it may require that the Company purchase (subject to the remaining
provisions of this subsection) all of Seller's capital stock of the Company,
upon the terms and conditions hereinafter set forth, by giving notice of such
election in writing to the Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. Without in any way limiting or
qualifying the representation and warranty with respect to Working Capital
contained in Section 3.17, all parties to this Agreement acknowledge and agree
that no shareholder of the Company, or any other party, has any obligation
existing on the Closing Date to make a capital contribution to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH
CERTAIN CONDITIONS SPECIFIED IN A CERTAIN STOCK PURCHASE
AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1, 1999, A COMPLETE
AND CORRECT COPY OF WHICH IS AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED TO THE
HOLDER HEREOF UPON WRITTEN REQUEST AND WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Invalid Provisions. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable under present or future laws, such
provision shall be fully severable, this Agreement shall be construed as if such
illegal, invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xx., Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxx X. and Xxxx X. Xxxxx
0000 Xxxxxx Xxxx Xxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by proper
notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless of
any investigation at any time made by or on behalf of any party hereto or of any
information any party may have in respect thereof, all covenants, agreements,
representations, and warranties made hereunder or pursuant hereto or in
connection with the transactions contemplated hereby shall survive the Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of the officers of the Company
holding office immediately prior to the Closing, and any employee of the Company
who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title: Secretary & Manager
Seller: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
/s/ Xxxx X. Xxxxx
Printed Name: Xxxx X. Xxxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Financial Statements
EXHIBIT B: Form of Exclusive Use Agreement
EXHIBIT C: Form of Assignment and Security Agreement
EXHIBIT D: Form of Amended and Restated Bylaws of Seller
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxx Xxxxxx
Xxxxxxx, M.D., Family Revocable Trust dated February 8, 1991, and a shareholder
of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time,
23,939 authorized and issued shares of the Company's $0.01 par value common
stock presently owned by Seller and evidenced by stock certificate number C- 22
and C-59 (collectively, the "Capital Stock"). The purchase price for the Capital
Stock shall be $271,537.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of the Company and Seller
Seller and the Company hereby represent and warrant to Prime, jointly
and severally, that each of the following matters is true and correct in all
respects as of the Closing Date (with the understanding that Prime is relying
materially on each such representation and warranty in entering into and
performing this Agreement), which representations and warranties shall also be
deemed made as of the Effective Time and which shall survive the Closing;
provided, however, that all representations and warranties made by Seller
hereunder shall be deemed made by Seller only to the actual knowledge of Seller.
3.1 Due Organization. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada and
has full power and authority to carry on its business as now conducted and as
proposed to be conducted. The Company is qualified to do business and is in good
standing in the states set forth on Schedule 3.1(a) attached hereto, which
states represent every jurisdiction where such qualification is required for the
conduct of the Company's business as conducted on the Closing Date. Complete and
correct copies of the Company's Articles of Incorporation, Bylaws, all board of
directors' resolutions, all shareholders' resolutions, and all amendments
thereto, have been delivered to Prime. Schedule 3.1(b) sets forth a true and
complete list, as of the Closing Date, of all of the holders of any equity or
other ownership interest in the Company or of any right to obtain, by conversion
or otherwise, and regardless of whether presently exercisable, any equity or
other ownership interest in the Company; in each case showing the number and
type of interest or right held. Schedule 3.1(b) also identifies each of the
persons listed therein that is a physician or other licensed medical
professional, and describes each such person's license(s) and professional
title. Except as set forth on Schedule 3.1(b), immediately prior to the Closing
Date there are outstanding (i) no shares of equity or other voting securities of
the Company, (ii) no securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) no options
or other rights to acquire from the Company or Seller, and no obligation of the
Company or Seller to issue or sell, any equity or other voting securities of the
Company or any securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) no equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company. Immediately following
the Closing of this transaction and the closings of the Related Acquisitions (as
hereinafter defined), Prime will own sixty percent (60%) of all of the voting
equity securities of the Company (after assuming the conversion, exchange or
exercise of any and all securities or rights convertible into, or exchangeable
or exercisable for, voting equity securities of the Company), and all of those
persons and entities listed on Schedule 3.1(b) will own, in the aggregate, forty
percent (40%) of all of the voting equity securities of the Company (after
assuming the conversion, exchange or exercise of any and all securities or
rights convertible into, or exchangeable or exercisable for, voting equity
securities of the Company). The Capital Stock transferred by Seller to Prime at
the Closing, as well as all other capital stock of the Company transferred to
Prime in the Related Acquisitions, will be duly authorized, validly issued and
outstanding, fully paid, non-assessable, and free of any liens, claims or
encumbrances whatsoever.
3.2 Subsidiaries. Except as set forth on Schedule 3.2 (reflecting
ownership interests and the nature of such interests), the Company does not
directly or indirectly have (or possess any options or other rights to acquire)
any subsidiaries or any direct or indirect ownership interests in any person,
business, corporation, partnership, limited liability company, association,
joint venture, trust, or other entity.
3.3 Due Authorization. Each of the Company and Seller has full power
and authority to enter into and perform this Agreement and each Transaction
Document required to be executed by the Company or Seller in connection
herewith. The execution, delivery, and performance of this Agreement and each
such Transaction Document has been duly authorized by all necessary action of
the Company, its directors, its officers and its shareholders. This Agreement
and each such Transaction Document has been duly and validly executed and
delivered by the Company and Seller and constitutes a valid and binding
obligation of the Company and Seller, enforceable against each of them in
accordance with its terms. The execution, delivery, and performance of this
Agreement, and each Transaction Document required herein to be executed by
Seller and/or the Company do not (a) violate any federal, state, county, or
local law, rule, or regulation applicable to the Company, the Business (as
hereinafter defined), the Company's assets or the Capital Stock, (b) violate or
conflict with, or permit the cancellation of, any agreement to which the Company
is a party, or by which the Company or its properties are bound, or result in
the creation of any lien, security interest, charge, or encumbrance upon any of
such properties or the upon the Capital Stock, (c) permit the acceleration of
the maturity of any indebtedness of Seller or the Company, or any indebtedness
secured by the Capital Stock or by the property of the Company, or (d) violate
or conflict with any provision of the organizational documents of the Company.
No action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller or the Company in
connection with the execution, delivery, or performance of this Agreement (or
any Transaction Document).
3.4 Financial Statements. The unaudited balance sheet and income
statement of the Company as of and for each of the years ended March 31, 1998
and 1999, and the unaudited balance sheet and income statement of the Company as
of and for the three (3) months ended June 30, 1999 (collectively, the
"Financial Statements") are attached hereto as Exhibit A. The Financial
Statements have been prepared in accordance with generally accepted accounting
principles consistently applied ("GAAP") (except as specifically noted therein
or in Schedule 3.4) and fairly present the financial position and results of
operations of the Company as of the indicated dates and for the indicated
periods. Except for liabilities incurred in the ordinary course of business or
disclosed in Schedule 3.4, and except to the extent specifically and fully
reflected in the Financial Statements (including the notes thereto), as of the
Closing Date, the Company has no claims, debts, liabilities, or obligations,
whether known or unknown, absolute, contingent or otherwise (including, but not
limited to, federal, state, and local taxes, any sales taxes, use taxes and
property taxes, any taxes arising from the transactions contemplated by this
Agreement and any liabilities arising from any litigation or civil, criminal or
regulatory proceeding involving or related to the Company, its assets or the
Business). The Company and Seller each agree to indemnify and hold harmless
Prime and its affiliates from and against any and all such claims, debts,
liabilities and obligations. Except as set forth in Schedule 3.4 hereto, since
June 30, 1999 there has been no material adverse change in the assets of the
Company, the Business, or the results of operations or financial position of the
Company.
3.5 Conduct of Business; Certain Actions. As used herein, "Business"
means all of the business conducted by the Company, which shall be deemed to
include all refractive surgery modalities, now performed, offered or made
available, including, without limitation, implantable contact lenses, instromal
corneal rings, laser in situs keratomileusis photorefractive keratectomy,
automated lemellar keratoplasty, radial keratotomy, astigmatic keratotomy and
similar procedures. Except as set forth on Schedule 3.5 attached hereto, since
June 30, 1999, the Company has conducted its Business and operations of the
Business in the ordinary course and consistent with its past practices and has
not (a) purchased or retired any indebtedness, or purchased, retired, or
redeemed any ownership interest from, any director, officer, shareholder,
employee or affiliate of the Company, or engaged in any other transaction that
involves or requires distributions of money or other assets from the Company to
any director, officer, shareholder, employee or affiliate of the Company if such
other transaction is not done in the ordinary course of business and is not
consistent with past practices of the Company, (b) increased the compensation of
any directors, officers, employees, agents, contractors, vendors or other
parties, except for wage and salary increases made in the ordinary course of
business and consistent with the past practices of the Company, (c) made capital
expenditures exceeding $10,000 individually or $25,000 in the aggregate, (d)
sold any asset (or any group of related assets) in any transaction (or series of
related transactions) in which the purchase price or book value for such asset
(or group of related assets) exceeded $10,000, (e) discharged or satisfied any
lien or encumbrance or paid any obligation or liability, absolute or contingent,
other than current liabilities incurred and paid in the ordinary course of
business, (f) made or guaranteed any loans or advances to any party whatsoever,
(g) suffered or permitted any lien, security interest, claim, charge, or other
encumbrance to arise or be granted or created against or upon any of its assets,
real or personal, tangible or intangible, (h) canceled, waived, or released any
of its debts, rights, or claims against third parties, (i) amended its
organizational documents, (j) made or paid any severance or termination payment
to any director, officer, employee, agent, contractor, vendor or consultant, (k)
made any change in its method of accounting, (l) made any investment or
commitment therefor in any person, business, corporation, association,
partnership, limited liability company, joint venture, trust, or other entity,
(m) made, entered into, amended, or terminated any written employment contract,
created, made, amended, or terminated any bonus, stock option, pension,
retirement, profit sharing, or other employee benefit plan or arrangement, or
withdrawn from any "multi-employer plan" (as defined in the Internal Revenue
Code of 1986, as amended (the "Code")) so as to create any liability under ERISA
(as hereinafter defined) to any person or entity, (n) amended, terminated or
experienced a termination of any material contract, agreement, lease, franchise,
or license to which it is a party, (o) made any distributions, in cash or in
kind, to its shareholders, or to any person or entity related to or affiliated
therewith, in any capacity, except such distributions as are made in the
ordinary course of the Company's business consistent with past practices, (p)
entered into any other material transactions except in the ordinary course of
business, (q) entered into any contract, commitment, agreement, or understanding
to do any acts described in the foregoing clauses (a)-(p) of this Section, (r)
suffered any material damage, destruction, or loss (whether or not covered by
insurance) to any assets, (s) experienced any strike, slowdown, or demand for
recognition by a labor organization by or with respect to any of its employees,
or (t) experienced or effected any shutdown, slow-down, or cessation of any
operations conducted by, or constituting part of, it.
3.6 Assets; Licenses, Permits, etc. Except as set forth on Schedule
3.6(a), the Company has good and marketable title to all of its assets, free and
clear of all liens, security interests, claims, rights of another, and
encumbrances of any kind whatsoever. The assets of the Company are in good
operating condition and repair, subject to ordinary wear and tear, taking into
account the respective ages of the properties involved and are all that are
necessary for the conduct of the Business. Attached hereto as Schedule 3.6(b) is
a list and description of all federal, state, county, and local governmental
licenses, certificates, certificates of need, permits, waivers, filings and
orders held or applied for by the Company and used or relied on (or to be used
or relied on) in connection with the Business ("Permits"). The Company has
complied in all material respects, and the Company is in compliance in all
material respects, with the terms and conditions of any such Permits. No
additional Permit is required from any federal, state, county, or local
governmental agency or body thereof in connection with the conduct of the
Business. No claim has been made by any governmental authority (and, to the
knowledge of Seller and the Company, no such claim has been threatened) to the
effect that a Permit not possessed by the Company is necessary in respect of the
Business.
3.7 Environmental Issues.
(a) For purposes of this Agreement, the term "environmental
laws" shall mean all laws and regulations relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling, or the emission, discharge, or release, of any pollutant, contaminant,
chemical, or industrial toxic or hazardous substance or waste, and any order
related thereto.
(b) The Company has complied in all material respects with and
obtained all authorizations and made all filings required by all applicable
environmental laws. The properties occupied or used by the Company have not been
contaminated with any hazardous wastes, hazardous substances, or other hazardous
or toxic materials in violation of any applicable environmental law, the
violation of which could have a material adverse impact on the Business or the
financial position of the Company.
(c) The Company has not received any notice from the United
States Environmental Protection Agency that it is a potentially responsible
party under the Comprehensive Environmental Response, Compensation and Liability
Act ("Superfund Notice"), any citation from any federal, state or local
governmental authority for non-compliance with its requirements with respect to
air, water or environmental pollution, or the improper storage, use or discharge
of any hazardous waste, other waste or other substance or other material
pertaining to its business ("Citations") or any written notice from any private
party alleging any such non-compliance; and there are no pending or unresolved
Superfund Notices, Citations or written notices from private parties alleging
any such non-compliance.
3.8 Intellectual Property Rights. There are no patents, trademarks,
trade names, or copyrights, and no applications therefor, owned by or registered
in the name of the Company or in which the Company has any right, license, or
interest. The Company is not a party to any license agreement, either as
licensor or licensee, with respect to any patents, trademarks, trade names, or
copyrights. The Company has not received any notice that it is infringing any
patent, trademark, trade name, or copyright of others.
3.9 Compliance with Laws. To the knowledge of the Company and Seller,
the Company has complied in all material respects, and the Company is in
compliance in all material respects, with all federal, state, county, and local
laws, rules, regulations and ordinances currently in effect. No claim has been
made or threatened by any governmental authority against the Company to the
effect that the business conducted by the Company fails to comply in any respect
with any law, rule, regulation, or ordinance.
3.10 Insurance. Attached hereto as Schedule 3.10 is a list of all
policies of fire, liability, business interruption, and other forms of insurance
(including, without limitation, professional liability insurance) and all
fidelity bonds held by or applicable to the Company at any time within the past
three (3) years, which schedule sets forth in respect of each such policy the
policy name, policy number, carrier, term, type of coverage, deductible amount
or self-insured retention amount, limits of coverage, and annual premium. To the
knowledge of the Company and Seller, no event directly relating to the Company
has occurred which will result in a retroactive upward adjustment of premiums
under any such policies or which is likely to result in any prospective upward
adjustment in such premiums. There have been no material changes in the type of
insurance coverage maintained by the Company during the past three (3) years,
including without limitation any change which has resulted in any period during
which the Company had no insurance coverage. Excluding insurance policies which
have expired and been replaced, no insurance policy of the Company has been
canceled within the last three (3) years and no threat has been made to cancel
any insurance policy of the Company within such period.
3.11 Employee Benefit Matters. Except as set forth on Schedule 3.11,
the Company does not maintain nor does it contribute nor is it required to
contribute to any "employee welfare benefit plan" (as defined in section 3(1) of
the Employee Retirement Income Security Act of 1974 (and any sections of the
Code amended by it) and all regulations promulgated thereunder, as the same have
from time to time been amended ("ERISA")) or any "employee pension benefit plan"
(as defined in ERISA). The Company does not presently maintain and has never
maintained, or had any obligation of any nature to contribute to, a "defined
benefit plan" within the meaning of the Code.
3.12 Contracts and Agreements. Attached hereto as Schedule 3.12 is a
list of all written or oral contracts, commitments, leases, and other agreements
(including, without limitation, all promissory notes, loan agreements, and other
evidences of indebtedness, mortgages, deeds of trust, security agreements,
pledge agreements, service agreements, and similar agreements and instruments
and all confidentiality agreements) to which the Company is a party or by which
the Company or its properties are bound, pursuant to which the obligations
thereunder of any party thereto are, or are contemplated as being, in respect of
any such individual contracts, commitments, leases, or other agreements during
any year during the term thereof, $25,000 or greater, or which are otherwise
material to the Business (collectively the "Contracts" and individually, a
"Contract"). The Company is not and, to the best knowledge of the Company and
Seller, no other party thereto is in default (and no event has occurred which,
with the passage of time or the giving of notice, or both, would constitute a
default by the Company or, to the best knowledge of the Company and Seller, by
any other party thereto) under any Contract. The Company has not waived any
material right under any Contract, and no consents or approvals (other than
those obtained in writing and delivered to Prime prior to Closing) are required
under any Contract in connection with the sale of Capital Stock or the
consummation of the transactions contemplated hereby. The Company has not
guaranteed any obligation of any other person or entity.
3.13 Claims and Proceedings. Attached hereto as Schedule 3.13 is a list
and description of all claims, actions, suits, proceedings, and investigations
pending or, to the knowledge of the Company and Seller, threatened against the
Company, at law or in equity, or before or by any court, municipal or other
governmental department, commission, board, agency, or instrumentality. Except
as set forth on Schedule 3.13 attached hereto, none of such claims, actions,
suits, proceedings, or investigations will result in any liability or loss to
the Company which (individually or in the aggregate) is material, and the
Company has not been, and the Company is not now, subject to any order,
judgment, decree, stipulation, or consent of any court, governmental body, or
agency. No inquiry, action, or proceeding has been asserted, instituted, or
threatened against the Company or Seller to restrain or prohibit the carrying
out of the transactions contemplated by this Agreement or to challenge the
validity of such transactions or any part thereof or seeking damages on account
thereof.
3.14 Taxes. All federal, foreign, state, county, and local income,
gross receipts, excise, property, franchise, license, sales, use, withholding,
and other tax (collectively, "Taxes") returns, reports, and declarations of
estimated tax (collectively, "Returns") which were required to be filed by the
company on or before the date hereof have been filed within the time (including
any applicable extensions) and in the manner provided by law, and all such
Returns are true and correct in all material respects and accurately reflect the
Tax liabilities of the Company. The Company has provided Prime with copies of
all returns filed for and during the years ended 1998, 1997 and (to the extent
an extension was filed for any return for the year ended 1998) 1996. All Taxes,
assessments, penalties, and interest which have become due pursuant to such
Returns have been paid or adequately accrued in the Financial Statements. The
provisions for Taxes reflected on the balance sheet contained in the Financial
Statements are adequate to cover all of the Company's estimated Tax liabilities
for the respective periods then ended and all prior periods. As of the Closing
Date, the Company will not owe any Taxes for any period prior to the Closing
which are not reflected on the Financial Statements, except for Taxes
attributable to the operations of the Company between June 30, 1999 and the
Closing Date. The Company has not executed any presently effective waiver or
extension of any statute of limitations against assessments and collection of
Taxes. There are no pending or threatened claims, assessments, notices,
proposals to assess, deficiencies, or audits (collectively, "Tax Actions")
against the Company with respect to any Taxes owed or allegedly owed by the
Company. There are no tax liens on any of the assets of the Company. Proper and
accurate amounts have been withheld and remitted by the Company from and in
respect of all persons from whom it is required by applicable law to withhold
for all periods in compliance with the tax withholding provisions of all
applicable laws and regulations. The Company is not a party to any tax sharing
agreement.
3.15 Personnel. Attached hereto as Schedule 3.15 is a list of names and
current annual rates of compensation of the officers, employees or agents of the
Company who are necessary for the operation of the Business (the "Employees").
Except as set forth on Schedule 3.15, there are no bonus, profit sharing,
percentage compensation, company automobile, club membership, and other like
benefits, if any, paid or payable by the Company to any Employees from December
31, 1998 through the Closing Date. Schedule 3.15 attached hereto also contains a
brief description of all material terms of employment agreements and
confidentiality agreements to which the Company is a party and all severance
benefits which any director, officer, Employee or sales representative of the
Company is or may be entitled to receive. The Company has delivered to Prime
accurate and complete copies of all such employment agreements, confidentiality
agreements, and all other agreements, plans, and other instruments to which the
Company is a party and under which its employees are entitled to receive
benefits of any nature. There is no pending or threatened (i) labor dispute or
union organization campaign relating to the Company, (ii) claims against the
Company by any employees of the Company (other than those certain Workers'
Compensation claims specifically described on Schedule 3.13), or (iii)
terminations, resignations or retirements of any employees of the Company. None
of the employees of the Company are represented by any labor union or
organization. There is no unfair labor practice claim against the Company before
the National Labor Relations Board or any strike, labor dispute, work slowdown,
or work stoppage pending or threatened against or involving the Company.
3.16 Business Relations. The Company has no reason to believe and has
not been notified that any supplier or customer of the Company will cease or
refuse to do business with the Company in the same manner as previously
conducted with the Company as a result of or within one (1) year after the
consummation of the transactions contemplated hereby, to the extent such
cessation or refusal might affect the Business. The Company has not received any
notice of any disruption (including delayed deliveries or allocations by
suppliers) in the availability of the materials or products used by the Company.
3.17 Working Capital. Except as set forth on Schedule 3.17 attached
hereto, all of the accounts, notes, and loans receivable (the "Accounts
Receivable") reflected in the Financial Statements, or arising since June 30,
1999, arose from transactions occurring in the ordinary course of the Company's
business as previously conducted, are bona fide and represent amounts validly
due, subject to offsets or defenses. Except for accounts payable and other
accrued expenses incurred in the ordinary course of the Company's business since
June 30, 1999 and consistent with past practices of the Company, there are no
liabilities of the Company other than those reflected in the Financial
Statements. Adequate provision has been made for uncollectible Accounts
Receivable. Since June 30, 1999, the Company has collected its Accounts
Receivable and has paid or performed all liabilities and obligations of the
Company in the ordinary course, consistent with past practices. The Working
Capital (as hereinafter defined) of the Company existing on the Closing Date is
equal to or greater than $100,000.
3.18 Agents. Except as set forth on Schedule 3.18 attached hereto, the
Company has not designated or appointed any person (other than the Company's
employees and officers) or other entity to act for it or on its behalf pursuant
to any power of attorney or any agency which is presently in effect.
3.19 Indebtedness To and From Directors, Officers, Shareholders and
Employees. The Company does not owe any indebtedness to any of its directors,
officers, shareholders, employees or affiliates, or have indebtedness owed to it
from any of its directors, officers, shareholders, employees or affiliates,
excluding indebtedness for travel advances or similar advances for expenses
incurred on behalf of and in the ordinary course of business of the Company and
consistent with the Company's past practices. As of the Effective Time and the
Closing Date all amounts due the Company from any of its directors, officers,
employees or affiliates (or any of their family members) shall have been repaid
in full.
3.20 Commission Sales Contracts. Except as disclosed in Schedule 3.20
attached hereto, the Company does not employ or have any relationship with any
individual, corporation, partnership, or other entity whose compensation from
the Company is in whole or in part determined on a commission basis.
3.21 Certain Consents. Except as set forth on Schedule 3.21 attached
hereto, there are no consents, waivers, or approvals required to be executed
and/or obtained by the Company from third parties in connection with the
execution, delivery, and performance of this Agreement or any of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement (all of which are collectively
referred to as the "Transaction Documents").
3.22 Brokers. The Company has not engaged, or caused any liability to
be incurred to, any finder, broker, or sales agent (and has not paid, and will
not pay, any finders fee or similar fee or commission to any person) in
connection with the execution, delivery, or performance of this Agreement or the
transactions contemplated hereby.
3.23 Interest in Competitors, Suppliers, and Customers. Except as set
forth on Schedule 3.23 attached hereto, neither the Company nor any affiliate of
the Company, and to the knowledge of the Company and Seller, no director,
officer, employee or affiliate of the Company or any affiliate of any director,
officer, employee or affiliate of the Company, has any ownership interest in any
competitor, customer or supplier of the Company or any property used in the
operation of the Business.
3.24 Warranties. Except as set forth on Schedule 3.24, the Company has
not made any warranties or guarantees to third parties with respect to any
products sold or services rendered by it. Except as set forth on Schedule 3.24
attached hereto, no claims for breach of product or service warranties have been
made against the Company since January 1, 1996.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to which it is a
party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel for Seller may
reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit B;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit C, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit D, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
the Company, not specifically and fully reflected by item and amount on either
Schedule 3.4 or in the Financial Statements, that is or may be asserted with
respect to any acts or omissions occurring, or circumstances existing, on or
prior to the Closing Date, except for liabilities incurred in the ordinary
course of business, or (iii) any obligations or liabilities with respect to any
claims arising out of actions or omissions, that occurred prior to the Closing
Date, by any of the Company's directors, officers, shareholders, agents,
employees, representatives, subsidiaries and/or affiliates.
(b) Seller agrees to indemnify and hold harmless each of the
Prime Indemnified Parties from and against any and all Indemnified Costs in
connection with the commencement or assertion of any third-party action which
any of the Prime Indemnified Parties may sustain, arising out of any breach or
default by Seller of any of its representations, warranties, covenants or
agreements contained in this Agreement or any Transaction Document.
(c) Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 6.1
unless and until such time as all claims of all Prime Indemnified Parties, taken
together, exceed $10,000 in the aggregate, at which time all claims of such
Prime Indemnified Parties may be asserted individually or in combination
(beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1 shall be limited to the aggregate Purchase Price received by Seller
under this Agreement, plus the greater of (a) the value of all remaining equity
interests which Seller holds in the Company at the time of Closing or (b) the
value of all remaining equity interests which Seller holds in the Company at the
time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party shall be
entitled to assert any claim for indemnification under this Section 7.1 unless
and until such time as all claims of such Seller Indemnified Party, individually
and not in combination with other Seller Indemnified Parties, exceed $25,000 in
the aggregate, at which time all claims of such Seller Indemnified Party may be
asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), (iii)
relocation of Seller's primary residence outside of a two hundred (200) mile
radius of the center or facility at which Seller primarily renders services, or
(iv) if Seller is a physician or other practicing licensed professional, the
performance by Seller, during any one-month period, of greater than thirty (30%)
of his or her professional medical activities outside of a two hundred (200)
mile radius of the center or facility primarily utilized by Seller prior to the
date of this Agreement; the Seller's executor, administrator, trustee,
custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or relocation of primary residence or practice, as the case may be, within which
time it may require that the Company purchase (subject to the remaining
provisions of this subsection) all of Seller's capital stock of the Company,
upon the terms and conditions hereinafter set forth, by giving notice of such
election in writing to the Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. Without in any way limiting or
qualifying the representation and warranty with respect to Working Capital
contained in Section 3.17, all parties to this Agreement acknowledge and agree
that no shareholder of the Company, or any other party, has any obligation
existing on the Closing Date to make a capital contribution to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH
CERTAIN CONDITIONS SPECIFIED IN A CERTAIN STOCK PURCHASE
AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1, 1999, A COMPLETE
AND CORRECT COPY OF WHICH IS AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED TO THE
HOLDER HEREOF UPON WRITTEN REQUEST AND WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Invalid Provisions. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable under present or future laws, such
provision shall be fully severable, this Agreement shall be construed as if such
illegal, invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxx Xxxxxx Xxxxxxx, M.D., Trustee
Family Revocable Trust
dated February 8, 1991
0000 Xxxx Xxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by proper
notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless of
any investigation at any time made by or on behalf of any party hereto or of any
information any party may have in respect thereof, all covenants, agreements,
representations, and warranties made hereunder or pursuant hereto or in
connection with the transactions contemplated hereby shall survive the Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of the officers of the Company
holding office immediately prior to the Closing, and any employee of the Company
who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title: Vice President
Seller: /s/ Xxxx Xxxxxx Xxxxxxx, M.D., Trustee
Printed Name: Xxxx Xxxxxx Xxxxxxx, M.D., Trustee under
the Xxxx Xxxxxx Xxxxxxx, M.D. Family
Revocable Trust dated February 1, 1991
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Financial Statements
EXHIBIT B: Form of Exclusive Use Agreement
EXHIBIT C: Form of Assignment and Security Agreement
EXHIBIT D: Form of Amended and Restated Bylaws of Seller
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxx X. Xxxxxx,
M.D., Trustee under Trust Agreement dated April 12, 1989, and a shareholder of
the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time,
79,914 authorized and issued shares of the Company's $0.01 par value common
stock presently owned by Seller and evidenced by stock certificate number X-00,
X-00, X-00, X-00 and C-95 (collectively, the "Capital Stock"). The purchase
price for the Capital Stock shall be $906,453.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of the Company and Seller
Seller and the Company hereby represent and warrant to Prime, jointly
and severally, that each of the following matters is true and correct in all
respects as of the Closing Date (with the understanding that Prime is relying
materially on each such representation and warranty in entering into and
performing this Agreement), which representations and warranties shall also be
deemed made as of the Effective Time and which shall survive the Closing;
provided, however, that all representations and warranties made by Seller
hereunder shall be deemed made by Seller only to the actual knowledge of Seller.
3.1 Due Organization. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada and
has full power and authority to carry on its business as now conducted and as
proposed to be conducted. The Company is qualified to do business and is in good
standing in the states set forth on Schedule 3.1(a) attached hereto, which
states represent every jurisdiction where such qualification is required for the
conduct of the Company's business as conducted on the Closing Date. Complete and
correct copies of the Company's Articles of Incorporation, Bylaws, all board of
directors' resolutions, all shareholders' resolutions, and all amendments
thereto, have been delivered to Prime. Schedule 3.1(b) sets forth a true and
complete list, as of the Closing Date, of all of the holders of any equity or
other ownership interest in the Company or of any right to obtain, by conversion
or otherwise, and regardless of whether presently exercisable, any equity or
other ownership interest in the Company; in each case showing the number and
type of interest or right held. Schedule 3.1(b) also identifies each of the
persons listed therein that is a physician or other licensed medical
professional, and describes each such person's license(s) and professional
title. Except as set forth on Schedule 3.1(b), immediately prior to the Closing
Date there are outstanding (i) no shares of equity or other voting securities of
the Company, (ii) no securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) no options
or other rights to acquire from the Company or Seller, and no obligation of the
Company or Seller to issue or sell, any equity or other voting securities of the
Company or any securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) no equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company. Immediately following
the Closing of this transaction and the closings of the Related Acquisitions (as
hereinafter defined), Prime will own sixty percent (60%) of all of the voting
equity securities of the Company (after assuming the conversion, exchange or
exercise of any and all securities or rights convertible into, or exchangeable
or exercisable for, voting equity securities of the Company), and all of those
persons and entities listed on Schedule 3.1(b) will own, in the aggregate, forty
percent (40%) of all of the voting equity securities of the Company (after
assuming the conversion, exchange or exercise of any and all securities or
rights convertible into, or exchangeable or exercisable for, voting equity
securities of the Company). The Capital Stock transferred by Seller to Prime at
the Closing, as well as all other capital stock of the Company transferred to
Prime in the Related Acquisitions, will be duly authorized, validly issued and
outstanding, fully paid, non-assessable, and free of any liens, claims or
encumbrances whatsoever.
3.2 Subsidiaries. Except as set forth on Schedule 3.2 (reflecting
ownership interests and the nature of such interests), the Company does not
directly or indirectly have (or possess any options or other rights to acquire)
any subsidiaries or any direct or indirect ownership interests in any person,
business, corporation, partnership, limited liability company, association,
joint venture, trust, or other entity.
3.3 Due Authorization. Each of the Company and Seller has full power
and authority to enter into and perform this Agreement and each Transaction
Document required to be executed by the Company or Seller in connection
herewith. The execution, delivery, and performance of this Agreement and each
such Transaction Document has been duly authorized by all necessary action of
the Company, its directors, its officers and its shareholders. This Agreement
and each such Transaction Document has been duly and validly executed and
delivered by the Company and Seller and constitutes a valid and binding
obligation of the Company and Seller, enforceable against each of them in
accordance with its terms. The execution, delivery, and performance of this
Agreement, and each Transaction Document required herein to be executed by
Seller and/or the Company do not (a) violate any federal, state, county, or
local law, rule, or regulation applicable to the Company, the Business (as
hereinafter defined), the Company's assets or the Capital Stock, (b) violate or
conflict with, or permit the cancellation of, any agreement to which the Company
is a party, or by which the Company or its properties are bound, or result in
the creation of any lien, security interest, charge, or encumbrance upon any of
such properties or the upon the Capital Stock, (c) permit the acceleration of
the maturity of any indebtedness of Seller or the Company, or any indebtedness
secured by the Capital Stock or by the property of the Company, or (d) violate
or conflict with any provision of the organizational documents of the Company.
No action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller or the Company in
connection with the execution, delivery, or performance of this Agreement (or
any Transaction Document).
3.4 Financial Statements. The unaudited balance sheet and income
statement of the Company as of and for each of the years ended March 31, 1998
and 1999, and the unaudited balance sheet and income statement of the Company as
of and for the three (3) months ended June 30, 1999 (collectively, the
"Financial Statements") are attached hereto as Exhibit A. The Financial
Statements have been prepared in accordance with generally accepted accounting
principles consistently applied ("GAAP") (except as specifically noted therein
or in Schedule 3.4) and fairly present the financial position and results of
operations of the Company as of the indicated dates and for the indicated
periods. Except for liabilities incurred in the ordinary course of business or
disclosed in Schedule 3.4, and except to the extent specifically and fully
reflected in the Financial Statements (including the notes thereto), as of the
Closing Date, the Company has no claims, debts, liabilities, or obligations,
whether known or unknown, absolute, contingent or otherwise (including, but not
limited to, federal, state, and local taxes, any sales taxes, use taxes and
property taxes, any taxes arising from the transactions contemplated by this
Agreement and any liabilities arising from any litigation or civil, criminal or
regulatory proceeding involving or related to the Company, its assets or the
Business). The Company and Seller each agree to indemnify and hold harmless
Prime and its affiliates from and against any and all such claims, debts,
liabilities and obligations. Except as set forth in Schedule 3.4 hereto, since
June 30, 1999 there has been no material adverse change in the assets of the
Company, the Business, or the results of operations or financial position of the
Company.
3.5 Conduct of Business; Certain Actions. As used herein, "Business"
means all of the business conducted by the Company, which shall be deemed to
include all refractive surgery modalities, now performed, offered or made
available, including, without limitation, implantable contact lenses, instromal
corneal rings, laser in situs keratomileusis photorefractive keratectomy,
automated lemellar keratoplasty, radial keratotomy, astigmatic keratotomy and
similar procedures. Except as set forth on Schedule 3.5 attached hereto, since
June 30, 1999, the Company has conducted its Business and operations of the
Business in the ordinary course and consistent with its past practices and has
not (a) purchased or retired any indebtedness, or purchased, retired, or
redeemed any ownership interest from, any director, officer, shareholder,
employee or affiliate of the Company, or engaged in any other transaction that
involves or requires distributions of money or other assets from the Company to
any director, officer, shareholder, employee or affiliate of the Company if such
other transaction is not done in the ordinary course of business and is not
consistent with past practices of the Company, (b) increased the compensation of
any directors, officers, employees, agents, contractors, vendors or other
parties, except for wage and salary increases made in the ordinary course of
business and consistent with the past practices of the Company, (c) made capital
expenditures exceeding $10,000 individually or $25,000 in the aggregate, (d)
sold any asset (or any group of related assets) in any transaction (or series of
related transactions) in which the purchase price or book value for such asset
(or group of related assets) exceeded $10,000, (e) discharged or satisfied any
lien or encumbrance or paid any obligation or liability, absolute or contingent,
other than current liabilities incurred and paid in the ordinary course of
business, (f) made or guaranteed any loans or advances to any party whatsoever,
(g) suffered or permitted any lien, security interest, claim, charge, or other
encumbrance to arise or be granted or created against or upon any of its assets,
real or personal, tangible or intangible, (h) canceled, waived, or released any
of its debts, rights, or claims against third parties, (i) amended its
organizational documents, (j) made or paid any severance or termination payment
to any director, officer, employee, agent, contractor, vendor or consultant, (k)
made any change in its method of accounting, (l) made any investment or
commitment therefor in any person, business, corporation, association,
partnership, limited liability company, joint venture, trust, or other entity,
(m) made, entered into, amended, or terminated any written employment contract,
created, made, amended, or terminated any bonus, stock option, pension,
retirement, profit sharing, or other employee benefit plan or arrangement, or
withdrawn from any "multi-employer plan" (as defined in the Internal Revenue
Code of 1986, as amended (the "Code")) so as to create any liability under ERISA
(as hereinafter defined) to any person or entity, (n) amended, terminated or
experienced a termination of any material contract, agreement, lease, franchise,
or license to which it is a party, (o) made any distributions, in cash or in
kind, to its shareholders, or to any person or entity related to or affiliated
therewith, in any capacity, except such distributions as are made in the
ordinary course of the Company's business consistent with past practices, (p)
entered into any other material transactions except in the ordinary course of
business, (q) entered into any contract, commitment, agreement, or understanding
to do any acts described in the foregoing clauses (a)-(p) of this Section, (r)
suffered any material damage, destruction, or loss (whether or not covered by
insurance) to any assets, (s) experienced any strike, slowdown, or demand for
recognition by a labor organization by or with respect to any of its employees,
or (t) experienced or effected any shutdown, slow-down, or cessation of any
operations conducted by, or constituting part of, it.
3.6 Assets; Licenses, Permits, etc. Except as set forth on Schedule
3.6(a), the Company has good and marketable title to all of its assets, free and
clear of all liens, security interests, claims, rights of another, and
encumbrances of any kind whatsoever. The assets of the Company are in good
operating condition and repair, subject to ordinary wear and tear, taking into
account the respective ages of the properties involved and are all that are
necessary for the conduct of the Business. Attached hereto as Schedule 3.6(b) is
a list and description of all federal, state, county, and local governmental
licenses, certificates, certificates of need, permits, waivers, filings and
orders held or applied for by the Company and used or relied on (or to be used
or relied on) in connection with the Business ("Permits"). The Company has
complied in all material respects, and the Company is in compliance in all
material respects, with the terms and conditions of any such Permits. No
additional Permit is required from any federal, state, county, or local
governmental agency or body thereof in connection with the conduct of the
Business. No claim has been made by any governmental authority (and, to the
knowledge of Seller and the Company, no such claim has been threatened) to the
effect that a Permit not possessed by the Company is necessary in respect of the
Business.
3.7 Environmental Issues.
(a) For purposes of this Agreement, the term "environmental
laws" shall mean all laws and regulations relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling, or the emission, discharge, or release, of any pollutant, contaminant,
chemical, or industrial toxic or hazardous substance or waste, and any order
related thereto.
(b) The Company has complied in all material respects with and
obtained all authorizations and made all filings required by all applicable
environmental laws. The properties occupied or used by the Company have not been
contaminated with any hazardous wastes, hazardous substances, or other hazardous
or toxic materials in violation of any applicable environmental law, the
violation of which could have a material adverse impact on the Business or the
financial position of the Company.
(c) The Company has not received any notice from the United
States Environmental Protection Agency that it is a potentially responsible
party under the Comprehensive Environmental Response, Compensation and Liability
Act ("Superfund Notice"), any citation from any federal, state or local
governmental authority for non-compliance with its requirements with respect to
air, water or environmental pollution, or the improper storage, use or discharge
of any hazardous waste, other waste or other substance or other material
pertaining to its business ("Citations") or any written notice from any private
party alleging any such non-compliance; and there are no pending or unresolved
Superfund Notices, Citations or written notices from private parties alleging
any such non-compliance.
3.8 Intellectual Property Rights. There are no patents, trademarks,
trade names, or copyrights, and no applications therefor, owned by or registered
in the name of the Company or in which the Company has any right, license, or
interest. The Company is not a party to any license agreement, either as
licensor or licensee, with respect to any patents, trademarks, trade names, or
copyrights. The Company has not received any notice that it is infringing any
patent, trademark, trade name, or copyright of others.
3.9 Compliance with Laws. To the knowledge of the Company and Seller,
the Company has complied in all material respects, and the Company is in
compliance in all material respects, with all federal, state, county, and local
laws, rules, regulations and ordinances currently in effect. No claim has been
made or threatened by any governmental authority against the Company to the
effect that the business conducted by the Company fails to comply in any respect
with any law, rule, regulation, or ordinance.
3.10 Insurance. Attached hereto as Schedule 3.10 is a list of all
policies of fire, liability, business interruption, and other forms of insurance
(including, without limitation, professional liability insurance) and all
fidelity bonds held by or applicable to the Company at any time within the past
three (3) years, which schedule sets forth in respect of each such policy the
policy name, policy number, carrier, term, type of coverage, deductible amount
or self-insured retention amount, limits of coverage, and annual premium. To the
knowledge of the Company and Seller, no event directly relating to the Company
has occurred which will result in a retroactive upward adjustment of premiums
under any such policies or which is likely to result in any prospective upward
adjustment in such premiums. There have been no material changes in the type of
insurance coverage maintained by the Company during the past three (3) years,
including without limitation any change which has resulted in any period during
which the Company had no insurance coverage. Excluding insurance policies which
have expired and been replaced, no insurance policy of the Company has been
canceled within the last three (3) years and no threat has been made to cancel
any insurance policy of the Company within such period.
3.11 Employee Benefit Matters. Except as set forth on Schedule 3.11,
the Company does not maintain nor does it contribute nor is it required to
contribute to any "employee welfare benefit plan" (as defined in section 3(1) of
the Employee Retirement Income Security Act of 1974 (and any sections of the
Code amended by it) and all regulations promulgated thereunder, as the same have
from time to time been amended ("ERISA")) or any "employee pension benefit plan"
(as defined in ERISA). The Company does not presently maintain and has never
maintained, or had any obligation of any nature to contribute to, a "defined
benefit plan" within the meaning of the Code.
3.12 Contracts and Agreements. Attached hereto as Schedule 3.12 is a
list of all written or oral contracts, commitments, leases, and other agreements
(including, without limitation, all promissory notes, loan agreements, and other
evidences of indebtedness, mortgages, deeds of trust, security agreements,
pledge agreements, service agreements, and similar agreements and instruments
and all confidentiality agreements) to which the Company is a party or by which
the Company or its properties are bound, pursuant to which the obligations
thereunder of any party thereto are, or are contemplated as being, in respect of
any such individual contracts, commitments, leases, or other agreements during
any year during the term thereof, $25,000 or greater, or which are otherwise
material to the Business (collectively the "Contracts" and individually, a
"Contract"). The Company is not and, to the best knowledge of the Company and
Seller, no other party thereto is in default (and no event has occurred which,
with the passage of time or the giving of notice, or both, would constitute a
default by the Company or, to the best knowledge of the Company and Seller, by
any other party thereto) under any Contract. The Company has not waived any
material right under any Contract, and no consents or approvals (other than
those obtained in writing and delivered to Prime prior to Closing) are required
under any Contract in connection with the sale of Capital Stock or the
consummation of the transactions contemplated hereby. The Company has not
guaranteed any obligation of any other person or entity.
3.13 Claims and Proceedings. Attached hereto as Schedule 3.13 is a list
and description of all claims, actions, suits, proceedings, and investigations
pending or, to the knowledge of the Company and Seller, threatened against the
Company, at law or in equity, or before or by any court, municipal or other
governmental department, commission, board, agency, or instrumentality. Except
as set forth on Schedule 3.13 attached hereto, none of such claims, actions,
suits, proceedings, or investigations will result in any liability or loss to
the Company which (individually or in the aggregate) is material, and the
Company has not been, and the Company is not now, subject to any order,
judgment, decree, stipulation, or consent of any court, governmental body, or
agency. No inquiry, action, or proceeding has been asserted, instituted, or
threatened against the Company or Seller to restrain or prohibit the carrying
out of the transactions contemplated by this Agreement or to challenge the
validity of such transactions or any part thereof or seeking damages on account
thereof.
3.14 Taxes. All federal, foreign, state, county, and local income,
gross receipts, excise, property, franchise, license, sales, use, withholding,
and other tax (collectively, "Taxes") returns, reports, and declarations of
estimated tax (collectively, "Returns") which were required to be filed by the
company on or before the date hereof have been filed within the time (including
any applicable extensions) and in the manner provided by law, and all such
Returns are true and correct in all material respects and accurately reflect the
Tax liabilities of the Company. The Company has provided Prime with copies of
all returns filed for and during the years ended 1998, 1997 and (to the extent
an extension was filed for any return for the year ended 1998) 1996. All Taxes,
assessments, penalties, and interest which have become due pursuant to such
Returns have been paid or adequately accrued in the Financial Statements. The
provisions for Taxes reflected on the balance sheet contained in the Financial
Statements are adequate to cover all of the Company's estimated Tax liabilities
for the respective periods then ended and all prior periods. As of the Closing
Date, the Company will not owe any Taxes for any period prior to the Closing
which are not reflected on the Financial Statements, except for Taxes
attributable to the operations of the Company between June 30, 1999 and the
Closing Date. The Company has not executed any presently effective waiver or
extension of any statute of limitations against assessments and collection of
Taxes. There are no pending or threatened claims, assessments, notices,
proposals to assess, deficiencies, or audits (collectively, "Tax Actions")
against the Company with respect to any Taxes owed or allegedly owed by the
Company. There are no tax liens on any of the assets of the Company. Proper and
accurate amounts have been withheld and remitted by the Company from and in
respect of all persons from whom it is required by applicable law to withhold
for all periods in compliance with the tax withholding provisions of all
applicable laws and regulations. The Company is not a party to any tax sharing
agreement.
3.15 Personnel. Attached hereto as Schedule 3.15 is a list of names and
current annual rates of compensation of the officers, employees or agents of the
Company who are necessary for the operation of the Business (the "Employees").
Except as set forth on Schedule 3.15, there are no bonus, profit sharing,
percentage compensation, company automobile, club membership, and other like
benefits, if any, paid or payable by the Company to any Employees from December
31, 1998 through the Closing Date. Schedule 3.15 attached hereto also contains a
brief description of all material terms of employment agreements and
confidentiality agreements to which the Company is a party and all severance
benefits which any director, officer, Employee or sales representative of the
Company is or may be entitled to receive. The Company has delivered to Prime
accurate and complete copies of all such employment agreements, confidentiality
agreements, and all other agreements, plans, and other instruments to which the
Company is a party and under which its employees are entitled to receive
benefits of any nature. There is no pending or threatened (i) labor dispute or
union organization campaign relating to the Company, (ii) claims against the
Company by any employees of the Company (other than those certain Workers'
Compensation claims specifically described on Schedule 3.13), or (iii)
terminations, resignations or retirements of any employees of the Company. None
of the employees of the Company are represented by any labor union or
organization. There is no unfair labor practice claim against the Company before
the National Labor Relations Board or any strike, labor dispute, work slowdown,
or work stoppage pending or threatened against or involving the Company.
3.16 Business Relations. The Company has no reason to believe and has
not been notified that any supplier or customer of the Company will cease or
refuse to do business with the Company in the same manner as previously
conducted with the Company as a result of or within one (1) year after the
consummation of the transactions contemplated hereby, to the extent such
cessation or refusal might affect the Business. The Company has not received any
notice of any disruption (including delayed deliveries or allocations by
suppliers) in the availability of the materials or products used by the Company.
3.17 Working Capital. Except as set forth on Schedule 3.17 attached
hereto, all of the accounts, notes, and loans receivable (the "Accounts
Receivable") reflected in the Financial Statements, or arising since June 30,
1999, arose from transactions occurring in the ordinary course of the Company's
business as previously conducted, are bona fide and represent amounts validly
due, subject to offsets or defenses. Except for accounts payable and other
accrued expenses incurred in the ordinary course of the Company's business since
June 30, 1999 and consistent with past practices of the Company, there are no
liabilities of the Company other than those reflected in the Financial
Statements. Adequate provision has been made for uncollectible Accounts
Receivable. Since June 30, 1999, the Company has collected its Accounts
Receivable and has paid or performed all liabilities and obligations of the
Company in the ordinary course, consistent with past practices. The Working
Capital (as hereinafter defined) of the Company existing on the Closing Date is
equal to or greater than $100,000.
3.18 Agents. Except as set forth on Schedule 3.18 attached hereto, the
Company has not designated or appointed any person (other than the Company's
employees and officers) or other entity to act for it or on its behalf pursuant
to any power of attorney or any agency which is presently in effect.
3.19 Indebtedness To and From Directors, Officers, Shareholders and
Employees. The Company does not owe any indebtedness to any of its directors,
officers, shareholders, employees or affiliates, or have indebtedness owed to it
from any of its directors, officers, shareholders, employees or affiliates,
excluding indebtedness for travel advances or similar advances for expenses
incurred on behalf of and in the ordinary course of business of the Company and
consistent with the Company's past practices. As of the Effective Time and the
Closing Date all amounts due the Company from any of its directors, officers,
employees or affiliates (or any of their family members) shall have been repaid
in full.
3.20 Commission Sales Contracts. Except as disclosed in Schedule 3.20
attached hereto, the Company does not employ or have any relationship with any
individual, corporation, partnership, or other entity whose compensation from
the Company is in whole or in part determined on a commission basis.
3.21 Certain Consents. Except as set forth on Schedule 3.21 attached
hereto, there are no consents, waivers, or approvals required to be executed
and/or obtained by the Company from third parties in connection with the
execution, delivery, and performance of this Agreement or any of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement (all of which are collectively
referred to as the "Transaction Documents").
3.22 Brokers. The Company has not engaged, or caused any liability to
be incurred to, any finder, broker, or sales agent (and has not paid, and will
not pay, any finders fee or similar fee or commission to any person) in
connection with the execution, delivery, or performance of this Agreement or the
transactions contemplated hereby.
3.23 Interest in Competitors, Suppliers, and Customers. Except as set
forth on Schedule 3.23 attached hereto, neither the Company nor any affiliate of
the Company, and to the knowledge of the Company and Seller, no director,
officer, employee or affiliate of the Company or any affiliate of any director,
officer, employee or affiliate of the Company, has any ownership interest in any
competitor, customer or supplier of the Company or any property used in the
operation of the Business.
3.24 Warranties. Except as set forth on Schedule 3.24, the Company has
not made any warranties or guarantees to third parties with respect to any
products sold or services rendered by it. Except as set forth on Schedule 3.24
attached hereto, no claims for breach of product or service warranties have been
made against the Company since January 1, 1996.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to which it is a
party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel for Seller may
reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit B;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit C, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit D, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
the Company, not specifically and fully reflected by item and amount on either
Schedule 3.4 or in the Financial Statements, that is or may be asserted with
respect to any acts or omissions occurring, or circumstances existing, on or
prior to the Closing Date, except for liabilities incurred in the ordinary
course of business, or (iii) any obligations or liabilities with respect to any
claims arising out of actions or omissions, that occurred prior to the Closing
Date, by any of the Company's directors, officers, shareholders, agents,
employees, representatives, subsidiaries and/or affiliates.
(b) Seller agrees to indemnify and hold harmless each of the
Prime Indemnified Parties from and against any and all Indemnified Costs in
connection with the commencement or assertion of any third-party action which
any of the Prime Indemnified Parties may sustain, arising out of any breach or
default by Seller of any of its representations, warranties, covenants or
agreements contained in this Agreement or any Transaction Document.
(c) Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 6.1
unless and until such time as all claims of all Prime Indemnified Parties, taken
together, exceed $10,000 in the aggregate, at which time all claims of such
Prime Indemnified Parties may be asserted individually or in combination
(beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1 shall be limited to the aggregate Purchase Price received by Seller
under this Agreement, plus the greater of (a) the value of all remaining equity
interests which Seller holds in the Company at the time of Closing or (b) the
value of all remaining equity interests which Seller holds in the Company at the
time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party shall be
entitled to assert any claim for indemnification under this Section 7.1 unless
and until such time as all claims of such Seller Indemnified Party, individually
and not in combination with other Seller Indemnified Parties, exceed $25,000 in
the aggregate, at which time all claims of such Seller Indemnified Party may be
asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), (iii)
relocation of Seller's primary residence outside of a two hundred (200) mile
radius of the center or facility at which Seller primarily renders services, or
(iv) if Seller is a physician or other practicing licensed professional, the
performance by Seller, during any one-month period, of greater than thirty (30%)
of his or her professional medical activities outside of a two hundred (200)
mile radius of the center or facility primarily utilized by Seller prior to the
date of this Agreement; the Seller's executor, administrator, trustee,
custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or relocation of primary residence or practice, as the case may be, within which
time it may require that the Company purchase (subject to the remaining
provisions of this subsection) all of Seller's capital stock of the Company,
upon the terms and conditions hereinafter set forth, by giving notice of such
election in writing to the Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. Without in any way limiting or
qualifying the representation and warranty with respect to Working Capital
contained in Section 3.17, all parties to this Agreement acknowledge and agree
that no shareholder of the Company, or any other party, has any obligation
existing on the Closing Date to make a capital contribution to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH
CERTAIN CONDITIONS SPECIFIED IN A CERTAIN STOCK PURCHASE
AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1, 1999, A COMPLETE
AND CORRECT COPY OF WHICH IS AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED TO THE
HOLDER HEREOF UPON WRITTEN REQUEST AND WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Invalid Provisions. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable under present or future laws, such
provision shall be fully severable, this Agreement shall be construed as if such
illegal, invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxx X. Xxxxxx, M.D., Trustee
under Trust Agreement
dated April 12, 1989
000 Xxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by proper
notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless of
any investigation at any time made by or on behalf of any party hereto or of any
information any party may have in respect thereof, all covenants, agreements,
representations, and warranties made hereunder or pursuant hereto or in
connection with the transactions contemplated hereby shall survive the Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of the officers of the Company
holding office immediately prior to the Closing, and any employee of the Company
who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title: Vice President
Seller: /s/ Xxxx X. Xxxxxx, M.D.
Printed Name: Xxxx X. Xxxxxx, M.D.
Trustee under Trust Agreement
dated April 12, 1989
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Financial Statements
EXHIBIT B: Form of Exclusive Use Agreement
EXHIBIT C: Form of Assignment and Security Agreement
EXHIBIT D: Form of Amended and Restated Bylaws of Seller
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Xxxxxxx X.
Xxxxxxx, M.D. an individual residing in Suisun City, California and a
shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time,
44,780 authorized and issued shares of the Company's $0.01 par value common
stock presently owned by Seller and evidenced by stock certificate number C-97
(collectively, the "Capital Stock"). The purchase price for the Capital Stock
shall be $507,933.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of the Company and Seller
Seller and the Company hereby represent and warrant to Prime, jointly
and severally, that each of the following matters is true and correct in all
respects as of the Closing Date (with the understanding that Prime is relying
materially on each such representation and warranty in entering into and
performing this Agreement), which representations and warranties shall also be
deemed made as of the Effective Time and which shall survive the Closing;
provided, however, that all representations and warranties made by Seller
hereunder shall be deemed made by Seller only to the actual knowledge of Seller.
3.1 Due Organization. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada and
has full power and authority to carry on its business as now conducted and as
proposed to be conducted. The Company is qualified to do business and is in good
standing in the states set forth on Schedule 3.1(a) attached hereto, which
states represent every jurisdiction where such qualification is required for the
conduct of the Company's business as conducted on the Closing Date. Complete and
correct copies of the Company's Articles of Incorporation, Bylaws, all board of
directors' resolutions, all shareholders' resolutions, and all amendments
thereto, have been delivered to Prime. Schedule 3.1(b) sets forth a true and
complete list, as of the Closing Date, of all of the holders of any equity or
other ownership interest in the Company or of any right to obtain, by conversion
or otherwise, and regardless of whether presently exercisable, any equity or
other ownership interest in the Company; in each case showing the number and
type of interest or right held. Schedule 3.1(b) also identifies each of the
persons listed therein that is a physician or other licensed medical
professional, and describes each such person's license(s) and professional
title. Except as set forth on Schedule 3.1(b), immediately prior to the Closing
Date there are outstanding (i) no shares of equity or other voting securities of
the Company, (ii) no securities of the Company convertible into or exchangeable
for shares of equity or other voting securities of the Company, (iii) no options
or other rights to acquire from the Company or Seller, and no obligation of the
Company or Seller to issue or sell, any equity or other voting securities of the
Company or any securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) no equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company. Immediately following
the Closing of this transaction and the closings of the Related Acquisitions (as
hereinafter defined), Prime will own sixty percent (60%) of all of the voting
equity securities of the Company (after assuming the conversion, exchange or
exercise of any and all securities or rights convertible into, or exchangeable
or exercisable for, voting equity securities of the Company), and all of those
persons and entities listed on Schedule 3.1(b) will own, in the aggregate, forty
percent (40%) of all of the voting equity securities of the Company (after
assuming the conversion, exchange or exercise of any and all securities or
rights convertible into, or exchangeable or exercisable for, voting equity
securities of the Company). The Capital Stock transferred by Seller to Prime at
the Closing, as well as all other capital stock of the Company transferred to
Prime in the Related Acquisitions, will be duly authorized, validly issued and
outstanding, fully paid, non-assessable, and free of any liens, claims or
encumbrances whatsoever.
3.2 Subsidiaries. Except as set forth on Schedule 3.2 (reflecting
ownership interests and the nature of such interests), the Company does not
directly or indirectly have (or possess any options or other rights to acquire)
any subsidiaries or any direct or indirect ownership interests in any person,
business, corporation, partnership, limited liability company, association,
joint venture, trust, or other entity.
3.3 Due Authorization. Each of the Company and Seller has full power
and authority to enter into and perform this Agreement and each Transaction
Document required to be executed by the Company or Seller in connection
herewith. The execution, delivery, and performance of this Agreement and each
such Transaction Document has been duly authorized by all necessary action of
the Company, its directors, its officers and its shareholders. This Agreement
and each such Transaction Document has been duly and validly executed and
delivered by the Company and Seller and constitutes a valid and binding
obligation of the Company and Seller, enforceable against each of them in
accordance with its terms. The execution, delivery, and performance of this
Agreement, and each Transaction Document required herein to be executed by
Seller and/or the Company do not (a) violate any federal, state, county, or
local law, rule, or regulation applicable to the Company, the Business (as
hereinafter defined), the Company's assets or the Capital Stock, (b) violate or
conflict with, or permit the cancellation of, any agreement to which the Company
is a party, or by which the Company or its properties are bound, or result in
the creation of any lien, security interest, charge, or encumbrance upon any of
such properties or the upon the Capital Stock, (c) permit the acceleration of
the maturity of any indebtedness of Seller or the Company, or any indebtedness
secured by the Capital Stock or by the property of the Company, or (d) violate
or conflict with any provision of the organizational documents of the Company.
No action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller or the Company in
connection with the execution, delivery, or performance of this Agreement (or
any Transaction Document).
3.4 Financial Statements. The unaudited balance sheet and income
statement of the Company as of and for each of the years ended March 31, 1998
and 1999, and the unaudited balance sheet and income statement of the Company as
of and for the three (3) months ended June 30, 1999 (collectively, the
"Financial Statements") are attached hereto as Exhibit A. The Financial
Statements have been prepared in accordance with generally accepted accounting
principles consistently applied ("GAAP") (except as specifically noted therein
or in Schedule 3.4) and fairly present the financial position and results of
operations of the Company as of the indicated dates and for the indicated
periods. Except for liabilities incurred in the ordinary course of business or
disclosed in Schedule 3.4, and except to the extent specifically and fully
reflected in the Financial Statements (including the notes thereto), as of the
Closing Date, the Company has no claims, debts, liabilities, or obligations,
whether known or unknown, absolute, contingent or otherwise (including, but not
limited to, federal, state, and local taxes, any sales taxes, use taxes and
property taxes, any taxes arising from the transactions contemplated by this
Agreement and any liabilities arising from any litigation or civil, criminal or
regulatory proceeding involving or related to the Company, its assets or the
Business). The Company and Seller each agree to indemnify and hold harmless
Prime and its affiliates from and against any and all such claims, debts,
liabilities and obligations. Except as set forth in Schedule 3.4 hereto, since
June 30, 1999 there has been no material adverse change in the assets of the
Company, the Business, or the results of operations or financial position of the
Company.
3.5 Conduct of Business; Certain Actions. As used herein, "Business"
means all of the business conducted by the Company, which shall be deemed to
include all refractive surgery modalities, now performed, offered or made
available, including, without limitation, implantable contact lenses, instromal
corneal rings, laser in situs keratomileusis photorefractive keratectomy,
automated lemellar keratoplasty, radial keratotomy, astigmatic keratotomy and
similar procedures. Except as set forth on Schedule 3.5 attached hereto, since
June 30, 1999, the Company has conducted its Business and operations of the
Business in the ordinary course and consistent with its past practices and has
not (a) purchased or retired any indebtedness, or purchased, retired, or
redeemed any ownership interest from, any director, officer, shareholder,
employee or affiliate of the Company, or engaged in any other transaction that
involves or requires distributions of money or other assets from the Company to
any director, officer, shareholder, employee or affiliate of the Company if such
other transaction is not done in the ordinary course of business and is not
consistent with past practices of the Company, (b) increased the compensation of
any directors, officers, employees, agents, contractors, vendors or other
parties, except for wage and salary increases made in the ordinary course of
business and consistent with the past practices of the Company, (c) made capital
expenditures exceeding $10,000 individually or $25,000 in the aggregate, (d)
sold any asset (or any group of related assets) in any transaction (or series of
related transactions) in which the purchase price or book value for such asset
(or group of related assets) exceeded $10,000, (e) discharged or satisfied any
lien or encumbrance or paid any obligation or liability, absolute or contingent,
other than current liabilities incurred and paid in the ordinary course of
business, (f) made or guaranteed any loans or advances to any party whatsoever,
(g) suffered or permitted any lien, security interest, claim, charge, or other
encumbrance to arise or be granted or created against or upon any of its assets,
real or personal, tangible or intangible, (h) canceled, waived, or released any
of its debts, rights, or claims against third parties, (i) amended its
organizational documents, (j) made or paid any severance or termination payment
to any director, officer, employee, agent, contractor, vendor or consultant, (k)
made any change in its method of accounting, (l) made any investment or
commitment therefor in any person, business, corporation, association,
partnership, limited liability company, joint venture, trust, or other entity,
(m) made, entered into, amended, or terminated any written employment contract,
created, made, amended, or terminated any bonus, stock option, pension,
retirement, profit sharing, or other employee benefit plan or arrangement, or
withdrawn from any "multi-employer plan" (as defined in the Internal Revenue
Code of 1986, as amended (the "Code")) so as to create any liability under ERISA
(as hereinafter defined) to any person or entity, (n) amended, terminated or
experienced a termination of any material contract, agreement, lease, franchise,
or license to which it is a party, (o) made any distributions, in cash or in
kind, to its shareholders, or to any person or entity related to or affiliated
therewith, in any capacity, except such distributions as are made in the
ordinary course of the Company's business consistent with past practices, (p)
entered into any other material transactions except in the ordinary course of
business, (q) entered into any contract, commitment, agreement, or understanding
to do any acts described in the foregoing clauses (a)-(p) of this Section, (r)
suffered any material damage, destruction, or loss (whether or not covered by
insurance) to any assets, (s) experienced any strike, slowdown, or demand for
recognition by a labor organization by or with respect to any of its employees,
or (t) experienced or effected any shutdown, slow-down, or cessation of any
operations conducted by, or constituting part of, it.
3.6 Assets; Licenses, Permits, etc. Except as set forth on Schedule
3.6(a), the Company has good and marketable title to all of its assets, free and
clear of all liens, security interests, claims, rights of another, and
encumbrances of any kind whatsoever. The assets of the Company are in good
operating condition and repair, subject to ordinary wear and tear, taking into
account the respective ages of the properties involved and are all that are
necessary for the conduct of the Business. Attached hereto as Schedule 3.6(b) is
a list and description of all federal, state, county, and local governmental
licenses, certificates, certificates of need, permits, waivers, filings and
orders held or applied for by the Company and used or relied on (or to be used
or relied on) in connection with the Business ("Permits"). The Company has
complied in all material respects, and the Company is in compliance in all
material respects, with the terms and conditions of any such Permits. No
additional Permit is required from any federal, state, county, or local
governmental agency or body thereof in connection with the conduct of the
Business. No claim has been made by any governmental authority (and, to the
knowledge of Seller and the Company, no such claim has been threatened) to the
effect that a Permit not possessed by the Company is necessary in respect of the
Business.
3.7 Environmental Issues.
(a) For purposes of this Agreement, the term "environmental
laws" shall mean all laws and regulations relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling, or the emission, discharge, or release, of any pollutant, contaminant,
chemical, or industrial toxic or hazardous substance or waste, and any order
related thereto.
(b) The Company has complied in all material respects with and
obtained all authorizations and made all filings required by all applicable
environmental laws. The properties occupied or used by the Company have not been
contaminated with any hazardous wastes, hazardous substances, or other hazardous
or toxic materials in violation of any applicable environmental law, the
violation of which could have a material adverse impact on the Business or the
financial position of the Company.
(c) The Company has not received any notice from the United
States Environmental Protection Agency that it is a potentially responsible
party under the Comprehensive Environmental Response, Compensation and Liability
Act ("Superfund Notice"), any citation from any federal, state or local
governmental authority for non-compliance with its requirements with respect to
air, water or environmental pollution, or the improper storage, use or discharge
of any hazardous waste, other waste or other substance or other material
pertaining to its business ("Citations") or any written notice from any private
party alleging any such non-compliance; and there are no pending or unresolved
Superfund Notices, Citations or written notices from private parties alleging
any such non-compliance.
3.8 Intellectual Property Rights. There are no patents, trademarks,
trade names, or copyrights, and no applications therefor, owned by or registered
in the name of the Company or in which the Company has any right, license, or
interest. The Company is not a party to any license agreement, either as
licensor or licensee, with respect to any patents, trademarks, trade names, or
copyrights. The Company has not received any notice that it is infringing any
patent, trademark, trade name, or copyright of others.
3.9 Compliance with Laws. To the knowledge of the Company and Seller,
the Company has complied in all material respects, and the Company is in
compliance in all material respects, with all federal, state, county, and local
laws, rules, regulations and ordinances currently in effect. No claim has been
made or threatened by any governmental authority against the Company to the
effect that the business conducted by the Company fails to comply in any respect
with any law, rule, regulation, or ordinance.
3.10 Insurance. Attached hereto as Schedule 3.10 is a list of all
policies of fire, liability, business interruption, and other forms of insurance
(including, without limitation, professional liability insurance) and all
fidelity bonds held by or applicable to the Company at any time within the past
three (3) years, which schedule sets forth in respect of each such policy the
policy name, policy number, carrier, term, type of coverage, deductible amount
or self-insured retention amount, limits of coverage, and annual premium. To the
knowledge of the Company and Seller, no event directly relating to the Company
has occurred which will result in a retroactive upward adjustment of premiums
under any such policies or which is likely to result in any prospective upward
adjustment in such premiums. There have been no material changes in the type of
insurance coverage maintained by the Company during the past three (3) years,
including without limitation any change which has resulted in any period during
which the Company had no insurance coverage. Excluding insurance policies which
have expired and been replaced, no insurance policy of the Company has been
canceled within the last three (3) years and no threat has been made to cancel
any insurance policy of the Company within such period.
3.11 Employee Benefit Matters. Except as set forth on Schedule 3.11,
the Company does not maintain nor does it contribute nor is it required to
contribute to any "employee welfare benefit plan" (as defined in section 3(1) of
the Employee Retirement Income Security Act of 1974 (and any sections of the
Code amended by it) and all regulations promulgated thereunder, as the same have
from time to time been amended ("ERISA")) or any "employee pension benefit plan"
(as defined in ERISA). The Company does not presently maintain and has never
maintained, or had any obligation of any nature to contribute to, a "defined
benefit plan" within the meaning of the Code.
3.12 Contracts and Agreements. Attached hereto as Schedule 3.12 is a
list of all written or oral contracts, commitments, leases, and other agreements
(including, without limitation, all promissory notes, loan agreements, and other
evidences of indebtedness, mortgages, deeds of trust, security agreements,
pledge agreements, service agreements, and similar agreements and instruments
and all confidentiality agreements) to which the Company is a party or by which
the Company or its properties are bound, pursuant to which the obligations
thereunder of any party thereto are, or are contemplated as being, in respect of
any such individual contracts, commitments, leases, or other agreements during
any year during the term thereof, $25,000 or greater, or which are otherwise
material to the Business (collectively the "Contracts" and individually, a
"Contract"). The Company is not and, to the best knowledge of the Company and
Seller, no other party thereto is in default (and no event has occurred which,
with the passage of time or the giving of notice, or both, would constitute a
default by the Company or, to the best knowledge of the Company and Seller, by
any other party thereto) under any Contract. The Company has not waived any
material right under any Contract, and no consents or approvals (other than
those obtained in writing and delivered to Prime prior to Closing) are required
under any Contract in connection with the sale of Capital Stock or the
consummation of the transactions contemplated hereby. The Company has not
guaranteed any obligation of any other person or entity.
3.13 Claims and Proceedings. Attached hereto as Schedule 3.13 is a list
and description of all claims, actions, suits, proceedings, and investigations
pending or, to the knowledge of the Company and Seller, threatened against the
Company, at law or in equity, or before or by any court, municipal or other
governmental department, commission, board, agency, or instrumentality. Except
as set forth on Schedule 3.13 attached hereto, none of such claims, actions,
suits, proceedings, or investigations will result in any liability or loss to
the Company which (individually or in the aggregate) is material, and the
Company has not been, and the Company is not now, subject to any order,
judgment, decree, stipulation, or consent of any court, governmental body, or
agency. No inquiry, action, or proceeding has been asserted, instituted, or
threatened against the Company or Seller to restrain or prohibit the carrying
out of the transactions contemplated by this Agreement or to challenge the
validity of such transactions or any part thereof or seeking damages on account
thereof.
3.14 Taxes. All federal, foreign, state, county, and local income,
gross receipts, excise, property, franchise, license, sales, use, withholding,
and other tax (collectively, "Taxes") returns, reports, and declarations of
estimated tax (collectively, "Returns") which were required to be filed by the
company on or before the date hereof have been filed within the time (including
any applicable extensions) and in the manner provided by law, and all such
Returns are true and correct in all material respects and accurately reflect the
Tax liabilities of the Company. The Company has provided Prime with copies of
all returns filed for and during the years ended 1998, 1997 and (to the extent
an extension was filed for any return for the year ended 1998) 1996. All Taxes,
assessments, penalties, and interest which have become due pursuant to such
Returns have been paid or adequately accrued in the Financial Statements. The
provisions for Taxes reflected on the balance sheet contained in the Financial
Statements are adequate to cover all of the Company's estimated Tax liabilities
for the respective periods then ended and all prior periods. As of the Closing
Date, the Company will not owe any Taxes for any period prior to the Closing
which are not reflected on the Financial Statements, except for Taxes
attributable to the operations of the Company between June 30, 1999 and the
Closing Date. The Company has not executed any presently effective waiver or
extension of any statute of limitations against assessments and collection of
Taxes. There are no pending or threatened claims, assessments, notices,
proposals to assess, deficiencies, or audits (collectively, "Tax Actions")
against the Company with respect to any Taxes owed or allegedly owed by the
Company. There are no tax liens on any of the assets of the Company. Proper and
accurate amounts have been withheld and remitted by the Company from and in
respect of all persons from whom it is required by applicable law to withhold
for all periods in compliance with the tax withholding provisions of all
applicable laws and regulations. The Company is not a party to any tax sharing
agreement.
3.15 Personnel. Attached hereto as Schedule 3.15 is a list of names and
current annual rates of compensation of the officers, employees or agents of the
Company who are necessary for the operation of the Business (the "Employees").
Except as set forth on Schedule 3.15, there are no bonus, profit sharing,
percentage compensation, company automobile, club membership, and other like
benefits, if any, paid or payable by the Company to any Employees from December
31, 1998 through the Closing Date. Schedule 3.15 attached hereto also contains a
brief description of all material terms of employment agreements and
confidentiality agreements to which the Company is a party and all severance
benefits which any director, officer, Employee or sales representative of the
Company is or may be entitled to receive. The Company has delivered to Prime
accurate and complete copies of all such employment agreements, confidentiality
agreements, and all other agreements, plans, and other instruments to which the
Company is a party and under which its employees are entitled to receive
benefits of any nature. There is no pending or threatened (i) labor dispute or
union organization campaign relating to the Company, (ii) claims against the
Company by any employees of the Company (other than those certain Workers'
Compensation claims specifically described on Schedule 3.13), or (iii)
terminations, resignations or retirements of any employees of the Company. None
of the employees of the Company are represented by any labor union or
organization. There is no unfair labor practice claim against the Company before
the National Labor Relations Board or any strike, labor dispute, work slowdown,
or work stoppage pending or threatened against or involving the Company.
3.16 Business Relations. The Company has no reason to believe and has
not been notified that any supplier or customer of the Company will cease or
refuse to do business with the Company in the same manner as previously
conducted with the Company as a result of or within one (1) year after the
consummation of the transactions contemplated hereby, to the extent such
cessation or refusal might affect the Business. The Company has not received any
notice of any disruption (including delayed deliveries or allocations by
suppliers) in the availability of the materials or products used by the Company.
3.17 Working Capital. Except as set forth on Schedule 3.17 attached
hereto, all of the accounts, notes, and loans receivable (the "Accounts
Receivable") reflected in the Financial Statements, or arising since June 30,
1999, arose from transactions occurring in the ordinary course of the Company's
business as previously conducted, are bona fide and represent amounts validly
due, subject to offsets or defenses. Except for accounts payable and other
accrued expenses incurred in the ordinary course of the Company's business since
June 30, 1999 and consistent with past practices of the Company, there are no
liabilities of the Company other than those reflected in the Financial
Statements. Adequate provision has been made for uncollectible Accounts
Receivable. Since June 30, 1999, the Company has collected its Accounts
Receivable and has paid or performed all liabilities and obligations of the
Company in the ordinary course, consistent with past practices. The Working
Capital (as hereinafter defined) of the Company existing on the Closing Date is
equal to or greater than $100,000.
3.18 Agents. Except as set forth on Schedule 3.18 attached hereto, the
Company has not designated or appointed any person (other than the Company's
employees and officers) or other entity to act for it or on its behalf pursuant
to any power of attorney or any agency which is presently in effect.
3.19 Indebtedness To and From Directors, Officers, Shareholders and
Employees. The Company does not owe any indebtedness to any of its directors,
officers, shareholders, employees or affiliates, or have indebtedness owed to it
from any of its directors, officers, shareholders, employees or affiliates,
excluding indebtedness for travel advances or similar advances for expenses
incurred on behalf of and in the ordinary course of business of the Company and
consistent with the Company's past practices. As of the Effective Time and the
Closing Date all amounts due the Company from any of its directors, officers,
employees or affiliates (or any of their family members) shall have been repaid
in full.
3.20 Commission Sales Contracts. Except as disclosed in Schedule 3.20
attached hereto, the Company does not employ or have any relationship with any
individual, corporation, partnership, or other entity whose compensation from
the Company is in whole or in part determined on a commission basis.
3.21 Certain Consents. Except as set forth on Schedule 3.21 attached
hereto, there are no consents, waivers, or approvals required to be executed
and/or obtained by the Company from third parties in connection with the
execution, delivery, and performance of this Agreement or any of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement (all of which are collectively
referred to as the "Transaction Documents").
3.22 Brokers. The Company has not engaged, or caused any liability to
be incurred to, any finder, broker, or sales agent (and has not paid, and will
not pay, any finders fee or similar fee or commission to any person) in
connection with the execution, delivery, or performance of this Agreement or the
transactions contemplated hereby.
3.23 Interest in Competitors, Suppliers, and Customers. Except as set
forth on Schedule 3.23 attached hereto, neither the Company nor any affiliate of
the Company, and to the knowledge of the Company and Seller, no director,
officer, employee or affiliate of the Company or any affiliate of any director,
officer, employee or affiliate of the Company, has any ownership interest in any
competitor, customer or supplier of the Company or any property used in the
operation of the Business.
3.24 Warranties. Except as set forth on Schedule 3.24, the Company has
not made any warranties or guarantees to third parties with respect to any
products sold or services rendered by it. Except as set forth on Schedule 3.24
attached hereto, no claims for breach of product or service warranties have been
made against the Company since January 1, 1996.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to which it is a
party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel for Seller may
reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit B;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit C, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit D, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of (i) any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document, (ii) any claim, debt, obligation or liability of
the Company, not specifically and fully reflected by item and amount on either
Schedule 3.4 or in the Financial Statements, that is or may be asserted with
respect to any acts or omissions occurring, or circumstances existing, on or
prior to the Closing Date, except for liabilities incurred in the ordinary
course of business, or (iii) any obligations or liabilities with respect to any
claims arising out of actions or omissions, that occurred prior to the Closing
Date, by any of the Company's directors, officers, shareholders, agents,
employees, representatives, subsidiaries and/or affiliates.
(b) Seller agrees to indemnify and hold harmless each of the
Prime Indemnified Parties from and against any and all Indemnified Costs in
connection with the commencement or assertion of any third-party action which
any of the Prime Indemnified Parties may sustain, arising out of any breach or
default by Seller of any of its representations, warranties, covenants or
agreements contained in this Agreement or any Transaction Document.
(c) Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 6.1
unless and until such time as all claims of all Prime Indemnified Parties, taken
together, exceed $10,000 in the aggregate, at which time all claims of such
Prime Indemnified Parties may be asserted individually or in combination
(beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1 shall be limited to the aggregate Purchase Price received by Seller
under this Agreement, plus the greater of (a) the value of all remaining equity
interests which Seller holds in the Company at the time of Closing or (b) the
value of all remaining equity interests which Seller holds in the Company at the
time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party shall be
entitled to assert any claim for indemnification under this Section 7.1 unless
and until such time as all claims of such Seller Indemnified Party, individually
and not in combination with other Seller Indemnified Parties, exceed $25,000 in
the aggregate, at which time all claims of such Seller Indemnified Party may be
asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), (iii)
relocation of Seller's primary residence outside of a two hundred (200) mile
radius of the center or facility at which Seller primarily renders services, or
(iv) if Seller is a physician or other practicing licensed professional, the
performance by Seller, during any one-month period, of greater than thirty (30%)
of his or her professional medical activities outside of a two hundred (200)
mile radius of the center or facility primarily utilized by Seller prior to the
date of this Agreement; the Seller's executor, administrator, trustee,
custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or relocation of primary residence or practice, as the case may be, within which
time it may require that the Company purchase (subject to the remaining
provisions of this subsection) all of Seller's capital stock of the Company,
upon the terms and conditions hereinafter set forth, by giving notice of such
election in writing to the Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. Without in any way limiting or
qualifying the representation and warranty with respect to Working Capital
contained in Section 3.17, all parties to this Agreement acknowledge and agree
that no shareholder of the Company, or any other party, has any obligation
existing on the Closing Date to make a capital contribution to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH
CERTAIN CONDITIONS SPECIFIED IN A CERTAIN STOCK PURCHASE
AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1, 1999, A COMPLETE
AND CORRECT COPY OF WHICH IS AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED TO THE
HOLDER HEREOF UPON WRITTEN REQUEST AND WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Invalid Provisions. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable under present or future laws, such
provision shall be fully severable, this Agreement shall be construed as if such
illegal, invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxx X. Xxxxxxx, M.D.
000 Xxxxx Xx Xxxxxxx
Xxxxxx Xxxx, XX 00000-0000
Each party may change its address for purposes of this Section by proper
notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless of
any investigation at any time made by or on behalf of any party hereto or of any
information any party may have in respect thereof, all covenants, agreements,
representations, and warranties made hereunder or pursuant hereto or in
connection with the transactions contemplated hereby shall survive the Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to (i) Prime, it
shall mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx and (ii) the Company, it shall mean
such items as are within the actual knowledge of the officers of the Company
holding office immediately prior to the Closing, and any employee of the Company
who remains an employee of the Company after the Closing.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title:Secretary & Manager
Seller: /s/ Xxxxxxx X. Xxxxxxx, M.D.
Printed Name: Xxxxxxx X. Xxxxxxx, M.D.
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Financial Statements
EXHIBIT B: Form of Exclusive Use Agreement
EXHIBIT C: Form of Assignment and Security Agreement
EXHIBIT D: Form of Amended and Restated Bylaws of Seller
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and D. Xxxxx Xxxx and
Carellyn X. Xxxx, individuals residing in Folsom, California shareholders of the
Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time,
73,520 authorized and issued shares of the Company's $0.01 par value common
stock presently owned by Seller and evidenced by stock certificate number C-25
and C-94 (collectively, the "Capital Stock"). The purchase price for the Capital
Stock shall be $833,926.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement and each of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement, all of which are collectively
referred to as the "Transaction Documents"):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of Seller
Seller hereby represents and warrants to Prime that each of the
following matters is true and correct in all respects as of the Closing Date
(with the understanding that Prime is relying materially on each such
representation and warranty in entering into and performing this Agreement),
which representations and warranties shall also be deemed made as of the
Effective Time and which shall survive the Closing:
3.1 Due Authorization. Seller has full power and authority to enter
into and perform this Agreement and each Transaction Document required to be
executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
3.2 Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be free of any liens, claims or encumbrances whatsoever.
3.3 Ownership. Immediately following the Closing Date, except as set
forth on Schedule 3.3, Seller does not own (i) any shares of equity or other
voting securities of the Company, (ii) any securities of the Company convertible
into or exchangeable for shares of equity or other voting securities of the
Company, (iii) any options or other rights to acquire from the Company, or any
obligation of the Company to issue or sell, equity or other voting securities of
the Company, or securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) any equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company.
3.4 Claims and Proceedings. No inquiry, action, or proceeding has been
asserted, instituted, or threatened against Seller to restrain or prohibit the
carrying out of the transactions contemplated by this Agreement or to challenge
the validity of such transactions or any part thereof or seeking damages on
account thereof.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit A;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit B, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit C, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of any breach or default by
Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement, plus the greater of (a) the value of all remaining
equity interests which Seller holds in the Company at the time of Closing or (b)
the value of all remaining equity interests which Seller holds in the Company at
the time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), or
(iii) the performance by Seller, during any one-month period, of greater than
thirty (30%) of his or her professional medical activities outside of a two
hundred (200) mile radius of the center or facility primarily utilized by Seller
prior to the date of this Agreement; the Seller's executor, administrator,
trustee, custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or shift in the geographical location of Seller's practice, as the case may be,
within which time it may require that the Company purchase (subject to the
remaining provisions of this subsection) all of Seller's capital stock of the
Company, upon the terms and conditions hereinafter set forth, by giving notice
of such election in writing to Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. All parties to this Agreement
acknowledge and agree that no shareholder of the Company, or any other party,
has any obligation existing on the Closing Date to make a capital contribution
to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN
COMPLIANCE WITH CERTAIN CONDITIONS SPECIFIED IN A CERTAIN
STOCK PURCHASE AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1,
1999, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE FOR
INSPECTION AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE
FURNISHED TO THE HOLDER HEREOF UPON WRITTEN REQUEST AND
WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws, such provision
shall be fully severable, this Agreement shall be construed as if such illegal,
invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: D. Xxxxx Xxxx and Carellyn X. Xxxx
000 Xxxxxxx Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to Prime, it shall
mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several counterparts, each
of which shall constitute an original and all of which together shall constitute
one and the same instrument. Any party hereto may execute this Agreement by
signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title: Vice President
Seller: /s/ D. Xxxxx Xxxx
Printed Name: D. Xxxxx Xxxx
/s/ Carellyn X. Xxxx
Printed Name: Carellyn X. Xxxx
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Form of Exclusive Use Agreement
EXHIBIT B: Form of Assignment and Security Agreement
EXHIBIT C: Form of Amended and Restated Bylaws of Seller
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Severin Family
Trust, and shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time,
39,369 authorized and issued shares of the Company's $0.01 par value common
stock presently owned by Seller and evidenced by stock certificate number X-00,
X-00, X-00, and C-45 (collectively, the "Capital Stock"). The purchase price for
the Capital Stock shall be $446,557.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement and each of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement, all of which are collectively
referred to as the "Transaction Documents"):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of Seller
Seller hereby represents and warrants to Prime that each of the
following matters is true and correct in all respects as of the Closing Date
(with the understanding that Prime is relying materially on each such
representation and warranty in entering into and performing this Agreement),
which representations and warranties shall also be deemed made as of the
Effective Time and which shall survive the Closing:
3.1 Due Authorization. Seller has full power and authority to enter
into and perform this Agreement and each Transaction Document required to be
executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
3.2 Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be free of any liens, claims or encumbrances whatsoever.
3.3 Ownership. Immediately following the Closing Date, except as set
forth on Schedule 3.3, Seller does not own (i) any shares of equity or other
voting securities of the Company, (ii) any securities of the Company convertible
into or exchangeable for shares of equity or other voting securities of the
Company, (iii) any options or other rights to acquire from the Company, or any
obligation of the Company to issue or sell, equity or other voting securities of
the Company, or securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) any equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company.
3.4 Claims and Proceedings. No inquiry, action, or proceeding has been
asserted, instituted, or threatened against Seller to restrain or prohibit the
carrying out of the transactions contemplated by this Agreement or to challenge
the validity of such transactions or any part thereof or seeking damages on
account thereof.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit A;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit B, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit C, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of any breach or default by
Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement, plus the greater of (a) the value of all remaining
equity interests which Seller holds in the Company at the time of Closing or (b)
the value of all remaining equity interests which Seller holds in the Company at
the time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), or
(iii) the performance by Seller, during any one-month period, of greater than
thirty (30%) of his or her professional medical activities outside of a two
hundred (200) mile radius of the center or facility primarily utilized by Seller
prior to the date of this Agreement; the Seller's executor, administrator,
trustee, custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or shift in the geographical location of Seller's practice, as the case may be,
within which time it may require that the Company purchase (subject to the
remaining provisions of this subsection) all of Seller's capital stock of the
Company, upon the terms and conditions hereinafter set forth, by giving notice
of such election in writing to Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. All parties to this Agreement
acknowledge and agree that no shareholder of the Company, or any other party,
has any obligation existing on the Closing Date to make a capital contribution
to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN
COMPLIANCE WITH CERTAIN CONDITIONS SPECIFIED IN A CERTAIN
STOCK PURCHASE AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1,
1999, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE FOR
INSPECTION AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE
FURNISHED TO THE HOLDER HEREOF UPON WRITTEN REQUEST AND
WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws, such provision
shall be fully severable, this Agreement shall be construed as if such illegal,
invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Severin Family Trust
Xxxxxxx X. Xxxxxxx, Trustee
0000 XxXxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to Prime, it shall
mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several counterparts, each
of which shall constitute an original and all of which together shall constitute
one and the same instrument. Any party hereto may execute this Agreement by
signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title: Vice President
Seller: /s/ Xxxxxxx X. Xxxxxxx
Printed Name: Xxxxxxx X. Xxxxxxx,
Trustee under the Sevenin
Family Trust
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Form of Exclusive Use Agreement
EXHIBIT B: Form of Assignment and Security Agreement
EXHIBIT C: Form of Amended and Restated Bylaws of Seller
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and the Xxxxxxx and
Xxxxxx Xxxxxx Family Trust, a shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time, 7,920
authorized and issued shares of the Company's $0.01 par value common stock
presently owned by Seller and evidenced by stock certificate number C-28 and
C-38 (collectively, the "Capital Stock"). The purchase price for the Capital
Stock shall be $131,004.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement and each of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement, all of which are collectively
referred to as the "Transaction Documents"):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of Seller
Seller hereby represents and warrants to Prime that each of the
following matters is true and correct in all respects as of the Closing Date
(with the understanding that Prime is relying materially on each such
representation and warranty in entering into and performing this Agreement),
which representations and warranties shall also be deemed made as of the
Effective Time and which shall survive the Closing:
3.1 Due Authorization. Seller has full power and authority to enter
into and perform this Agreement and each Transaction Document required to be
executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
3.2 Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be free of any liens, claims or encumbrances whatsoever.
3.3 Ownership. Immediately following the Closing Date, except as set
forth on Schedule 3.3, Seller does not own (i) any shares of equity or other
voting securities of the Company, (ii) any securities of the Company convertible
into or exchangeable for shares of equity or other voting securities of the
Company, (iii) any options or other rights to acquire from the Company, or any
obligation of the Company to issue or sell, equity or other voting securities of
the Company, or securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) any equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company.
3.4 Claims and Proceedings. No inquiry, action, or proceeding has been
asserted, instituted, or threatened against Seller to restrain or prohibit the
carrying out of the transactions contemplated by this Agreement or to challenge
the validity of such transactions or any part thereof or seeking damages on
account thereof.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit A;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit B, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit C, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of any breach or default by
Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement, plus the greater of (a) the value of all remaining
equity interests which Seller holds in the Company at the time of Closing or (b)
the value of all remaining equity interests which Seller holds in the Company at
the time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), or
(iii) the performance by Seller, during any one-month period, of greater than
thirty (30%) of his or her professional medical activities outside of a two
hundred (200) mile radius of the center or facility primarily utilized by Seller
prior to the date of this Agreement; the Seller's executor, administrator,
trustee, custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or shift in the geographical location of Seller's practice, as the case may be,
within which time it may require that the Company purchase (subject to the
remaining provisions of this subsection) all of Seller's capital stock of the
Company, upon the terms and conditions hereinafter set forth, by giving notice
of such election in writing to Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. All parties to this Agreement
acknowledge and agree that no shareholder of the Company, or any other party,
has any obligation existing on the Closing Date to make a capital contribution
to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN
COMPLIANCE WITH CERTAIN CONDITIONS SPECIFIED IN A CERTAIN
STOCK PURCHASE AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1,
1999, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE FOR
INSPECTION AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE
FURNISHED TO THE HOLDER HEREOF UPON WRITTEN REQUEST AND
WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws, such provision
shall be fully severable, this Agreement shall be construed as if such illegal,
invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Xxxxxxx and Xxxxxx Xxxxxx Family Trust
000 Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to Prime, it shall
mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several counterparts, each
of which shall constitute an original and all of which together shall constitute
one and the same instrument. Any party hereto may execute this Agreement by
signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title: Vice President
Seller: /s/ Xxxxxxx X. Xxxxxx, M.D.
/s/ Xxxxxx X. Xxxxxx
Printed Name: Xxxxxxx X. Xxxxxx, M.D.,
Trustee under the Xxxxxxx and
Xxxxxx Xxxxxx Family Trust
Xxxxxx X. Xxxxxx, Trustee
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Form of Exclusive Use Agreement
EXHIBIT B: Form of Assignment and Security Agreement
EXHIBIT C: Form of Amended and Restated Bylaws of Seller
STOCK PURCHASE AGREEMENT
Among
PRIME/BDR ACQUISITION, L.L.C.
--------------------------
and
Horizon Vision Center, Inc.
--------------------
Dated September 1, 1999
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is entered into to be
effective as of September 1, 1999 (the "Effective Time"), among Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Prime"), Horizon
Vision Center, Inc., a Nevada corporation (the "Company") and Medical Vision
Technology Profit, Sharing Plan for the benefit of Xxxxxxx Xxxxxxxx, M.D., a
shareholder of the Company ("Seller").
The parties hereto agree as follows:
ARTICLE I
Agreement of Purchase and Sale
1.1 Agreement. Upon the basis of the representations and warranties, for
the consideration, and subject to the terms and conditions set forth in this
Agreement, Prime agrees to purchase from Seller, as of the Effective Time,
13,876 authorized and issued shares of the Company's $0.01 par value common
stock presently owned by Seller and evidenced by stock certificate number C-31
(collectively, the "Capital Stock"). The purchase price for the Capital Stock
shall be $157,393.00 (the "Purchase Price").
1.2 Closing. The closing of the transactions contemplated by Section
1.1 (the "Closing") shall take place at the offices of Akin, Gump, Strauss,
Xxxxx & Xxxx, L.L.P., 1900 Frost Bank Plaza, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxx
00000, or at such other location as the parties may agree. The date on which the
Closing occurs is hereinafter referred to as the "Closing Date."
1.3 Payment of Purchase Price. The Purchase Price is to be paid to Seller
at the Closing by check or money order.
ARTICLE II
Representations and Warranties of Prime
Prime represents and warrants to Seller that each of the following
matters is true and correct in all respects as of the Closing (with the
understanding that Seller is relying materially on such representations and
warranties in entering into and performing this Agreement and each of the other
contracts, documents, instruments or agreements to be entered into in connection
with or as contemplated by this Agreement, all of which are collectively
referred to as the "Transaction Documents"):
2.1 Due Organization and Principal Executive Office. Prime is a limited
liability company duly organized, validly existing, and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now conducted and as proposed to be conducted. Prime is
controlled by Prime Medical Operating, Inc., a Delaware corporation ("PMOI"),
and PMOI is a direct or indirect wholly owned subsidiary of PMSI. Prime's
principal executive offices are located at 0000 Xxxxxxx xx Xxxxx Xxxxxxx,
Xxxxxx, Xxxxx 00000.
2.2 Due Authorization. Prime has full corporate power and authority to
enter into and perform this Agreement and each Transaction Document required to
be executed by Prime in connection herewith. This Agreement and each Transaction
Document required herein to be executed by Prime have been duly and validly
authorized, executed and delivered by Prime and constitute the valid and binding
obligations of Prime enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Agreement and each Transaction
Document required herein to be executed by Prime will not (a) violate any
federal, state, county, or local law, rule, or regulation applicable to Prime or
its properties, (b) violate or conflict with, or permit the cancellation of, any
agreement to which Prime is a party or by which it or its properties are bound,
(c) permit the acceleration of the maturity of any indebtedness of, or any
indebtedness secured by the property of, Prime or (d) violate or conflict with
any provision of the organizational documents of Prime. No action, consent, or
approval of, or filing with, any federal, state, county, or local governmental
authority is required by Prime in connection with the execution, delivery or
performance of this Agreement or any Transaction Document.
2.3 Brokers and Finders. Prime has not engaged, or caused to be
incurred any liability to, any finder, broker, or sales agent (and has not paid,
and will not pay, any finder's fee or similar fee or commission to any person)
in connection with the execution, delivery, or performance of this Agreement or
the transactions contemplated hereby.
2.4 Claims and Proceedings. Prime is not a party to any claims,
actions, suits, proceedings, or investigations, at law or in equity, before or
by any court, municipal or other governmental department, commission, board,
agency, or instrumentality which seeks to restrain or prohibit the carrying out
of the transactions contemplated by this Agreement or to challenge the validity
of such transactions or any part thereof or seeking damages on account thereof;
and, to the knowledge of Prime, no such claim, action, suit, proceeding or
investigation is threatened.
ARTICLE III
Representations and Warranties of Seller
Seller hereby represents and warrants to Prime that each of the
following matters is true and correct in all respects as of the Closing Date
(with the understanding that Prime is relying materially on each such
representation and warranty in entering into and performing this Agreement),
which representations and warranties shall also be deemed made as of the
Effective Time and which shall survive the Closing:
3.1 Due Authorization. Seller has full power and authority to enter
into and perform this Agreement and each Transaction Document required to be
executed by Seller in connection herewith. This Agreement and each such
Transaction Document has been duly and validly executed and delivered by Seller
and constitutes a valid and binding obligation of Seller, enforceable against
Seller in accordance with its terms. The execution, delivery, and performance of
this Agreement, and each Transaction Document required herein to be executed by
Seller do not (a) violate any federal, state, county, or local law, rule, or
regulation applicable to Seller or the Capital Stock, (b) violate or conflict
with, or permit the cancellation of, any agreement to which Seller is a party,
or by which Seller or the Capital Stock is bound, or result in the creation of
any lien, security interest, charge, or encumbrance upon the Capital Stock, or
(c) permit the acceleration of the maturity of any indebtedness of Seller. No
action, consent, waiver or approval of, or filing with, any federal, state,
county or local governmental authority is required by Seller in connection with
the execution, delivery, or performance of this Agreement (or any Transaction
Document).
3.2 Stock Transferred. The Capital Stock transferred by Seller to Prime at
the Closing will be free of any liens, claims or encumbrances whatsoever.
3.3 Ownership. Immediately following the Closing Date, except as set
forth on Schedule 3.3, Seller does not own (i) any shares of equity or other
voting securities of the Company, (ii) any securities of the Company convertible
into or exchangeable for shares of equity or other voting securities of the
Company, (iii) any options or other rights to acquire from the Company, or any
obligation of the Company to issue or sell, equity or other voting securities of
the Company, or securities of the Company convertible into or exchangeable for
such equity or voting securities, and (iv) any equity equivalents, interests in
the ownership or earnings, rights to participate in the election of directors or
other similar rights of or with respect to the Company.
3.4 Claims and Proceedings. No inquiry, action, or proceeding has been
asserted, instituted, or threatened against Seller to restrain or prohibit the
carrying out of the transactions contemplated by this Agreement or to challenge
the validity of such transactions or any part thereof or seeking damages on
account thereof.
ARTICLE IV
Covenants
4.1 Cooperation Relating to Financial Statements. The Company agrees to
cooperate with Prime in the preparation of any financial statements of the
Company which Prime or its affiliates may be required by any applicable law to
prepare.
4.2 Capital Contributions. The parties acknowledge and agree that any
capital contributions to the Company after the date of this Agreement shall be
governed by the organizational documents of the Company.
4.3 Issuance of Stock. The Company agrees that it will not after the
Closing, without the prior written consent of Prime in each instance, issue any
equity securities or other ownership interests in the Company, or any securities
or rights convertible into, or exchangeable or exercisable for, any such equity
securities or other ownership interests in the Company.
4.4 Distribution of Working Capital. In accordance with the resolutions
adopted by Horizon on August 10, 1999, the parties agree that all cash in excess
of the minimum amount of Working Capital (as hereinafter defined) required
pursuant to Section 5.2(h) shall be distributed within thirty (30) days of the
Closing (as dividends) to the shareholders of Horizon existing on August 1,
1999.
ARTICLE V
Conditions to Closing
5.1 Prime's Closing Obligations. At the Closing, Prime shall (each of which
is a condition to the obligations of Seller to close):
(a) deliver the Purchase Price to Seller;
(b) execute and deliver each of the Transaction Documents to
which it is a party; and
(c) deliver such good standing certificates, officer
certificates, and similar documents and certificates as counsel
for Seller may reasonably require.
5.2 Seller's and the Company's Closing Obligations. At the Closing, Seller
and the Company agree that (each of which is a condition to the obligations of
Prime to close):
(a) each of them will execute and deliver each of the Transaction Documents
to which it is a party;
(b) a sufficient number of the shareholders of the Company
shall have entered into stock purchase agreements (the "Related Acquisitions")
for the sale of all or part of their capital stock of the Company, pursuant to
which, immediately after the Closing of this transaction, Prime will own not
less than sixty percent (60%) of the Company's issued and outstanding capital
stock, considering all classes of stock, and assuming the conversion, exercise
or exchange of all rights, options, or other securities convertible into or
exercisable or exchangeable for any shares of the Company's capital stock;
(c) each of the shareholders of the Company existing
immediately prior to the Closing (including Seller) that is a physician or other
licensed medical professional shall have executed and delivered to Prime an
Exclusive Use Agreement in substantially the form attached hereto as Exhibit A;
(d) Seller, and each of the other Company shareholders selling
Company stock to Prime in a Related Acquisition (the "Selling Shareholders"),
who will remain a shareholder of the Company after the Closing shall have
executed and delivered to Prime an Assignment and Security Agreement, in
substantially the form attached hereto as Exhibit B, granting a security
interest in such shareholder's remaining stock in the Company to secure the
performance by such shareholder under any agreement it has with Prime or any of
Prime's affiliates;
(e) the Company shall have adopted, after obtaining all
necessary approvals and consents, the Amended and Restated Bylaws, in
substantially the form attached hereto as Exhibit C, which shall contain
provisions governing its board of directors that are consistent with the
provisions of Section 9.4 of this Agreement, including, without limitation, that
the number of directors serving on its board of directors of the Company shall
be five (5);
(f) at the Closing, the Company's board of directors shall
consist of three (3) individuals designated by Prime and listed on Schedule
5.2(f) hereto, and two (2) individuals designated by a majority of the
shareholders of the Company immediately prior to Closing and listed on Schedule
5.2(f) hereto;
(g) the Company shall have delivered to Prime true and correct
copies of resignations, effective as of the Closing Date, from each of the
persons holding the offices set forth on Schedule 5.2(g) hereto, and the persons
listed on Schedule 5.2(g) hereto shall have been elected or appointed to the
office set forth opposite their name;
(h) As of the Closing Date, the amount of Working Capital of
the Company shall be at least $100,000 (for purposes of this Agreement, "Working
Capital" means the difference between (i) cash, cash equivalents, prepaid
expenses and Accounts Receivable less than sixty (60) days old and (ii) accounts
payable and other liabilities and payment obligations due in the following
twelve (12) months, all as determined in accordance with GAAP); and
(i) each of them, and each Selling Shareholder, shall have
delivered such good standing certificates, officer certificates, and similar
documents and certificates as counsel for Prime may have reasonably requested.
ARTICLE VI
Indemnification of Prime
6.1 Indemnification of Prime.
(a) The Company agrees to indemnify and hold harmless Prime,
each subsidiary and/or affiliate of Prime (including, without limitation, PMOI
and PMSI) and each shareholder, member, partner (or other owner), officer,
director, agent, employee, representative and affiliate of any of the foregoing
(collectively, the "Prime Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, demands, charges, suits, penalties, costs,
and expenses (including court costs and attorneys' fees and expenses incurred in
investigating and preparing for any litigation or proceeding) (collectively,
"Indemnified Costs") in connection with the commencement or assertion of any
action, proceeding, demand, or claim by a third party (collectively, a
"third-party action") which any of the Prime Indemnified Parties may sustain,
arising out of any breach or default by Seller or the Company of any of the
representations, warranties, covenants or agreements contained in this Agreement
or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(a) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $25,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
(b) Seller agrees to indemnify and hold harmless each Prime
Indemnified Party from and against any and all Indemnified Costs in connection
with the commencement or assertion of any third-party action which any of the
Prime Indemnified Parties may sustain, arising out of any breach or default by
Seller of any of its representations, warranties, covenants or agreements
contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Prime Indemnified Party
shall be entitled to assert any claim for indemnification under this Section
6.1(b) unless and until such time as all claims of all Prime Indemnified
Parties, taken together, exceed $10,000 in the aggregate, at which time all
claims of such Prime Indemnified Parties may be asserted individually or in
combination (beginning with the first dollar).
6.2 Defense of Third-Party Claims. A Prime Indemnified Party shall give
prompt written notice to the Company and, if applicable, Seller (collectively in
instances involving the Seller, the "indemnifying party"), of the commencement
or assertion of any third party action in respect of which such Prime
Indemnified Party shall seek indemnification hereunder. Any failure to so notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have to such Prime Indemnified Party under this ARTICLE
unless the failure to give such notice materially and adversely prejudices the
indemnifying party. The indemnifying party shall have the right to assume
control of the defense of, settle, or otherwise dispose of such third-party
action on such terms as it deems appropriate; provided, however, that:
(a) The Prime Indemnified Party shall be entitled, at his, her, or its own
expense, to participate in the defense of such third-party action;
(b) The indemnifying party shall obtain the prior written
approval of the Prime Indemnified Party, which approval shall not be
unreasonably withheld, before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of such third-party
action or any liability in respect thereof if, pursuant to or as a result of
such settlement, compromise, admission, or acknowledgment, injunctive or other
equitable relief would be imposed against the Prime Indemnified Party;
(c) The indemnifying party shall not consent to the entry of
any judgment or enter into any settlement that does not include as an
unconditional term thereof the execution and delivery of a release from all
liability in respect of such third-party action by each claimant or plaintiff
to, and in favor of, each Prime Indemnified Party; and
(d) The indemnifying party shall not be entitled to control
(but shall be entitled to participate at its own expense in the defense of), and
the Prime Indemnified Party shall be entitled to have sole control over, the
defense or settlement, compromise, admission, or acknowledgment of any
third-party action as to which the indemnifying party fails to assume the
defense within thirty (30) days; provided, however, that the Prime Indemnified
Party shall make no settlement, compromise, admission, or acknowledgment which
would give rise to liability (other than liability to Prime Indemnified Parties
under this Agreement) on the part of the indemnifying party, without the prior
written consent of the indemnifying party.
(e) The indemnifying party shall make payments of all amounts
required to be made pursuant to the foregoing provisions of this ARTICLE to or
for the account of the Prime Indemnified Party from time to time promptly upon
receipt of bills or invoices relating thereto or when otherwise due and payable,
provided that the Prime Indemnified Party has agreed in writing to reimburse the
indemnifying party for the full amount of such payments if the Prime Indemnified
Party is ultimately determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
6.3 Limitation of Seller's Liability. Notwithstanding anything to the
contrary contained in this ARTICLE, the aggregate liability of Seller to all
Prime Indemnified Parties for all Indemnified Amounts payable by Seller under
Section 6.1(b) shall be limited to the aggregate Purchase Price received by
Seller under this Agreement, plus the greater of (a) the value of all remaining
equity interests which Seller holds in the Company at the time of Closing or (b)
the value of all remaining equity interests which Seller holds in the Company at
the time an Indemnified Amount is required to be paid.
ARTICLE VII
Indemnification of Seller and the Company
7.1 Indemnification of Seller and the Company. Prime agrees to
indemnify and hold harmless Seller and the Company, and each of the Company's
directors, officers, shareholders, agents, employees and representatives
(collectively, the "Seller Indemnified Parties"), from and against any and all
Indemnified Costs in connection with the commencement or assertion of any third
party action which any of the Seller Indemnified Parties may sustain, arising
out of any breach or default by Prime of any of the representations, warranties,
covenants or agreements contained in this Agreement or any Transaction Document.
Notwithstanding the foregoing, no Seller Indemnified Party
shall be entitled to assert any claim for indemnification under this Section 7.1
unless and until such time as all claims of such Seller Indemnified Party,
individually and not in combination with other Seller Indemnified Parties,
exceed $25,000 in the aggregate, at which time all claims of such Seller
Indemnified Party may be asserted (beginning with the first dollar).
7.2 Defense of Third-Party Claims. A Seller Indemnified Party shall
give prompt written notice to Prime of the commencement or assertion of any
third party action in respect of which such Seller Indemnified Party shall seek
indemnification hereunder. Any failure so to notify Prime shall not relieve
Prime from any liability that it may have to such Seller Indemnified Party under
this ARTICLE unless the failure to give such notice materially and adversely
prejudices Prime. Prime shall have the right to assume control of the defense
of, settle, or otherwise dispose of such third-party action on such terms as it
deems appropriate; provided, however, that:
(a) The Seller Indemnified Party shall be entitled, at his or its own
expense, to participate in the defense of such third-party action;
(b) Prime shall obtain the prior written approval of the
Seller Indemnified Party, which approval shall not be unreasonably withheld,
before entering into or making any settlement, compromise, admission, or
acknowledgment of the validity of such third-party action or any liability in
respect thereof if, pursuant to or as a result of such settlement, compromise,
admission, or acknowledgment, injunctive or other equitable relief would be
imposed against the Seller Indemnified Party;
(c) Prime shall not consent to the entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the execution and delivery of a release from all liability in respect of such
third-party action by each claimant or plaintiff to, and in favor of, each
Seller Indemnified Party; and
(d) Prime shall not be entitled to control (but shall be
entitled to participate at its own expense in the defense of), and the Seller
Indemnified Party shall be entitled to have sole control over, the defense or
settlement, compromise, admission, or acknowledgment of any third-party action
as to which Prime fails to assume the defense within thirty (30) days; provided,
however, that the Seller Indemnified Party shall make no settlement, compromise,
admission, or acknowledgment which would give rise to liability (other than
liability to Seller Indemnified Parties under this Agreement) on the part of
Prime without the prior written consent of Prime.
(e) Prime shall make payments of all amounts required to be
made pursuant to the foregoing provisions of this ARTICLE to or for the account
of the Seller Indemnified Party from time to time promptly upon receipt of bills
or invoices relating thereto or when otherwise due and payable, provided that
the Seller Indemnified Party has agreed in writing to reimburse Prime for the
full amount of such payments if the Seller Indemnified Party is ultimately
determined not to be entitled to such indemnification.
(f) The parties hereto shall extend reasonable cooperation in
connection with the defense of any third-party action pursuant to this ARTICLE
and, in connection therewith, shall furnish such records, information, and
testimony and attend such conferences, discovery proceedings, hearings, trials,
and appeals as may be reasonably requested.
ARTICLE VIII
Restrictive Covenants
8.1 Confidentiality Agreement. Seller and the Company each agree that
it has been and may continue to be, through its relationship with Prime, be
exposed to confidential information and trade secrets pertaining to, or arising
from, the business of Prime and/or each of Prime's present or future affiliates
(which includes, without limitation, Prime, PMOI, PMSI and each of their present
or future affiliates) (individually and collectively, "Discloser"), that such
information and trade secrets are unique and valuable and that Discloser would
suffer irreparable injury if this information or trade secrets were divulged to
those in competition with Discloser. Therefore, Seller and the Company each
agree to keep in strict secrecy and confidence, both during and after the period
during which Prime owns any interest in the Company, any and all information
concerning Discloser which Seller or the Company acquires, or to which Seller or
the Company has access through its relationship with Discloser, that has not
been publicly disclosed by Discloser or that is not a matter of common knowledge
by Discloser's competitors (collectively, "Proprietary Information"). The
Proprietary Information covered by this Agreement shall include, but shall not
be limited to, information relating to any inventions, processes, software,
formulae, plans, devices, compilations of information, technical data, mailing
lists, management strategies, business distribution methods, names of suppliers
(of both goods and services) and customers, names of employees and terms of
employment, arrangements entered into with suppliers and customers, including,
but not limited to, proposed expansion plans of Discloser, marketing and other
business and pricing strategies, and trade secrets of Discloser.
Except with prior written approval of Discloser, neither Seller nor the
Company will: (i) directly or indirectly, disclose any Proprietary Information
to any person except authorized personnel of Discloser or (ii) use Proprietary
Information in any way. Within forty-eight (48) hours of the time at which
Prime's and its affiliates' aggregate voting equity interests in the Company
constitute less than fifty percent (50%) of the outstanding voting equity
interests of the Company, whether the disposition resulting in such ownership is
voluntary or involuntary, each of Seller and the Company will deliver to Prime
(without retaining copies thereof) all documents, records or other
memorializations including copies of documents and any notes which Seller or the
Company has prepared, that contain Proprietary Information or relate to
Discloser's business, all other tangible Proprietary Information in Seller's or
the Company's possession or control, and all of Discloser's credit cards, keys,
equipment, vehicles, supplies and other materials that are in possession or
under Seller's or the Company's control.
8.2 Agreement by Seller and the Company. Seller and the Company each
hereby agrees that, until the fifth (5th) anniversary of the Closing Date,
neither Seller nor the Company will directly or indirectly, either through any
kind of ownership (other than ownership of securities of a publicly held
corporation of which it owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
employee, advisor, consultant, co-partner or in any individual or representative
capacity whatever, either for its own benefit or for the benefit of any other
person, corporation or other entity, without the prior written consent of Prime,
commit any of the following acts, which acts shall be considered violations of
this covenant not to compete:
(a) Except through the Company, engage in or provide any
services that are provided by the Company, directly or indirectly, anywhere
within a two hundred (200) mile radius of any center or facility at any time
operated by the Company or any of the Company's affiliates, including, without
limitation, any services related to, (i) the operating of laser refractive
surgical centers, (ii) the manufacture, maintenance, refurbishing, repair, sale,
or leasing of any equipment related to or necessary for the operating of laser
refractive surgical centers, or (iii) providing any management services,
training or consulting services related to any of the activities described in
(i) or (ii);
(b) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Prime, or any affiliate or related entity of Prime, to withdraw, curtail, or
cancel its business with Prime or such affiliate or related entity; or
(c) Directly or indirectly hire any employee of Prime, or any
affiliate or related entity of Prime, or induce or attempt to influence any
employee of Prime or any such affiliate or related entity to terminate his or
her employment with Prime or any such affiliate or related entity.
8.3 Restrictions Reasonable. Seller and the Company have each reviewed
and carefully considered the provisions of this ARTICLE and, having done so,
agrees that the restrictions applicable to it as set forth herein (a) are fair
and reasonable with respect to time, geographic area and scope, (b) are not
unduly burdensome to it, and (c) are reasonably required for the protection of
the interests of the other parties hereto for whose benefit such restrictions
were agreed upon.
8.4 Remedies. Seller and the Company each agrees that a violation on
its part of any applicable covenant contained in this ARTICLE will cause the
other parties hereto for whose benefit such restrictions were agreed upon
irreparable damage for which remedies at law may be insufficient, and for that
reason, Seller and the Company each agrees that the other parties shall be
entitled as a matter of right to equitable remedies, including specific
performance and injunctive relief, therefor. The right to specific performance
and injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the other parties may have, including,
specifically, recovery of additional damages.
ARTICLE IX
Post Closing Agreements
9.1 Right of Set Off. Seller and the Company each agrees that Prime
shall have rights of offset against distributions to Seller in respect of any
ownership interest it may have in the Company immediately following the Closing
or at any time thereafter arising, for any and all debts, obligations or
liabilities that Seller may have to Prime, including, without limitation, any
liability arising out of or relating to any obligation arising under Seller's or
the Company's indemnity obligations under this Agreement or any Transaction
Document. Seller hereby authorizes the Company, and appoints the Company as its
attorney in fact, to pay such offset amounts to Prime and to take all other
actions necessary in connection with such payment. The Company agrees to
promptly remit any and all such offset amounts to Prime upon request.
9.2 Special Options to Sell or Acquire Remaining Capital Stock.
(a) Prohibition on Sale. Notwithstanding anything in this
Agreement to the contrary, Seller agrees that it will not transfer, assign,
pledge, hypothecate, or in any way alienate any of its shares of capital stock
of the Company, or any interest therein, whether voluntarily or by operation of
law, or by gift or otherwise, except in accordance with the provisions of this
Section or Section 9.3, or except pursuant to that certain Assignment and
Security Agreement by and between Prime or one of its affiliates and Seller,
dated as of the date of this Agreement (the "Security Agreement"). Any purported
transfer in violation of this Section or Section 9.3 shall be void and
ineffectual, and shall not operate to transfer any interest or title to the
purported transferee. Seller agrees that the Company may, and the Company agrees
to, issue stop-transfer orders, or take any other necessary action, to ensure
that the foregoing provisions of this Section and Section 9.3 are given full
effect.
(b) Option to Sell. Upon (i) the death, retirement (only if
Seller is a physician and only as defined below), bankruptcy, insolvency,
disability (only if Seller is a physician and only as defined below) or
incompetency of Seller, (ii) any other involuntary transfer of any capital stock
of the Company now or hereafter owned by Seller, or any interest therein
(including, without limitation, transfers of interests upon divorce or death of
a spouse of Seller, but excluding any transfers governed by Section 9.3), or
(iii) the performance by Seller, during any one-month period, of greater than
thirty (30%) of his or her professional medical activities outside of a two
hundred (200) mile radius of the center or facility primarily utilized by Seller
prior to the date of this Agreement; the Seller's executor, administrator,
trustee, custodian, receiver or other legal or personal representative (the
"Representative"), or Seller, in the case of retirement or departure, shall give
written notice of that fact to the Company. In such event, the Representative or
Seller shall have a period of sixty (60) days (the "Put Period") following the
date of such death, retirement, bankruptcy, insolvency, disability, incompetency
or shift in the geographical location of Seller's practice, as the case may be,
within which time it may require that the Company purchase (subject to the
remaining provisions of this subsection) all of Seller's capital stock of the
Company, upon the terms and conditions hereinafter set forth, by giving notice
of such election in writing to Company. The Company may, in its sole discretion,
offer all or a portion of such capital stock to its shareholders, on a pro rata
basis in relation to each shareholder's percentage ownership of the Company, but
any agreement by the shareholders to purchase all or a portion of such capital
stock shall not limit the Company's obligation to purchase within the time frame
set forth in this Section. If the Company has offered all of such capital stock
to its shareholders, and the shareholders have not committed to purchase all of
such capital stock within five (5) days from the date of offer, then the Company
may, in its sole discretion, offer all or a portion of the remaining capital
stock to Prime, in which event Prime must participate in such purchase upon the
same terms and conditions as the Company. For purposes of this Agreement, (x)
"disability" shall apply only if Seller is a physician and shall mean any
condition which in the reasonable judgment of a majority of the managers of
Prime, would impair Seller's ability to materially perform his or her routine
duties for a period of six (6) months or more, (y) "retirement" shall apply only
if Seller is a physician and shall mean the cessation of the routine practice of
medicine (provided that any physician who transfers his or her entire practice
to a licensed medical professional meeting the Company's then current
credentialing program shall not be deemed to have retired for purposes of this
subsection), and (z) "incompetent" shall mean a state of legal incompetence as
declared by a court of valid jurisdiction.
(c) Option to Buy. In the event that the option described in
Section 9(b) arises and the Representative or Seller, as the case may be, fails
to make the election described in Section 9(b) within the Put Period, Prime
shall at all times thereafter have the option to purchase all or any portion of
Seller's capital stock of the Company, upon the terms and conditions hereinafter
set forth, by giving written notice of such election in writing to Seller. In
addition, Prime may, in its sole discretion, transfer its purchase right granted
under this subsection (or stock acquired pursuant to an exercise of its purchase
right granted under this subsection) to Horizon or any of the physician
shareholders of the Company.
(d) Purchase Price. The purchase price to be paid pursuant to
this Section shall be paid in immediately available funds at the closing of the
transfer of capital stock pursuant to this Section. If the parties do not
otherwise agree within thirty (30) days of the day on which the option to
purchase or sell hereunder is exercised, then Prime shall, at its own expense,
select an appraiser to value the capital stock being transferred. If Seller or
Representative does not agree with the value determined by the appraiser of
Prime, Seller or Representative may, at its own expense, select its own
appraiser to value the capital stock being transferred. If the two appraisers
cannot agree on the value of the capital stock being transferred, the two
appraisers shall mutually select a third appraiser to value the capital stock
being transferred, and any valuation determined by such third appraiser shall be
final, binding and conclusive. The cost of any third appraiser shall be borne by
Seller.
(e) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice under either Section 9(b) or
Section 9(c). At such closing, Seller shall execute all documents and take such
other actions as may be reasonably necessary to deliver to Prime such capital
stock, and any certificates representing same, free and clear of all liens,
claims, encumbrances or restrictions of any kind or nature whatsoever, except
those imposed under the Security Agreement.
9.3 Right of First Refusal.
(a) If there is no option to sell or buy outstanding under
Section 9.2 (except in connection with a sale by a physician of all of his or
her practice upon retirement), and Seller intends to voluntarily transfer any
portion of its capital stock of the Company to any person or entity other than
Prime, then Seller shall give written notice to Prime stating (i) the intention
to transfer such capital stock, (ii) the number of shares to be transferred,
(iii) the name, business and residence address of the proposed transferee, (iv)
the nature and amount of the consideration, and (v) the other terms of the
proposed sale.
(b) Prime shall have, and may exercise within sixty (60) days
after receipt of the notice of intent to transfer, an option to purchase all or
any portion of the capital stock of the Company owned by Seller, at the per
share price and upon the other terms stated in the notice of intent to transfer.
Prime may elect to exercise its option under this Section by delivering notice
thereof to Seller. If Prime elects not to purchase all or any portion of such
capital stock prior to the expiration of said sixty (60) day period, Seller
shall have thirty (30) days to complete the sale and purchase contemplated in
the notice of intent to transfer, and after such thirty (30) day period, the
provisions of this Section shall apply fully to any such capital stock not
transferred. The purchase price pursuant to this Section shall be paid in
immediately available funds at the closing of the transfer pursuant to this
Section.
(c) Seller and Prime acknowledge and agree that it would be
impractical to exercise an option to purchase arising pursuant to this Section
whenever the proposed consideration to be received by Seller is other than cash,
cash equivalents or an obligation to pay cash by a person whose credit
worthiness and financial status is such that performance of the payment
obligation would be reasonably assured. Therefore, the parties agree that no
transfer shall be permitted and no option shall arise pursuant to this Section
whenever the consideration to be received from the proposed transferee is other
than cash, cash equivalents or an obligation to pay cash by a person whose
credit worthiness and financial status is such that performance of the payment
obligation would be reasonably assured.
(d) The closing of any purchase and sale of capital stock
pursuant to this Section shall take place at the principal office of Prime or
such other place designated by Prime and Seller, on the thirtieth day (or if
such thirtieth day is not a business day, the next business day following the
thirtieth day) following the delivery of notice of Prime's election to purchase
pursuant to Section 9(b). At such closing, Seller shall execute all documents
and take such other actions as may be reasonably necessary to deliver to Prime
such capital stock, and any certificates representing same, free and clear of
all liens, claims, encumbrances or restrictions of any kind or nature
whatsoever, except those imposed under the Security Agreement.
9.4 Voting Agreement. Each of the parties hereto agrees that it will
vote all of the shares of capital stock of the Company owned by it, at any time
after the execution of this Agreement, in accordance with the terms of this
Section 9.4. Any additional shares of voting capital stock or other voting
securities of the Company, or the voting rights related thereto, whether
presently existing or created in the future, that may be owned, held, or
subsequently acquired in any manner, legally or beneficially, directly or
indirectly, of record or otherwise, by the parties at any time after the
execution of this Agreement, whether issued incident to any stock split, stock
dividend, increase in capitalization, recapitalization, merger, consolidation,
share exchange, reorganization, or other transaction, shall be shall be subject
to the terms of this Section (all such stock presently held or controlled,
together with such additional stock, the "Subject Shares"). At each election of
directors of the Company, the parties and any transferee or assignee of any
Subject Shares from the parties (the "Transferee") shall, in accordance with the
procedure set forth below, vote the Subject Shares as necessary to elect five
(5) persons, designated in accordance with the procedures below, to the board of
directors of the company. Three (3) of the directors (the "Prime Designees")
shall be designated in writing by Prime or its Transferee. The remaining two (2)
directors (the "Other Stockholder Designees") shall be jointly designated in
writing by stockholders of the corporation other than Prime (or any entity other
than the Company that is controlled by, controlling or under common control with
Prime) (the "Other Stockholders") holding a majority of the aggregate voting
equity stock held by all Other Stockholders. For purposes of this Section, the
Prime Designees and the Other Stockholder Designees are sometimes referred to
individually as a "Designated Director" and collectively as "Designated
Directors." During the term of this Agreement, the parties shall, in accordance
with the procedure set forth below, (i) vote their Subject Shares and use their
best efforts in any event to ensure that the number of directors which shall
constitute the entire board of directors of the Company shall remain at five
(5), (ii) vote their Subject Shares in favor of the removal of a Designated
Director if Prime or a majority in interest of the Other Stockholders (whichever
designated the respective director) instruct in writing that such Designated
Director shall be removed from office and (iii) upon any removal of a Designated
Director pursuant to (ii) above, vote their Subject Shares in favor of the
election of a replacement director designated in writing by Prime or a majority
in interest of the Other Stockholders (whichever designated the respective
director). None of the parties to this Agreement shall approve or authorize the
removal of any Designated Director unless Prime or a majority in interest of the
Other Stockholders (whichever designated the respective director) shall have
authorized in writing such Designated Director's removal. To the extent that any
party or parties entitled to designate a director pursuant to this Section fail
to designate a replacement Designated Director under this Section, the position
vacated shall remain vacant until such time as a new director is designated and
elected pursuant to the terms hereof.
Upon delivery of any written notice designating or removing one or more
directors pursuant to this Section, the parties hereto and any Transferee shall
either (i) sign a written consent, prepared for execution by the stockholders of
the Company in accordance with the Bylaws of the Company, which consent elects
or removes the director(s) designated in writing to be elected or removed in
accordance with this Section or (ii) at any annual or special shareholders
meeting at which director(s) are to be elected or removed, vote in favor of the
election or removal of the director(s) designated in writing to be elected or
removed in accordance with this Section. If necessary to fix the number of
directors constituting the entire board of directors at five (5), the parties
hereto shall either (i) sign such written consents prepared for execution by the
shareholders of the Company in accordance with the Bylaws of the Company or (ii)
at any annual or special shareholders meeting, vote in favor of such motions;
which consents or motions propose to fix the number of directors constituting
the entire board of directors at five (5).
Each of the parties hereto agrees to take such actions, and execute
such documents, agreements or instruments (including, without limitation,
consents amending the articles or bylaws of the Company), as may be necessary,
due to changes in the law or otherwise, to ensure that the provisions of this
Section 9.4 are given full effect.
9.5 Limited Waiver of Indemnity. Each party to this Agreement waives
any right to indemnification by, and agrees not to seek any indemnification
from, the Company for any act, omission or other matter (whether arising under
the Company's organizational documents or otherwise), to the extent that such
party is required by this Agreement to indemnify another party to this Agreement
in respect of such act, omission or other matter.
9.6 Post-Closing Capital Contributions. All parties to this Agreement
acknowledge and agree that no shareholder of the Company, or any other party,
has any obligation existing on the Closing Date to make a capital contribution
to the Company.
9.7 Stock Legend. On and after the Closing, each certificate or
document representing Seller's ownership of any of the Company's capital stock,
and each certificate or document that may be issued and delivered by the Company
upon transfer of such certificate, shall contain a legend conspicuously noted in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND THEY MAY
NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR OTHERWISE IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF SUCH ACT.
IN ADDITION, SHARES MAY BE TRANSFERRED ONLY IN
COMPLIANCE WITH CERTAIN CONDITIONS SPECIFIED IN A CERTAIN
STOCK PURCHASE AGREEMENT DATED EFFECTIVE AS OF SEPTEMBER 1,
1999, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE FOR
INSPECTION AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE
FURNISHED TO THE HOLDER HEREOF UPON WRITTEN REQUEST AND
WITHOUT CHARGE.
ARTICLE X
Miscellaneous
10.1 Collateral Agreements, Amendments, and Waivers. This Agreement
(together with the documents delivered pursuant hereto) supersedes all prior
documents, understandings, and agreements, oral or written, relating to this
transaction and constitutes the entire understanding among the parties with
respect to the subject matter hereof. Any modification or amendment to, or
waiver of, any provision of this Agreement (or any document delivered pursuant
to this Agreement unless otherwise expressly provided therein) may be made only
by an instrument in writing executed by each party thereto.
10.2 Successors and Assigns. No party's rights or obligations under
this Agreement may be assigned without the prior written consent of all parties
hereto, except that Prime may assign its rights and obligations hereunder to any
entity, more than 50% of the voting equity ownership interests of which is at
the time owned, directly or indirectly, by PMSI. Any assignment in violation of
the foregoing shall be null and void. Subject to the preceding sentences of this
Section, the provisions of this Agreement (and, unless otherwise expressly
provided therein, of any document delivered pursuant to this Agreement) shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors, and assigns.
10.3 Expenses. Except as set forth in the following sentence,
regardless of whether the transactions contemplated hereby are consummated, each
party hereto shall pay all of its costs and expenses incurred by it in
connection with this Agreement, including the fees and disbursements of its
legal counsel and accountants.
10.4 Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws, such provision
shall be fully severable, this Agreement shall be construed as if such illegal,
invalid, or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
10.5 Waiver. No failure or delay on the part of any party in exercising
any right, power, or privilege hereunder or under any of the documents delivered
in connection with this Agreement shall operate as a waiver of such right,
power, or privilege; nor shall any single or partial exercise of any such right,
power, or privilege preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.
10.6 Notices. Any notices required or permitted to be given under this
Agreement (and, unless otherwise expressly provided therein, under any document
delivered pursuant to this Agreement) shall be given in writing and shall be
deemed received (a) when delivered personally or by courier service to the
relevant party at its address as set forth below or (b) if sent by mail, on the
third day following the date when deposited in the United States mail, certified
or registered mail, postage prepaid, to the relevant party at its address
indicated below:
Prime: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Company: Horizon Vision Centers, Inc.
00000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Seller: Medical Vision Technology Profit Sharing Plan
FBO Xxxxxxx Xxxxxxxx, M.D.
0000 Xxxxxxx Xxxxx
Xxxxxxx Xxx, Xxxxxxxxxx 00000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
10.7 Survival of Representations, Warranties, and Covenants. Regardless
of any investigation at any time made by or on behalf of any party hereto or of
any information any party may have in respect thereof, all covenants,
agreements, representations, and warranties made hereunder or pursuant hereto or
in connection with the transactions contemplated hereby shall survive the
Closing.
10.8 Further Assurances. At, and from time to time after, the Closing,
each party shall, at the request of another party, but without further
consideration, execute and deliver such other instruments of conveyance,
assignment, assumption, transfer and delivery and take such other action as such
party may reasonably request in order more effectively to consummate the
transactions contemplated hereby.
10.9 Construction, Knowledge and Materiality. This Agreement and any
documents or instruments delivered pursuant hereto or in connection herewith
shall be construed without regard to the identity of the person who drafted the
various provisions of the same. Each and every provision of this Agreement and
such other documents and instruments shall be construed as though all of the
parties participated equally in the drafting of the same. Consequently, the
parties acknowledge and agree that any rule of construction that a document is
to be construed against the drafting party shall not be applicable either to
this Agreement or such other documents and instruments. For purposes of this
Agreement, whenever there are references to "material" or "materially," such
terms shall be deemed to mean an economic impact exceeding $10,000 with respect
to the fact or matter being referred to or described. As used herein, "day" or
"days" refers to calendar days unless otherwise specified in each instance. When
the term "knowledge" is used in this Agreement in reference to Prime, it shall
mean such items as are within the actual knowledge of Xxx Xxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxxx and Xx. Xxxxxxx.
10.10 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
10.11 Arbitration. Any controversy between the parties regarding this
Agreement and any claims arising out of this Agreement or its breach shall be
submitted to binding arbitration by either party. The arbitration proceedings
shall be conducted by a single arbitrator pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. The arbitration shall be
conducted in Dallas, Texas and the arbitrator shall have the right to award
actual damages and attorney fees and costs, but shall not have the right to
award punitive, exemplary or consequential damages against either party.
10.12 Counterparts. This Agreement may be executed in several counterparts, each
of which shall constitute an original and all of which together shall constitute
one and the same instrument. Any party hereto may execute this Agreement by
signing any one counterpart.
[Signature page follows]
SIGNATURE PAGE TO
STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Prime: Prime/BDR Acquisition, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
Printed Name: Xxxxxx Xxxxxxxx
Title: Vice President
Seller: /s/ Xxxxxxx Xxxxxxxx, M.D.
Printed Name: Xxxxxxx Xxxxxxxx, M.D.,
Trustee under the Medical Vision
Technology Profit Sharing Plan,
for the benefit of Xxxxxxx
Xxxxxxxx, M.D.
Company: Horizon Vision Center, Inc.
By: /s/ Xxxxx X. Xxxxx III
Printed Name: Xxxxx X. Xxxxx III
Title: President
TABLE OF EXHIBITS
EXHIBIT A: Form of Exclusive Use Agreement
EXHIBIT B: Form of Assignment and Security Agreement
EXHIBIT C: Form of Amended and Restated Bylaws of Seller
