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ASSET PURCHASE AGREEMENT
dated as of
April 1, 1998
by and among
AMERICAN PHYSICIAN PARTNERS, INC.
(a Delaware corporation),
TREASURE COAST IMAGING PARTNERS, INC.
(a Delaware corporation),
and
RADIOLOGY IMAGING ASSOCIATES,
BASILICO, XXXXXXXXX AND XXXXX, M.D., P.A.
(a Florida professional corporation),
and
XXXXXX X. XXXXXXXX, M.D., XXXXXX XXXXXXXXX, M.D., X.X. XXXXX, M.D.,
XXXXXX X. XXXXXXX, M.D., XXXX X. XXXXXX, M.D., and XXXXX X. XXXXXXXX, M.D.
(all individuals residing in Florida)
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2 Rules of Interpretation . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE II PURCHASE AND SALE OF ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.1 Purchased Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.2 Excluded Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.3 Subsequent Actions . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE III ASSUMED LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.1 Assumed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE IV PURCHASE PRICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.1 Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.2 Closing and Effective Time . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.3 Closing Deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 4.4 Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE V REPRESENTATIONS AND WARRANTIES OF SELLER AND
PRINCIPAL STOCKHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 5.1 Organization and Good Standing; Qualification . . . . . . . . . . . . 7
Section 5.2 Authorization and Validity . . . . . . . . . . . . . . . . . . . . . . 7
Section 5.3 Title to Purchased Assets . . . . . . . . . . . . . . . . . . . . . . 8
Section 5.4 Condition of Tangible Assets . . . . . . . . . . . . . . . . . . . . . 8
Section 5.5 Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 5.6 Governmental Authorization . . . . . . . . . . . . . . . . . . . . . . 8
Section 5.7 Continuity of Business Enterprise . . . . . . . . . . . . . . . . . . 8
Section 5.8 Subsidiaries and Investments . . . . . . . . . . . . . . . . . . . . . 8
Section 5.9 Absence of Conflicting Agreements or Required Consents . . . . . . . . 8
Section 5.10 Seller Financial Statements . . . . . . . . . . . . . . . . . . . . . 9
Section 5.11 Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5.12 Litigation and Claims . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5.13 No Violation of Law . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 5.14 Contracts and Commitments . . . . . . . . . . . . . . . . . . . . . . 10
Section 5.15 No Brokers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 5.16 No Other Agreements to Sell the Assets of the Business . . . . . . . . 11
Section 5.17 Employee Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 5.18 Labor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 5.19 Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 5.20 Lease Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 5.21 Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 5.22 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 5.23 Filing Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 5.24 Insurance Policies . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 5.25 Accounts Receivable; Payors . . . . . . . . . . . . . . . . . . . . . 16
Section 5.26 Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
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Section 5.27 Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 5.28 Licenses, Authorization and Provider Programs . . . . . . . . . . . . 16
Section 5.29 Inspections and Investigations . . . . . . . . . . . . . . . . . . . . 17
Section 5.30 Proprietary Rights and Information . . . . . . . . . . . . . . . . . . 18
Section 5.31 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 5.32 Related Party Arrangements . . . . . . . . . . . . . . . . . . . . . . 19
Section 5.33 Banking Relations . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.34 Fraud and Abuse and Self Referral . . . . . . . . . . . . . . . . . . 20
Section 5.35 Restrictions on Business Activities . . . . . . . . . . . . . . . . . 20
Section 5.36 Agreements in Full Force and Effect . . . . . . . . . . . . . . . . . 20
Section 5.37 Statements True and Correct . . . . . . . . . . . . . . . . . . . . . 20
Section 5.38 Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.39 Finders' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF BUYER AND APPM . . . . . . . . . . . . . . . . . . . 21
Section 6.1 Organization and Good Standing; Qualification . . . . . . . . . . . . 21
Section 6.2 Authorization and Validity . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.3 Governmental Authorization . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.4 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 6.5 Absence of Conflicting Agreements or Required Consents . . . . . . . . 21
Section 6.6 Statements True and Correct . . . . . . . . . . . . . . . . . . . . . 22
Section 6.7 Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 6.8 Finders' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE VII INTENTIONALLY OMITTED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE VIII INTENTIONALLY OMITTED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE IX INTENTIONALLY OMITTED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE X INTENTIONALLY OMITTED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE XI CLOSING DELIVERIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 11.1 Deliveries of Seller . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 11.2 Deliveries of APPM . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE XII INTENTIONALLY OMITTED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE XIII POST CLOSING MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 13.1 Further Instruments of Transfer . . . . . . . . . . . . . . . . . . . 24
Section 13.2 Certain Prorations . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 13.3 Certain Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 13.4 Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 13.5 Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 13.6 Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE XIV REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 14.1 Indemnification by Seller . . . . . . . . . . . . . . . . . . . . . . 25
Section 14.2 Indemnification by APPM and Buyer . . . . . . . . . . . . . . . . . . 25
Section 14.3 Conditions of Indemnification . . . . . . . . . . . . . . . . . . . . 26
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Section 14.4 Remedies Not Exclusive . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 14.5 Costs, Expenses and Legal Fees . . . . . . . . . . . . . . . . . . . . 28
Section 14.6 Tax Benefits; Insurance Proceeds . . . . . . . . . . . . . . . . . . . 28
Section 14.7 Commencing Actions . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE XV INTENTIONALLY OMITTED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE XVI NONDISCLOSURE OF CONFIDENTIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . 28
Section 16.1 Non-Disclosure Covenant . . . . . . . . . . . . . . . . . . . . . . . 28
Section 16.2 Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 16.3 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE XVII MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 17.1 Amendment; Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 17.2 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 17.3 Parties in Interest; No Third Party Beneficiaries . . . . . . . . . . 29
Section 17.4 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 17.5 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 17.6 Survival of Representations, Warranties, Covenants
and Indemnifications . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 17.7 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 17.8 Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 17.9 Gender and Number . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 17.10 Reference to Agreement . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 17.11 Confidentiality; Publicity and Disclosures . . . . . . . . . . . . . . 30
Section 17.12 Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 17.13 No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 17.14 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 17.15 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
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SCHEDULES
Schedule 2.1(a) Leasehold Improvements
Schedule 2.1(b) Personal Property
Schedule 2.1(d)(i) Intellectual Property
Schedule 2.1(d)(iii) Governmental Licenses and Permits
Schedule 2.1(d)(vi) Prepaids
Schedule 2.1(d)(viii) Interest in Other Entities, Joint Ventures
Schedule 2.1(d)(ix) Warranties, Guarantees and Covenants
Schedule 2.1(e) Purchased Contracts
Schedule 2.2 Excluded Assets
Schedule 3.1 Assumed Liabilities
Schedule 4.1 Allocation of Purchase Price
Schedule 5.3(a) Encumbrances
Schedule 5.3(b) Permitted Encumbrances
Schedule 5.4 Condition of Tangible Assets
Schedule 5.5 Consents and Approvals
Schedule 5.6 Governmental Authorizations
Schedule 5.7 Sale, Distribution or Spin-Off of Assets
Schedule 5.8 Subsidiaries and Investments
Schedule 5.9 Conflicting Agreements or Required Consents
Schedule 5.10 Seller Financial Statements
Schedule 5.12 Litigation and Claims
Schedule 5.14 Contracts and Commitments
Schedule 5.17(a) Employment Contracts
Schedule 5.17(b) Employees Earning Over $50,000
Schedule 5.17(c) Severance Arrangements
Schedule 5.18(a) Employees Terminating Employment
Schedule 5.18(b) Unfair Labor Practice Complaints
Schedule 5.18(c) Discrimination Charges, Investigations, Proceedings
or Complaints; Governmental Audits
Schedule 5.18(d) Inquiries, Investigations or Monitoring of
Professional Personnel
Schedule 5.19(a) Employee Benefit Plans
Schedule 5.19(c) Audits, Investigations, etc., of Employee Benefit
Plans
Schedule 5.19(e) Pending or Threatened Claims Against Employee
Benefit Plans
Schedule 5.19(g) Funding Status
Schedule 5.19(l) Other Compensation Arrangements
Schedule 5.20 Lease Agreements
Schedule 5.22(b) Asbestos
Schedule 5.22(d) Environmental Audits
Schedule 5.24 Insurance Policies
Schedule 5.25(a) Accounts Receivable Aging
Schedule 5.25(b) Certain Payors
Schedule 5.26(b) Certain Providers/Suppliers
Schedule 5.28(a) Licenses; Permits; Authorizations; Provider Agreements
Schedule 5.28(b) Cost Reports
Schedule 5.29 Inspections and Investigations
Schedule 5.30(a) Proprietary Rights and Information
Schedule 5.30(b) Proprietary Rights and Information - Technology
Agreements
Schedule 5.30(c) Proprietary Rights and Information - Required Consents
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Schedule 5.31(b) Taxes - Disputes
Schedule 5.31(c) Notices and Threats of Tax Deficiency or Delinquency
Schedule 5.32 Related Party Arrangements
Schedule 5.33 Banking Relations
Schedule 5.35 Restrictions on Business Activities
Schedule 5.39 Finders' Fees
Schedule 6.3 Governmental Authorization
Schedule 6.5 Conflicting Agreements; Required Consents
Schedule 13.2(a) Prorated Items
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement"), dated as of April 1,
1998, is by and among AMERICAN PHYSICIAN PARTNERS, INC., a Delaware corporation
("APPM"), Treasure Coast Imaging Partners, Inc., a Delaware corporation and a
wholly-owned subsidiary of APPM ("Buyer"), and Radiology Imaging Associates,
Basilico, Xxxxxxxxx and Xxxxx, M.D., P.A., a Florida professional corporation
(referred to herein as "RIA" and the "Seller"), and Xxxxxx X. Xxxxxxxx, M.D.,
Xxxxxx Xxxxxxxxx, M.D., X.X. Xxxxx, M.D., Xxxxxx X. Xxxxxxx, M.D., Xxxx X.
Xxxxxx, M.D., and Xxxxx X. Xxxxxxxx, M.D. (collectively, the "Principal
Stockholders").
RECITALS
A. The Seller owns and operates a professional medical practice
specializing in radiology (the "Business").
B. The Principal Stockholders own all of the issued and
outstanding capital stock and membership interests of RIA.
C. Buyer is a wholly-owned subsidiary of APPM. APPM is engaged
in the business of owning, operating and acquiring the assets of, and managing
the non-medical aspects of, radiology practices and diagnostic imaging centers.
D. Buyer desires to purchase from Seller, and Seller desires to
sell to Buyer, certain of the assets and other rights related to the Business
(which assets and rights are defined in Section 2.1 as the "Purchased Assets"),
on the terms and conditions in this Agreement.
E. The Principal Stockholders acknowledge that they have received
adequate consideration for entering into this Agreement and performing their
obligations under this Agreement, and that they will be benefitted by the
transactions contemplated by this Agreement. The Principal Stockholders
acknowledge that APPM and Buyer have relied on the Principal Stockholders'
participation in this Agreement in connection with APPM's and Buyer's entering
into this Agreement and consummating the transactions provided for in this
Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the preceding recitals and the
mutual representations, warranties, covenants and agreements set forth herein,
the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. As used in this Agreement, the
following terms shall have the meanings set forth below:
"Affiliate" with respect to any person shall mean a person that,
directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such person.
"Agreement" shall have the meaning set forth in the preamble to this
Agreement.
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"APPM" shall have the meaning set forth in the preamble to this
Agreement.
"Best knowledge" or "to the knowledge of" and similar phrases shall
mean (i) in the case of a natural person, the particular fact was known, or not
known, as the context requires, to such person after diligent investigation and
inquiry by such person, and (ii) in the case of an entity, the particular fact
was known, or not known, as the context requires, to any Principal Stockholder,
director or executive officer of such entity after diligent investigation and
inquiry by the executive officers of such entity.
"Buyer" shall have the meaning set forth in the preamble to this
Agreement.
"Claim Notice" shall have the meaning set forth in Section 14.3(a).
"Closing Date" shall have the meaning set forth in Section 4.2.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Confidential Information" shall mean all trade secrets and other
confidential and/or proprietary information of the particular Person,
including, but not limited to, information derived from reports, processes,
data, know-how, software programs, improvements, inventions, strategies,
compensation structures, reports, investigations, research, work in progress,
codes, marketing and sales programs and plans, financial projections, cost
summaries, formulae, contract analyses, financial information, forecasts,
confidential filings with any state or federal agency, and all other
confidential concepts, methods of doing business, ideas, materials or
information prepared or performed for, by or on behalf of such Person by its
employees, officers, directors, agents, representatives, or consultants.
"Controlled Group" shall have the meaning set forth in Section
5.19(g).
"Damages" shall have the meaning set forth in Section 14.1.
"Effective Time" shall have the meaning set forth in Section 4.2.
"Election Period" shall have the meaning set forth in Section 14.3(a).
"Employee Benefit Plans" shall have the meaning set forth in Section
5.19(a).
"Encumbrance" shall mean any charge, claim, community property
interest, condition, equitable interest, lien, option, pledge, security
interest, right of first refusal, or restriction of any kind, including any
restriction on use, voting, transfer, receipt of income or exercise of any
other attribute of ownership.
"Environmental Laws" shall have the meaning set forth in Section
5.22(e).
"ERISA" shall have the meaning set forth in Section 5.17(a).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Excluded Assets" shall have the meaning set forth in Section 2.2.
"Indemnified Party" shall have the meaning set forth in Section
14.3(a).
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"Indemnifying Party" shall have the meaning set forth in Section
14.3(a).
"Indemnity Notice" shall have the meaning set forth in Section
14.3(d).
"Insurance Policies" shall have the meaning set forth in Section 5.24.
"IRS" shall mean the Internal Revenue Service.
"Lease Assignments" shall have the meaning set forth in Section
11.1(k).
"Lease Agreements" shall have the meaning set forth in Section 5.20.
"Material Adverse Effect" shall mean a material adverse effect on the
assets, properties, business, operations, condition (financial or otherwise),
liabilities or results of operations of the Person or Persons being referred
to, taken as a whole, in consideration of all relevant facts and circumstances.
"Medical Waste" shall mean (i) pathological waste; (ii) blood; (iii)
sharps; (iv) wastes from surgery or autopsy; (v) dialysis waste, including
contaminated disposable equipment and supplies; (vi) cultures and stocks of
infectious agents and associated biological agents; (vii) contaminated animals;
(viii) isolation wastes; (ix) contaminated equipment; (x) laboratory waste;
(xi) any substance, pollutant, material, or contaminant listed or regulated
under any Medical Waste Law; and (xii) other biological waste and discarded
materials contaminated with or exposed to blood, excretion, or secretions from
human beings or animals.
"Medical Waste Laws" shall mean the following, including regulations
promulgated and orders issued thereunder, as in effect of the date hereof: (i)
the MWTA; (ii) the U.S. Public Vessel Medical Waste Anti-Dumping Act of 1988,
33 USCA Section 2501 et seq.; (iii) the Marine Protection, Research, and
Sanctuaries Act of 1972, 33 USCA Section 1401 et seq.; (iv) The Occupational
Safety and Health Act, 29 USCA Section 651 et seq.; (v) the United States
Department of Health and Human Services, National Institute for Occupational
Safety and Health, Infectious Waste Disposal Guidelines, Publication No.
88-119; and (vi) any other federal, state, regional, county, municipal, or
other local laws, regulations, and ordinances insofar as they are applicable to
Seller's assets or operations and purport to regulate Medical Waste or impose
requirements related to Medical Waste.
"MWTA" shall mean the Medical Waste Tracking Act of 1988, 42 U.S.C.
Section 6992, et seq.
"Ordinary course of business" shall mean the usual and customary way
in which the particular entity has conducted its business in the past.
"Other Agreements" shall have the meaning set forth in Section
11.1(b).
"Payors" shall mean any and all third-party payors including, but not
limited to, Medicare and Medicaid Programs (as defined in Section 5.28),
insurance companies, health maintenance organizations, preferred provider
organizations, independent practice associations, hospitals, hospital systems,
integrated delivery systems, CHAMPUS, and any and all other private or
governmental entity rendering payment to Seller for professional medical or
technical services.
"Person" shall mean any natural person, corporation, partnership,
joint venture, limited liability company, association, group, organization or
other entity.
"Physician Employee" shall mean each radiologist employed by Seller.
"Purchased Assets" shall have the meaning set forth in Section 2.1.
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"Principal Stockholders" shall have the meaning set forth in the
preamble to this Agreement.
"Regulated Activity" shall have the meaning set forth in Section
5.22(e).
"RIA" shall have the meaning set forth in the preamble to this
Agreement.
"Schedules" shall mean the schedules attached hereto as of the date
hereof or otherwise delivered by any party hereto pursuant to the terms hereof,
as such may be amended or supplemented from time to time pursuant to the
provisions hereof.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Seller" shall have the meaning set forth in the preamble to this
Agreement.
"Seller Current Balance Sheet" shall have the meaning set forth in
Section 5.10.
"Seller Current Financial Statements" shall have the meaning set forth
in Section 5.10.
"Seller Financial Statements" shall have the meaning set forth in
Section 5.10.
"Seller Subsidiary" shall have the meaning set forth in Section 5.8.
"Tax Returns" shall include all federal, state, local or foreign
income, excise, corporate, franchise, property, sales, use, payroll,
withholding, provider, environmental, duties, value added and other tax returns
(including information returns).
"Third Party Claim" shall have the meaning set forth in Section
14.3(a).
Section 1.2 Rules of Interpretation. The definitions set forth
in Section 1.1 shall be equally applicable to both the singular and the plural
forms of the terms therein defined and shall cover both genders.
Unless otherwise indicated "herein," "hereby," "hereunder," "hereof,"
"hereinabove," "hereinafter" and other equivalent words refer to this Agreement
and not solely to the particular Article, Section or subdivision hereof in
which such word is used.
This Agreement occasionally omits the modifying words "all" and "any"
and the articles "the" and "an," but the fact that a modifier or an article is
absent from one statement and appears in another is not intended to affect the
interpretation of either statement.
Unless otherwise indicated, reference herein to an Article number
(e.g., Article IV) or a Section number (e.g., Section 6.2) shall be construed
to be a reference to the designated Article number or Section number of this
Agreement.
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ARTICLE II
PURCHASE AND SALE OF ASSETS
Section 1.3 Purchased Assets. Seller hereby sells, assigns,
transfers, conveys and delivers to Buyer, and Buyer hereby purchases, all
right, title and interest of Seller in and to the following assets, rights and
interests used in the operation of the Business, of every kind and description,
wherever located, whether tangible or intangible, real, personal or mixed,
excluding the Excluded Assets (as such term is defined in Section 2.2 below,
including, without limitation, the following assets, rights and interests
(collectively, the "Purchased Assets"):
(1) Intentionally Omitted;
(2) Personal Property. All tangible personal property
(collectively, the "Personal Property") of every kind and nature (other than
items of tangible personal property that are consumed, disposed of or held for
sale or are inventoried in the ordinary course of business), including, without
limitation, all furniture, fixtures, machinery, vehicles, owned or licensed
computer systems, and equipment, including, without limitation, the Personal
Property listed in Schedule 2.1(b) hereto;
(3) Intentionally Omitted;
(4) Intangible Assets. All of the following intangible
property (collectively, the "Intangible Assets"):
(1) Intentionally Omitted;
(2) Intentionally Omitted;
(3) Intentionally Omitted;
(4) Intentionally Omitted;
(5) Intentionally Omitted;
(6) Intentionally Omitted;
(7) Seller's goodwill associated with the
Purchased Assets;
(8) Intentionally Omitted;
(9) to the extent assignable, all warranties and
guarantees with respect to the Purchased Assets;
(5) Intentionally Omitted;
(6) Intentionally Omitted;
(7) Accounts Receivable. Accounts receivable of Seller
arising on or before the Closing Date (provided, however, that notwithstanding
anything to the contrary herein, Seller shall not sell to Buyer any of Seller's
Medicare or Medicaid accounts receivable as of December 31, 1997 (the "Medicare
Receivables"), but Seller shall irrevocably retain Buyer to collect on Seller's
behalf such Medicare Receivables, and which,
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immediately following the collection of such Medicare Receivables, as such
collection may occur from time to time, Seller shall immediately deliver to
Buyer the proceeds of such Medicare Receivable collections); and
(8) Intentionally Omitted.
Section 1.4 Excluded Assets. The "Purchased Assets" shall
exclude all assets, rights and interests not described in Section 2.1 above,
including, but not limited to, the teleradiology equipment located at the
Principal Stockholders' residences (collectively, the "Excluded Assets"). The
Excluded Assets shall not be transferred by Seller to Buyer.
Section 1.5 Subsequent Actions. If, at any time after the
Effective Time, APPM or Buyer shall consider or be advised that any deeds,
bills of sale, assignments, assurances or any other actions or things are
necessary or desirable to vest, perfect or confirm of record or otherwise in
APPM or Buyer its right, title or interest in, to or under any of the Purchased
Assets or otherwise to carry out the transactions described in this Agreement,
Seller shall, at the sole cost and expense of Seller, execute and deliver all
such deeds, bills of sale, assignments and assurances and to take and do all
such other actions and things as may be necessary or desirable to vest, perfect
or confirm any and all right, title and interest in, to and under the Purchased
Assets or otherwise to carry out the transactions described in this Agreement.
ARTICLE III
ASSUMED LIABILITIES
Section 1.6 Assumed Liabilities. Buyer shall assume no
liabilities whatsoever of Seller.
ARTICLE IV
PURCHASE PRICE
Section 1.7 Purchase Price.
(1) Purchase Price. Subject to the terms and conditions
herein, in consideration for the sale, transfer, assignment, conveyance and
delivery of the Purchased Assets from Seller to Buyer, Buyer hereby delivers
the following ("Purchase Price"):
(i) Six Hundred Twenty-Three Thousand One Hundred
Eighty-Four and 00/100 Dollars ($623,184.00)
by wire transfer of immediately available
funds to one or more accounts designated in
writing by Seller.
(ii) Intentionally Omitted.
(iii) Intentionally Omitted.
(2) Allocation of Purchase Price. The Purchase Price
shall be allocated by Buyer and Seller in accordance with Schedule 4.1(b)
hereto.
Section 1.8 Closing and Effective Time. The closing of the
transactions contemplated under this Agreement shall take place at the offices
of APPM, Dallas, Texas at 10:00 a.m. local time on April 2, 1998 (the "Closing
Date").
The transfer of the Purchased Assets by Seller to Buyer and Buyer's
assumption of the Assumed Liabilities shall be deemed effective as of 12:01
a.m. on April 1, 1998 (the "Effective Time"). The obligations
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and proceeds from the operations of the Business shall be deemed to be the
property of Buyer from and after the Effective Time, and Buyer and Seller shall
take any and all actions reasonably necessary to carry out the intent of this
Section 4.2.
Section 1.9 Closing Deliveries.
(1) Seller. Simultaneously with the execution and
delivery of this Agreement, Seller hereby executes and delivers to Buyer: (i) a
Xxxx of Sale substantially in the form attached as Exhibit A hereto ("Xxxx of
Sale"); and (ii) the documents required to be delivered pursuant to Section
11.1 hereof.
(2) Buyer. Simultaneously with the execution and
delivery of this Agreement, Buyer hereby delivers to Seller: (i) the cash
portion of the Purchase Price; and (ii) the documents required to be delivered
pursuant to Section 11.2 hereof.
Section 1.10 Intentionally Omitted.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SELLER AND PRINCIPAL STOCKHOLDERS
As an inducement to APPM and to Buyer to enter into this Agreement,
Seller and each Principal Stockholder jointly and severally (subject to the
terms and conditions hereof) represent and warrant to APPM and to Buyer as of
the date hereof.
Section 1.11 Organization and Good Standing; Qualification. RIA
is a professional corporation duly organized, validly existing and in good
standing under the laws of its state of incorporation, with all requisite
corporate power and authority to own, operate and lease its assets and
properties and to carry on its business as currently conducted and as now
contemplated, to execute and deliver this Agreement and to consummate the
transactions contemplated by this Agreement. Seller and each Seller Subsidiary
do not transact business outside the State of Florida and accordingly are not
qualified to do business as a foreign corporation in any other jurisdiction.
The Principal Stockholders own all of the issued and outstanding capital stock
and membership interests of RIA.
Each Principal Stockholder has full requisite power, authority and
capacity to execute, deliver and perform this Agreement. No Principal
Stockholder is aware of any defect (or facts that might be deemed to constitute
such a defect) in any other Principal Stockholder's power, authority or
capacity that could impair the enforceability of this Agreement and the
applicable Other Agreements against any other Principal Stockholder. The
Agreement has been duly executed and delivered by each Principal Stockholder
and constitutes the legal, valid and binding obligations of each Principal
Stockholder, enforceable against them in accordance with its terms.
Section 1.12 Authorization and Validity. Seller has all requisite
corporate power to enter into this Agreement and all other agreements entered
into in connection with the transactions contemplated hereby and to consummate
the transactions contemplated hereby. The execution, delivery and, subject to
approval of this Agreement by the Principal Stockholders, performance by Seller
of this Agreement and the agreements contemplated herein, and the consummation
by Seller of the transactions contemplated hereby and thereby are within
Seller's respective corporate powers and have been duly authorized by all
necessary action on the part of Seller's Boards of Directors. This Agreement
has been duly executed by Seller, and this Agreement and all other agreements
and obligations entered into and undertaken in connection with the transactions
contemplated hereby to which Seller is a party constitute, or upon execution
will constitute, valid and binding agreements of Seller, enforceable against it
in accordance with their respective terms, except as enforceability may be
limited by
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bankruptcy or other laws affecting the enforcement of creditors' rights
generally, or by general equity principles, or by public policy.
Section 1.13 Title to Purchased Assets.
(1) Schedule 5.3(a) hereto sets forth a true, correct and
complete list of the Purchased Assets;
(2) Seller has good, clear, record and marketable title
to, all of the Purchased Assets, free and clear of all claims, liabilities,
liens, pledges, options, charges, adverse claims, leases, licenses, rights to
use or occupancy, security interests, restrictions and encumbrances of any kind
affecting the Purchased Assets (collectively, the "Encumbrances"); and
(3) Seller has good, clear, record and marketable title
to, or valid leasehold interests in, all of the Purchased Assets, free and
clear of all Encumbrances, except as set forth in Schedule 5.3(b) hereto (the
"Permitted Encumbrances"), and, subject to the Permitted Encumbrances, Seller
has full power and right to sell, assign and deliver the Purchased Assets in
accordance with the terms of this Agreement. The delivery to Buyer of the
instruments of transfer of ownership contemplated by this Agreement shall vest
valid and marketable title to the Purchased Assets in Buyer, free and clear of
all Encumbrances.
Section 1.14 Condition of Tangible Assets. Except as set forth on
Schedule 5.4, the tangible Personal Property and any other tangible Purchased
Assets are in reasonable operating condition and are sufficient for the
operation of the Business as presently conducted and are in conformity in all
material respects with all applicable laws, ordinances, orders, regulations and
other requirements (including, without limitation, applicable occupational
safety and health laws and regulations) relating thereto currently in effect.
Section 1.15 Consents and Approvals. Except as set forth on
Schedule 5.5, no consent, approval or authorization of, notice to, or
declaration, filing or registration with, any governmental entity or any other
Person is required to be made or obtained by Seller in connection with its
execution, delivery and performance of this Agreement and its consummation of
the transactions contemplated hereby.
Section 1.16 Governmental Authorization. Except as set forth in
Schedule 5.6, and other than consents, filings or notifications required to be
made or obtained by Buyer or APPM, the execution, delivery and performance by
Seller of this Agreement and the agreements provided for herein, and the
consummation of the transactions contemplated hereby and thereby by Seller
require no action by or in respect of, or filing with, any governmental body,
agency, official or authority.
Section 1.17 Continuity of Business Enterprise. Except as set
forth in Schedule 5.7, there has not been any sale, distribution or spin-off of
significant assets of Seller other than in the ordinary course of business
within the two (2) years preceding the date of this Agreement.
Section 1.18 Subsidiaries and Investments. Except as set forth in
Schedule 5.8, Seller does not own, directly or indirectly, any capital stock or
other equity, ownership or proprietary interest in any corporation,
partnership, association, trust, joint venture or other entity (each a "Seller
Subsidiary").
Section 1.19 Absence of Conflicting Agreements or Required
Consents. The execution, delivery and performance by Seller of this Agreement
and any other documents contemplated hereby (with or without the giving of
notice, the lapse of time, or both): (i) except as set forth in Schedule 5.6
and Schedule 5.9 hereto, does not require the consent of any governmental or
regulatory body or authority or any other third party; (ii) will not conflict
with or result in a violation of any provision of Seller's articles or
certificate of incorporation or bylaws;
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(iii) will not conflict with, result in a violation of, or constitute a default
under any law, rule, ordinance, regulation or any ruling, decree,
determination, award, judgment, order or injunction of any court or
governmental instrumentality which is applicable to Seller or by which Seller
or its properties are subject to or bound; (iv) except as set forth in Schedule
5.9, will not conflict with, constitute grounds for termination of, result in a
breach of, constitute a default under, require any notice under, or accelerate
or modify, or permit any person to accelerate or modify, any performance
required by the terms of any agreement, instrument, license or permit, to which
Seller is a party or by which Seller or any of its properties are subject to or
bound; and (v) will not create any Encumbrance or restriction upon any of the
Purchased Assets.
Section 1.20 Seller Financial Statements. Attached hereto as
Schedule 5.10 are (i) the consolidated balance sheet of Seller as of December
31, 1997, and the related statements of income, Principal Stockholders' equity
and statements of cash flows of Seller and Seller Subsidiaries for the year
ended December 31, 1997 (collectively, the "Seller Financial Statements"); and
(ii) the unaudited consolidated balance sheet of Seller and Seller Subsidiaries
as of February 28, 1998 (the "Seller Current Balance Sheet") and the related
statements of income, Principal Stockholders' equity and statements of cash
flows of Seller and Seller Subsidiaries for the two (2) month period ended
February 28, 1998, (collectively, the "Seller Current Financial Statements").
Seller Financial Statements and Seller Current Financial Statements are
sometimes collectively referred to herein as the "Seller Financial Statements."
Seller Financial Statements (a) have been prepared in accordance with generally
accepted accounting principles consistently applied (except as may be indicated
therein or in the notes thereto); (b) present fairly the financial position of
Seller as of the dates indicated and present fairly the results of Seller's
operations for the periods then ended; and (c) are in accordance with the books
and records of Seller, which have been properly maintained and are complete and
correct in all material respects. Seller Current Financial Statements present
fairly the financial position of Seller and Seller Subsidiaries as at the dates
thereof and the results of its operations and changes in financial position for
the periods then ended, subject to normal year-end audit adjustments (the
effect of which will not individually or in the aggregate result in a Material
Adverse Effect on Seller) and lack of footnotes thereto.
Section 1.21 Intentionally Omitted.
Section 1.22 Litigation and Claims. Except as listed in Schedule
5.12 hereto, there are no claims, lawsuits, actions, arbitrations,
administrative or other proceedings, governmental investigations or inquiries
pending, or affecting, or to the knowledge of Seller threatened against, or
affecting Seller, any Seller Subsidiary, any Principal Stockholder, the
Physician Employees or any other licensed professional or other individual
affiliated with Seller affecting or that could affect the operations, business
condition, (financial or otherwise), or results of operations or the prospects
of Seller which (i) if successful, may, individually or in the aggregate, have
a Material Adverse Effect on Seller or (ii) could adversely affect the ability
of Seller or any Seller Subsidiary to effect the transactions contemplated
hereby, and there is no basis for any such action or any state of facts or
occurrence of any event which might give rise to the foregoing. There are no
unsatisfied judgments against Seller or any Seller Subsidiary or any licensed
professional or other individual affiliated with Seller or any Seller
Subsidiary relating to services provided by or on behalf of Seller or any
Seller Subsidiary or any consent decrees to which any of the foregoing is
subject. Except as set forth in Schedule 5.12, each of the matters, if any,
set forth in Schedule 5.12 is fully covered by policies of insurance of Seller
or any Seller Subsidiary as in effect on the date hereof.
Section 1.23 No Violation of Law. Neither Seller nor any Seller
Subsidiary has been, nor shall be as of the date hereof (by virtue of any
action, omission to act, contract to which it is a party or any occurrence or
state of facts whatsoever), in violation of any applicable local, state or
federal law, ordinance, regulation, order, injunction or decree, or any other
requirement of any governmental body, agency, authority or court binding on it,
or relating to its properties, assets or business or its advertising, sales or
pricing practices, except for violations which, individually or in the
aggregate, would not have a Material Adverse Effect on Seller.
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Section 1.24 Contracts and Commitments.
(1) Schedule 5.14 contains a true, accurate and complete
list, and Seller has delivered to APPM true and complete copies, of each
contract, agreement and other instrument (other than insurance contracts
identified in Schedule 5.24 or Lease Agreements identified in Schedule 5.20) to
which Seller is a party or by which it or any of its properties or assets are
bound including, without limitation, (i) all agreements between Seller, on the
one hand, and any government entity, Payor, provider, hospital, health
maintenance organization, other managed care organization or other third-party
provider, on the other hand, relating to the provision of medical, diagnostic
imaging or consulting services, treatments, patient referrals or other similar
activities; (ii) all indentures, mortgages, notes, loan or credit agreements
and other agreements and obligations relating to the borrowing of money or to
the direct or indirect guarantee or assumption of obligations of third parties
requiring Seller to make, or setting forth conditions under which Seller would
be required to make, aggregate future payments in excess of $10,000 in any
fiscal year or $25,000 in the aggregate; (iii) all agreements for capital
improvements or acquisitions involving an amount of $75,000 in any fiscal year
or $75,000 in the aggregate; (iv) all agreements containing a covenant limiting
the freedom of Seller (or any Physician Employee of Seller) to compete in any
line of business with any person or entity or in any geographic area; or (v)
all written contracts and commitments to which aggregate future payments by
Seller are in excess of $10,000 in any fiscal year or $25,000 in the aggregate
and that are not cancelable by providing notice of sixty (60) days or less.
Except as noted in Schedule 5.14, all such contracts, agreements or other
instruments are in full force and effect, there has been no threatened
cancellation thereof, there are no outstanding disputes thereunder, each is
with unrelated third parties and was entered into on an arms-length basis in
the ordinary course of business and, assuming the receipt of the appropriate
consents, each constituting an Assumed Contract will continue to be binding in
accordance with their terms after consummation of the transaction contemplated
herein. Except as noted in Schedule 5.14, there are no contracts, agreements
or other instruments to which Seller is a party or is bound (other than
physician employment contracts and insurance policies) which could either
singularly or in the aggregate have a Material Adverse Effect on the value to
Buyer of the Purchased Assets, or which could inhibit or prevent Seller from
transferring to or vesting in Buyer good and sufficient title to the Purchased
Assets. For each of the Assumed Liabilities, in every instance where consent
is necessary, Seller obtained and delivered to Buyer in writing, effective as
of the date hereof, such consents as are necessary to effect a valid and
binding transfer or assignment so as to enable Buyer to enjoy all of the rights
now enjoyed by Seller under such contracts. Notwithstanding the foregoing,
Seller shall not transfer to Buyer any contracts or agreements relating to the
provision of professional medical services or other such agreements and
contracts that Buyer consents to in writing to be retained by Seller. Except
as set forth in Schedule 5.14, no contract with a health care provider or Payor
has been materially amended or terminated within the last twelve (12) months.
(2) Except as disclosed in Schedule 5.14, (i) Seller has
not received notice of any plan or intention of any other party to exercise any
right to cancel or terminate such contract, agreement or instrument, and Seller
is not aware of any fact(s) that would justify the exercise of such a right;
and (ii) Seller does not currently contemplate, or have reason to believe any
other Person currently contemplates, any amendment or change to any such
contract, agreement or instrument.
Section 1.25 No Brokers. Seller has not entered into and will not
enter into any agreement, arrangement or understanding with any person or firm
which will result in the obligation of Buyer to pay any finder's fee, brokerage
commission or similar payment.
Section 1.26 No Other Agreements to Sell the Assets of the
Business. Seller does not have any legal obligation, absolute or contingent,
to any Person to sell any of the Purchased Assets (other than agreements for
the sale of Inventory in the ordinary course), or to effect any sale of the
Business or to enter into any agreement with respect thereto.
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Section 1.27 Employee Matters.
(1) Employment Contracts. Except as set forth in
Schedule 5.17(a), Seller is not currently a party to any employment contract
(except for oral employment agreements which are terminable at will),
consulting or collective bargaining contracts, deferred compensation, pension
(as defined in Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended, and all rules and regulations from time to time promulgated
thereunder ("ERISA")), profit sharing, bonus, stock option, stock purchase or
other nonqualified benefit or compensation commitments, benefit plans,
arrangements or plans (whether written or oral), including all welfare plans
(as defined in Section 3(1) of ERISA) of or pertaining to Seller and any of its
present or former employees, or any predecessors in interest.
(2) Employees. As of February 28, 1998, Seller employed
a collective total of eight (8) full-time and part-time employees. Schedule
5.17(b) lists each employee of, or consultant to, Seller who received combined
salary, benefits and bonuses for 1997 in excess of $50,000 or who is expected
to receive combined salary, benefits and bonuses in 1998 in excess of $50,000.
Seller is not delinquent in payment to any of its employees or Physician
Employees for wages, salaries, bonuses or other direct compensation for any
services performed for it to the date hereof or amounts required to be
reimbursed to such employees.
(3) Severance Arrangements. Except as set forth on
Schedule 5.17(c), upon termination of employment of any employee or Physician
Employee, no severance or other payments will become due and Seller has no
policy, past practice or plan of paying severance on termination of employment.
Section 1.28 Labor Relations.
(1) Except as set forth on Schedule 5.18(a), to the
knowledge of Seller, no executive, key employee or group of employees has any
plans to terminate employment with Seller, except by reason of terminating such
relationship by becoming an employee of Buyer in connection with Buyer's
purchase of the Business pursuant hereto.
(2) Except as set forth in Schedule 5.18(b), there is no
unfair labor practice, charge or complaint or any other employment-related
matter against or involving Seller pending or threatened before the National
Labor Relations Board or any federal, state or local agency, authority or
court.
(3) Except as set forth in Schedule 5.18(c), there are no
charges, investigations, administrative proceedings or formal complaints of
discrimination (including discrimination based upon sex, age, marital status,
race, national origin, the making of workers' compensation claims, sexual
preference, handicap or veteran status) pending or threatened before the Equal
Employment Opportunity Commission or any federal, state or local agency,
authority or court against Seller. There have been no governmental audits of
the equal employment opportunity practices of Seller and no basis for any such
audit exists which, if conducted would result in a Material Adverse Effect on
Seller.
(4) Except as set forth in Schedule 5.18(d), there are no
inquiries, investigations or monitoring activities of any licensed, registered,
or certified professional personnel employed or retained by, credentialed or
privileged, or otherwise affiliated with Seller pending or threatened by any
state professional board or agency charged with regulating the professional
activities of health care practitioners.
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Section 1.29 Employee Benefit Plans.
(1) Identification. Schedule 5.19(a) contains a complete
and accurate list of all employee benefit plans (within the meaning of Section
3(3) of ERISA) sponsored by Seller or to which Seller contributes on behalf of
its employees and all employee benefit plans previously sponsored or
contributed to on behalf of its employees within the three years preceding the
date hereof (the "Employee Benefit Plans"). Seller has provided to Buyer
copies of all plan documents (as they may have been amended to the date
hereof), determination letters, pending determination letter applications,
trust instruments, insurance contracts or policies related to an Employee
Benefit Plan, administrative services contracts, annual reports, actuarial
valuations, summary plan descriptions, summaries of material modifications,
administrative forms and other documents that constitute a part of or are
incident to the administration of the Employee Benefit Plans. In addition,
Seller has provided or made available to Buyer a written description of all
existing practices engaged in by Seller that constitute Employee Benefit Plans.
Except as set forth in Schedule 5.19(a), subject to the requirements of ERISA,
each of the Employee Benefit Plans can be terminated or amended at will by
Seller without any further liability or obligation on the part of such entity
to make further contributions or payments in connection therewith following
such termination. Except as set forth in Schedule 5.19(a), no unwritten
amendment exists with respect to any Employee Benefit Plan.
(2) Administration. Each Employee Benefit Plan has been
administered and maintained in compliance with all applicable laws, rules and
regulations, except where the failure to be in compliance would not,
individually or in the aggregate, result in a Material Adverse Effect to
Seller.
(3) Examinations. Except as set forth in Schedule
5.19(c), Seller has not received any notice that any Employee Benefit Plan is
currently the subject of an audit, investigation, enforcement action or other
similar proceeding conducted by any state or federal agency or authority.
(4) Prohibited Transactions. No prohibited transactions
(within the meaning of Section 4975 of the Code or Section 406 of ERISA) have
occurred with respect to any Employee Benefit Plan. There has been no breach
of any duty under ERISA or applicable law (including, without limitation, any
health care contractor requirements or any other tax law requirements, or
conditions to favorable tax treatment, applicable to such plan), which could
result, directly or indirectly, (including through any obligation of
indemnification or contribution), in any taxes, penalties or other liability to
Seller, APPM or any of their respective Affiliates.
(5) Claims and Litigation. Except as set forth in
Schedule 5.19(e), no pending or threatened claims, suits or other proceedings
exist with respect to any Employee Benefit Plan other than normal benefit
claims filed by participants or beneficiaries.
(6) Qualification. Seller has received a favorable
determination letter or ruling from the IRS for each of the Employee Benefit
Plans intended to be qualified within the meaning of Section 401(a) or
501(c)(9) of the Code and/or tax-exempt within the meaning of Section 501(a) of
the Code and, to the best knowledge of Seller and each Principal Stockholder,
has been continually qualified under the applicable section of the Code since
the effective date of such Employee Benefit Plan. No proceedings exist or have
been threatened that could result in the revocation of any such favorable
determination letter or ruling.
(7) Funding Status. Except as set forth in Schedule
5.19(g), no accumulated funding deficiency (within the meaning of Section 412
of the Code), whether waived or unwaived, exists with respect to any Employee
Benefit Plan or any plan sponsored by any member of a controlled group (within
the meaning of Section 412(n)(6)(B) of the Code) in which Seller is a member (a
"Controlled Group"). Except as set forth in Schedule 5.19(g), with respect to
each Employee Benefit Plan subject to Title IV of ERISA, the assets of each
such plan are at least equal in value to the present value of accrued benefits
determined on an ongoing basis as of the date hereof. With respect to each
Employee Benefit Plan described in Section 501(c)(9) of the Code, the assets of
each such plan are at least equal in value to the present value of accrued
benefits, based upon the most
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recent actuarial valuation as of a date no more than ninety (90) days prior to
the date hereof. Schedule 5.19(g) contains a complete and accurate statement
of all actuarial assumptions applied to determine the present value of accrued
benefits under all Employee Benefit Plans subject to actuarial assumptions.
(8) Excise Taxes. Neither Seller nor any member of a
Controlled Group has any liability to pay excise taxes with respect to any
Employee Benefit Plan under applicable provisions of the Code or ERISA.
(9) Multiemployer Plans. Neither Seller nor any member
of a Controlled Group is or ever has been obligated to contribute to a
multiemployer plan within the meaning of Section 3(37) of ERISA or any other
Employee Benefit Plan which has been subject to Title IV of ERISA or Section
412 of the Code.
(10) PBGC. No facts or circumstances exist that would
result in the imposition of liability against APPM, Buyer or any of its
Affiliates by the Pension Benefit Guaranty Corporation ("PBGC") as a result of
any act or omission by Seller or any member of a Controlled Group. No
reportable event (within the meaning of Section 4043 of ERISA) for which the
notice requirement has not been waived has occurred with respect to any
Employee Benefit Plan subject to the requirements of Title IV of ERISA.
(11) Retirees. Seller has no obligation or commitment to
provide medical, dental or life insurance benefits to or on behalf of any of
its employees who may retire or any of its former employees who have retired
except as may be required pursuant to the continuation of coverage provisions
of Section 4980B of the Code and the applicable provisions of ERISA.
(12) Other Compensation Arrangements. Except as set forth
in Schedule 5.19(l), neither Seller nor any Principal Stockholder or Physician
Employee of Seller is a party to any compensation or debt arrangement with any
Person relating to the provision of health care related services other than
arrangements with Seller.
Section 1.30 Lease Agreements. Schedule 5.20 contains a true,
accurate and complete list of all the lease agreements and license agreements
to which Seller or any Seller Subsidiary is a party and pursuant to which
Seller or any Seller Subsidiary leases (whether as lessor or lessee) or
licenses (whether as licensor or licensee) any real or personal property
related to the operation of its business and which requires payments in excess
of $10,000 per year (the "Lease Agreements"). Seller has delivered to Buyer
true and complete copies of all of the Lease Agreements. Each Lease Agreement
is valid, effective and in full force in accordance with its terms, and there
is not under any such lease (i) any existing or claimed material default by
Seller or any Seller Subsidiary (as applicable) or event of material default or
event which with notice or lapse of time, or both, would constitute a material
default by Seller or any Seller Subsidiary (as applicable) and, individually or
in the aggregate, result in a Material Adverse Effect on Seller; or (ii) any
existing material default by any other party under any of the Lease Agreements
or, to the knowledge of Seller, any event of material default or event which
with notice or lapse of time, or both, would constitute a material default by
any such party. There is no pending or threatened reassessment of any property
covered by the Lease Agreements. Seller or a Seller Subsidiary (as applicable)
has obtained the consent of each landlord or lessor whose consent is required
to the assignment of the Lease Agreements and has delivered to Buyer in writing
such consents as are necessary to effect a valid and binding transfer or
assignment of Seller's or any Seller Subsidiary's rights thereunder. Seller
has a good, clear, valid and enforceable leasehold interest under each of the
Lease Agreements. The Lease Agreements are in compliance with all applicable
safe harbor provisions promulgated by the Department of Health and Human
Services in connection with the enforcement of the federal Fraud and Abuse
Xxxxxxx, 00 XXX Part 1001 and any similar applicable state law safe harbor or
other exemption provisions.
Section 1.31 Intentionally Omitted.
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Section 1.32 Environmental Matters.
(1) Neither Seller nor any Seller Subsidiary has, within
the five (5) years preceding the date hereof, through the Effective Time,
received from any federal, state or local governmental body, agency, authority
or entity, or any other Person, any written notice, demand, citation, summons,
complaint or order or any notice of any penalty, lien or assessment, and no
investigation or review is pending by any governmental entity, with respect to
any (i) alleged violation by Seller of any Environmental Law (as defined in
subsection (e) below); (ii) alleged failure by Seller to have any environmental
permit, certificate, license, approval, registration or authorization required
pursuant to any Environmental Law in connection with the conduct of its
business; or (iii) alleged illegal Regulated Activity (as defined in subsection
(e) below) by Seller.
(2) Neither Seller nor any Seller Subsidiary has used,
transported, disposed of or arranged for the disposal of (as those terms are
defined in and construed under the Comprehensive Environmental Response,
Compensation and Liability Act) any Hazardous Substance (as defined herein in
subsection (e) below) that would give rise to any Environmental Liabilities (as
defined in subsection (e) below) for Seller under any applicable Environmental
Law that had, or could likely have, a Material Adverse Effect on Seller.
Neither Seller nor any Seller Subsidiary has engaged in any activity or failed
to undertake any activity which action or failure to act has given, or could
likely give, rise to any Environmental Liabilities or enforcement action by any
federal, state or local regulatory agency or authority, or has resulted, or
could likely result, in any fine or penalty imposed pursuant to any
Environmental Law. Schedule 5.22(b) discloses any known presence of asbestos
in or on Seller's or any Seller Subsidiary's owned or leased premises. There
is no friable asbestos in or on Seller's or any Seller Subsidiary's owned or
leased premises.
(3) No soil or water in or under any assets currently or
formerly held for use or sale by Seller or any Seller Subsidiary is or has been
contaminated by any Hazardous Substance while such assets or premises were
owned, leased, operated or managed, directly or indirectly by Seller or any
Seller Subsidiary where such contamination had, or could likely have, a
Material Adverse Effect on Seller.
(4) Schedule 5.22(d) contains a list of all environmental
audits and other similar reports which have been prepared by, for or concerning
Seller or any Seller Subsidiary within the five (5) years preceding the date
hereof through the Effective Time with respect to any real property now or
previously owned or leased by Seller, any Seller Subsidiary or any of their
predecessors, true and complete copies of which have been provided to Buyer.
(5) For the purposes of this Section 5.22, the following
terms have the following meanings:
"Environmental Laws" shall mean any and all domestic federal,
state and local laws (including case law), regulations, ordinances,
rules, judgments, orders, decrees, codes, injunctions and permits
relating to the environment or to emissions, discharges or releases of
Hazardous Substances into the environment or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Substances or the
clean-up or other remediation thereof.
"Environmental Liabilities" shall mean all liabilities of
Seller or any Seller Subsidiary, whether contingent or fixed, which
(i) have arisen, or could likely arise, under Environmental Laws and
(ii) relate to actions occurring or conditions existing on or prior to
the date hereof or the Effective Time.
"Hazardous Substances" shall mean any air pollution, toxic,
radioactive, caustic or otherwise hazardous substance regulated by any
Environmental Law (including, but not limited to, (i) Medical Waste
and (ii) petroleum, its derivatives, by-products and other
hydrocarbons), and any material constituent elements thereof
displaying any of the foregoing characteristics.
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"Regulated Activity" shall mean any generation, treatment,
storage, recycling, transportation, disposal or release of any
Hazardous Substances.
Section 1.33 Filing Reports. All returns, reports, plans and
filings of any kind or nature necessary to be filed by Seller with any
governmental agency or authority have been properly completed and timely filed
in compliance with all applicable requirements, except where failure to so file
would not have a Material Adverse Effect on Seller.
Section 1.34 Insurance Policies. Schedule 5.24 lists and briefly
describes Seller's policies of insurance to which Seller or any Affiliate is a
party or under which Seller or any Affiliate, officer or director thereof is or
has been covered at any time during the last five (5) years preceding the date
of this Agreement relating to the business of Seller or any of its Affiliates
(the "Insurance Policies"). Except as set forth in Schedule 5.24, all of the
Insurance Policies are issued by insurers that are financially sound and
reputable and are valid, outstanding and enforceable policies, except as may be
limited by applicable bankruptcy, insolvency or similar laws affecting
creditors' rights generally or the availability of equitable remedies and all
premiums with respect thereto are currently paid. All Insurance Policies
currently maintained by Seller or any Affiliate thereof ("Current Policies")
taken together (i) provide adequate insurance coverage for the assets,
properties and operations of Seller and its Affiliates for all risks normally
insured against by a Person carrying on a substantially similar business or
businesses as Seller and its Affiliates; (ii) are sufficient for compliance
with legal and contractual requirements to which Seller or any of its
Affiliates is a party or by which any of them may be bound; and (iii) shall be
maintained in force (including the payment of all premiums and compliance with
their terms without interruption up to and including the date hereof. True,
complete and correct copies of all Insurance Policies have been provided to
APPM. Except as set forth in Schedule 5.24, neither Seller nor any of its
Affiliates nor any officer or director thereof has received any notice or other
communication from any issuer of any Current Policy cancelling such policy,
materially increasing any deductibles or retained amounts thereunder, or
materially increasing the annual or other premiums payable thereunder and, to
the knowledge of Seller and the Principal Stockholders, no such cancellation or
increase of deductibles, retainages or premiums is threatened. Except as set
forth in Schedule 5.24, there are no outstanding claims, settlements or
premiums owed against any Insurance Policy, and all required notices have been
given and all potential or actual claims under any Insurance Policy have been
presented in due and timely fashion. Except as set forth in Schedule 5.24,
since January 1, 1993, neither Seller nor any Affiliate thereof has filed a
written application for any professional liability insurance coverage which has
been denied by an insurance agency or carrier. Schedule 5.24 also sets forth a
list of all claims under any Insurance Policy in excess of $10,000 per
occurrence filed by Seller or any Affiliate thereof during the immediately
preceding three-year period. Except as set forth in Schedule 5.24, each
Physician Employee has, at all times while a Physician Employee, maintained or
been covered by professional malpractice insurance in such types and amounts as
customary for such a physician practicing the same type of medicine in the same
geographic area.
Section 1.35 Accounts Receivable; Payors.
(1) Attached hereto as Schedule 5.25(a) is a list and
aging of all accounts receivable of Seller as of February 28, 1998, which list
is complete, true and accurate in all material respects. All such accounts
receivable arose in the ordinary course of business and have not been
previously written off as bad debts and, are, to the extent still uncollected,
collectible in the ordinary course of business, net of contractual allowances,
reserves for doubtful and uncollectible accounts shown in Seller Financial
Statements or on the accounting records of Seller (which reserves are adequate
and calculated consistent with past practice).
(2) Schedule 5.25(b) sets forth a true, correct and
complete list of the names and addresses of each Payor including, but not
limited to, all private-pay patients as a single Payor, of Seller which
accounted
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for more than 5% of the revenues of Seller in the fiscal year ended February
28, 1998, or which is reasonably expected to account for more than 5% of the
revenues of Seller for the fiscal year ended December 31, 1998. Except as set
forth in Schedule 5.25(b), Seller has satisfactory relations with such Payors
and none of such Payors has notified Seller that it intends to discontinue its
relationship with Seller or to deny any payments due from, or any claims for
payment submitted to any such party.
Section 1.36 Suppliers.
(1) Intentionally Omitted.
(2) Schedule 5.26(b) sets forth a true, correct and
complete list of the names and addresses of each of the providers/suppliers of
products or services to Seller (including, without limitation all non-Physician
Employee providers of care to patients) which accounted for a dollar volume of
purchases paid for by Seller in excess of $2,500 for the fiscal year ended
December 31, 1997, or which is reasonably expected to account for a dollar
volume of purchases paid for by Seller in excess of $2,500 for the fiscal year
ended December 31, 1998.
Section 1.37 Intentionally Omitted.
Section 1.38 Licenses, Authorization and Provider Programs.
(1) Except as listed in Schedule 5.28(a), Seller, and
each Physician Employee and other licensed employee or independent contractor
of Seller (i) is the holder of all valid licenses, approvals, orders, consents,
permits, registrations, qualifications and other rights and authorizations
required by law, ordinance, regulation or ruling of any governmental regulatory
authority necessary to operate its/his/her business and (ii) is certified for
participation under Titles XVIII and XIX of the Social Security Act (the
"Medicare and Medicaid Programs") (Medicare and Medicaid Programs and such
other similar federal, state or local reimbursement or governmental programs
for which Seller is eligible are hereinafter referred to collectively as the
"Governmental Programs") and has current provider numbers for such Governmental
Programs and with such private non-governmental programs (including without
limitation any private insurance program) under which Seller is presently
receiving payments directly or indirectly from any Payor for patient care (such
non-governmental programs herein referred to as "Private Programs"). A true,
correct and complete list of such licenses, permits and other authorizations,
and provider agreements, is set forth in Schedule 5.28(a), true, complete and
correct copies of which have been provided to APPM. No violation, default,
order or deficiency exists with respect to any of the items listed in Schedule
5.28(a) except for such violations, defaults, orders or deficiencies which
would not be reasonably likely to have a Material Adverse Effect on Seller, and
there is no action pending or recommended by any state or federal agencies
having jurisdiction over the items listed in Schedule 5.28(a), either to
revoke, withdraw or suspend any material license or to terminate the
participation of Seller in any Governmental Program or Private Program, and no
event has occurred which, with or without notice or lapse of time, or both,
would constitute grounds for a violation, order or deficiency with respect to
any of the items listed in Schedule 5.28(a) or to revoke, withdraw or suspend
any material license to operate its business as is presently being conducted by
it. To the knowledge of Seller, there has been no decision not to renew any
existing agreement with any provider or Payor relating to Seller's business as
presently being conducted by it. Except as set forth in Schedule 5.28(a) or
Schedule 5.12 hereof, neither Seller nor any Physician Employee (i) has had
his/her/its professional license, Drug Enforcement Agency number,
Medicare/Medicaid provider status or staff privileges at any hospital or
diagnostic imaging center suspended, relinquished, terminated or revoked; (ii)
has been reprimanded, sentenced, or disciplined by any licensing board, state
agency, regulatory body or authority, hospital, Payor or specialty board; or
(iii) has had a final judgment or settlement entered against him/her/its in
connection with a malpractice or similar action.
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(2) Except as set forth in Schedule 5.28(b), Seller is
not required, and for the 72-month period prior to the Effective Time was not
required, to file any cost reports or other reports with any Governmental
Program or Private Program.
Section 1.39 Inspections and Investigations. Neither the right of
Seller, or any Physician Employee, nor the right of any licensed professional
or other individual affiliated with Seller to receive reimbursements pursuant
to any Governmental Program or Private Program has been terminated or otherwise
materially and adversely affected as a result of any investigation or action
whether by any federal or state governmental regulatory authority or other
third party. Except as set forth and described in Schedule 5.29, no Physician
Employee, licensed professional or other individual affiliated with the
business has, during the past three (3) years prior to the Effective Time, had
their license suspended or revoked by any governmental regulatory authority or
agency, hospital, integrated delivery system, trade association, professional
review organization, accrediting organization or certifying agency. True,
correct and complete copies of all reports, correspondence, notices and other
documents relating to any matter described or referenced in Schedule 5.29 have
been provided to Buyer.
Section 1.40 Proprietary Rights and Information.
(1) Set forth in Schedule 5.30(a) is a complete and
accurate list and summary description of the following: (i) all trademarks
(registered and unregistered), trade-names, service marks and other trade
designations, including common law rights, registrations and applications
therefor, currently owned in whole or part, or used by Seller or any of its
Affiliates; (ii) all patents and applications therefor and inventories and
discoveries that may be patentable currently owned, in whole or in part, or
used by Seller or any of its Affiliates; (iii) all licenses, royalties, and
assignments thereof to which Seller or any of its Affiliates are a party; (iv)
all copyrights (for published and unpublished works) currently owned in whole
or part, or used by Seller or any of its Affiliates; and (v) other similar
agreements relating to the foregoing to which Seller or any of its affiliates
is a party (including expiration date if applicable) (collectively, the
"Proprietary Rights").
(2) Schedule 5.30(b) contains a complete and accurate
list and summary description of all agreements relating to technology, trade
secrets, know-how or processes that Seller is licensed or authorized to use by
others (other than technology, know-how or processes generally available to
other health care providers) or which it licenses or authorizes others to use,
true, correct and complete copies of which have been provided to Buyer or APPM.
There are no outstanding or, to Seller's knowledge, threatened disputes or
disagreements with respect to any such agreement.
(3) Seller owns or has the legal right to use the
Proprietary Rights without conflicting with, infringing or violating the rights
of any other person. Except as disclosed in Schedule 5.30(c), no consent of
any person will be required for the use thereof by Buyer or APPM upon
consummation of the transactions contemplated hereby and the Proprietary Rights
are freely transferable. No claim has been asserted by any person to the
ownership of or for infringement by Seller of any Proprietary Right of any
other Person, and neither Seller nor any Principal Stockholder is aware of any
valid basis for any such claim. To the best knowledge of Seller, no
proceedings have been threatened which challenge the Proprietary Rights of
Seller. Seller has the right to use, free and clear of any adverse claims or
rights of others, all trade secrets, customer lists and proprietary information
required for the performance and marketing of all merchandise and services
formerly or presently sold or marketed by them.
Section 1.41 Taxes.
(1) Filing of Tax Returns. Seller has duly and timely
filed (in accordance with any extensions duly granted by the appropriate
governmental agency, if applicable) with the appropriate governmental agencies
all Tax Returns and reports required to be filed by the United States or any
state or any political
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subdivision thereof or any foreign jurisdiction. All such Tax Returns or
reports are complete and accurate in all material respects and properly reflect
the taxes of Seller for the periods covered thereby.
(2) Payment of Taxes. Except for such items as Seller
may be disputing in good faith by proceedings in compliance with applicable
law, which are described in Schedule 5.31(b), (i) Seller has paid all taxes,
penalties, assessments and interest that have become due with respect to any
Tax Returns that it has filed and has properly accrued on its books and records
in accordance with generally accepted accounting principles for all of the same
that have not yet become due and payable; and (ii) Seller is not delinquent in
the payment of any tax, assessment or governmental charge.
(3) No Pending Deficiencies, Delinquencies, Assessments
or Audits. Except as set forth in Schedule 5.31(c), Seller has not received
any notice that any tax deficiency or delinquency has been asserted against
Seller, and to the best knowledge of Seller, there is no threat of such
assertion. There is no unpaid assessment, proposal for additional taxes,
deficiency or delinquency in the payment of any of the taxes of Seller that
could be asserted by any taxing authority. Since January 1, 1993, there has
been no taxing authority audit and there is no taxing authority audit of Seller
pending, or to the actual knowledge of Seller, threatened against Seller or any
Seller Subsidiary (and the results of any completed audits are properly
reflected in Seller Financial Statements). Seller has not violated any
applicable federal, state, local or foreign tax law. There are no security
interests or liens on any assets of Seller or any Seller Subsidiary which have
resulted from any failure to pay (or alleged failure to pay) taxes.
(4) No Extension of Limitation Period. Seller has not
granted an extension to any taxing authority of the statute of limitation
period during which any tax liability may be assessed or collected.
(5) All Withholding Requirements Satisfied. All monies
required to be withheld by Seller and paid to governmental agencies for all
income, social security, unemployment insurance, sales, excise, use, and other
taxes have been collected or withheld and timely paid to the respective
governmental agencies.
(6) Foreign Person. Neither Seller nor any Principal
Stockholder is a foreign person, as such term is referred to in Section
1445(f)(3) of the Code and Treasury Regulations Section 1.1445-2.
(7) Safe Harbor Lease. None of the properties or assets
of Seller constitutes property that Seller, APPM, Buyer or any Affiliate of
APPM, will be required to treat as being owned by another person pursuant to
the "Safe Harbor Lease" provisions of Section 168(f)(8) of the Code prior to
repeal by the Tax Equity and Fiscal Responsibility Act of 1982.
(8) Tax Exempt Entity. None of the assets or properties
of Seller are subject to a lease to a "tax exempt entity" as such term is
defined in Section 168(h)(2) of the Code.
(9) Collapsible Corporation. Seller has not at any time
consented to have the provisions of Section 341(f)(2) of the Code apply to it.
(10) Boycotts. Seller has not at any time participated in
or cooperated with any international boycott as defined in Section 999 of the
Code.
(11) Parachute Payments. No payment required or
contemplated to be made by Seller will be characterized as an "excess parachute
payment" within the meaning of Section 280G of the Code.
(12) S Corporation. Seller has not made an election to be
taxed as an "S" corporation under Section 1362(a) of the Code.
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(13) Personal Holding Companies. Seller is not and has
not been a personal holding company within the meaning of Section 542 of the
Code.
Section 1.42 Related Party Arrangements. Schedule 5.32 sets forth
a description of any interest held, directly or indirectly, by any officer,
director or other Affiliate of Seller in any property, real or personal or
mixed, tangible or intangible, used in or pertaining to Seller's business and
any arrangement or agreement with any such Person concerning the provision of
goods or services or other matters pertaining to Seller's business. There is
no commitment to, and no income reflected in Seller Financial Statements that
has been derived from an Affiliate. Except as set forth in Schedule 5.32, none
of the Assumed Liabilities includes any obligation of any kind or designation
to any Affiliate of Seller or the Principal Stockholders.
Section 1.43 Banking Relations. Set forth in Schedule 5.33 is a
complete and accurate list of all borrowing and investing arrangements that
Seller has with any bank or other financial institution, indicating with
respect to each relationship the type of arrangement maintained (such as
checking account, borrowing arrangements, safe deposit box, etc.) and the
Person or Persons authorized in respect thereof.
Section 1.44 Fraud and Abuse and Self Referral. Neither Seller
nor any Seller Subsidiary has engaged and, to the knowledge of Seller, neither
Seller's officers and directors nor the Physician Employees or other Persons
and entities providing professional services for or on behalf of Seller have
engaged, in any activities which are prohibited under 42 U.S.C. Sections 1320a
7, 7a or 7b or 42 U.S.C. Section 1395nn (subject to the exceptions or safe
harbor provisions set forth in such legislation), or the regulations
promulgated thereunder or pursuant to similar state or local statutes or
regulations, or which are prohibited by applicable rules of professional
conduct.
Section 1.45 Restrictions on Business Activities. Except as
disclosed in Schedule 5.14 or Schedule 5.35, there is no material agreement,
judgment, injunction, order or decree binding upon Seller, any Seller
Subsidiary or officer, director or key employee (including, but not limited to,
Physician Employees) of Seller or Seller Subsidiary, which has or reasonably
could be expected to have the effect of prohibiting or materially impairing any
current or future business practice of Seller or any Seller Subsidiary, any
acquisition of property by Seller, any Seller Subsidiary or the conduct of
business by Seller or any Seller Subsidiary.
Section 1.46 Agreements in Full Force and Effect. Except as
expressly set forth in Seller's Schedules to this Agreement, all contracts,
agreements, plans, leases, policies and licenses referred to, or required to be
referred to, in Seller's Schedules delivered hereunder are valid and binding,
and are in full force and effect and are enforceable in accordance with their
terms, except to the extent that the validity or enforceability thereof may be
limited by bankruptcy or other laws affecting the enforcement of creditors'
rights generally, or by general equity principles, or by public policy. There
is no pending or, to the knowledge of Seller, threatened bankruptcy, insolvency
or similar proceeding with respect to any other party to such agreements, and
no event has occurred which (whether with or without notice, lapse of time or
the happening or occurrence of any other event) would constitute a default
thereunder by Seller or any other party thereto. No contract with a health
care provider has been terminated in the last twelve (12) months.
Section 1.47 Statements True and Correct. No representation or
warranty made herein by Seller or any Principal Stockholder, nor any statement,
certificate, exhibit or instrument to be furnished by Seller or any Principal
Stockholder to APPM or Buyer pursuant to this Agreement, contains or will
contain as of the Effective Time any untrue statement of material fact or omits
or will omit to state a material fact necessary to make the statements
contained herein and therein not misleading.
Section 1.48 Schedules. All Schedules required by Article V
hereof and attached hereto are true, correct and complete in all material
respects as of the date of this Agreement.
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Section 1.49 Finders' Fees. Except as set forth in Schedule 5.39,
no investment banker, broker, finder or other intermediary has been retained by
or is authorized to act on behalf of any of the Principal Stockholders or
Seller who is entitled to any fee or commission upon consummation of the
transactions contemplated by this Agreement or referred to herein.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYER AND APPM
Buyer and APPM each represents and warrants to Seller as follows:
Section 1.50 Organization and Good Standing; Qualification. Each
of Buyer and APPM is a corporation duly organized, validly existing and in good
standing under the laws of the state of Delaware, with all requisite corporate
power and authority to own, operate and lease its assets and properties and to
carry on its business as currently conducted. Each of Buyer and APPM is duly
qualified to do business as a foreign corporation and is in good standing in
each jurisdiction where the character of the property owned or leased by it or
the nature of its activities makes such qualification necessary, except where
such failure to be so qualified or in good standing would not have a Material
Adverse Effect on Buyer or APPM. Copies of the certificate of incorporation
and all amendments thereto of Buyer and APPM and the bylaws of Buyer and APPM,
as amended, and copies of the corporate minutes of Buyer and APPM regarding
this transaction, all of which have been or will be made available to Seller
for review, are true, correct and complete as in effect on the date of this
Agreement and accurately reflect all material proceedings of the Principal
Stockholders and directors of Buyer and APPM (and all committees thereof)
regarding this transaction.
Section 1.51 Authorization and Validity. Each of Buyer and APPM
has all requisite corporate power to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery and
performance by Buyer and APPM of this Agreement and the agreements provided for
herein, and the consummation by Buyer and APPM of the transactions contemplated
hereby and thereby are within Buyer and APPM's respective corporate powers and
have been duly authorized by all necessary action on the part of Buyer's and
APPM's Boards of Directors. This Agreement has been duly executed by Buyer and
APPM. This Agreement and all other agreements and obligations entered into and
undertaken in connection with the transactions contemplated hereby to which
Buyer and APPM is a party constitute, or upon execution will constitute, valid
and binding agreements of Buyer and APPM, enforceable against it in accordance
with their respective terms, except as may be limited by bankruptcy or other
laws affecting creditors' rights generally, or by general equity principles, or
by public policy.
Section 1.52 Governmental Authorization. Except as expressly set
forth in Schedule 6.3, and other than consents, filings or notifications
required to be made or obtained by Buyer and APPM, the execution, delivery and
performance by Buyer and APPM of this Agreement and the agreements provided for
herein, and the consummation of the transactions contemplated hereby and
thereby by Buyer and APPM, to the best knowledge of Buyer and APPM, requires no
action by or in respect of, or filing with, any governmental body, agency,
official or authority.
Section 1.53 Capitalization. The authorized capital stock of APPM
consists of 50,000,000 shares of APPM Common Stock, of which approximately
17,540,000 shares are issued and outstanding and 10,000,000 shares of APPM
Preferred Stock, none of which are outstanding. Each outstanding share of APPM
Common Stock which is being purchased by Seller hereunder has been legally and
validly issued and is fully paid and nonassessable, and based in part upon the
representations of Seller in this Agreement will be issued pursuant to a valid
exemption from registration under (i) the Securities Act and (ii) all
applicable state securities laws.
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Section 1.54 Absence of Conflicting Agreements or Required
Consents. To the best knowledge of Buyer and APPM, the execution, delivery and
performance of this Agreement by Buyer and/or APPM and any other documents
contemplated hereby (with or without the giving of notice, the lapse of time,
or both): (i) except as set forth in Schedule 6.3 and Schedule 6.5 hereto, does
not require the consent of any governmental or regulatory body or authority or
any other third party; (ii) will not conflict with any provision of Buyer's or
APPM's certificate of incorporation or bylaws; (iii) will not conflict with,
result in a violation of, or constitute a default under any law, ordinance,
regulation, ruling, judgment, order or injunction of any court or governmental
instrumentality to which Buyer or APPM is a party or by which Buyer or APPM or
their or its properties are subject to or bound; and (iv) except as set forth
in Schedule 6.5, will not conflict with, constitute grounds for termination of,
result in a breach of, constitute a default under, require any notice under, or
accelerate or permit the acceleration of any performance required by the terms
of any agreement, instrument, license or permit, material to this transaction,
to which Buyer or APPM is a party or by which Buyer or APPM or any of their
respective properties are bound.
Section 1.55 Statements True and Correct. No representation or
warranty made herein by Buyer or APPM, nor any statement, certificate or
instrument to be furnished by Buyer or APPM to Seller or a Principal
Stockholder pursuant to this Agreement, contains or will contain as of the
Effective Time any untrue statement of material fact or omits or will omit to
state a material fact necessary to make the statements contained herein and
therein not misleading.
Section 1.56 Schedules. All Schedules required by Article IV
hereof and attached hereto are true, correct and complete in all material
respects as of the date of this Agreement.
Section 1.57 Finders' Fees. No investment banker, broker, finder
or other intermediary has been retained by or is authorized to act on behalf of
Buyer or APPM who is entitled to any fee or commission upon consummation of the
transactions contemplated by this Agreement or referred to herein.
ARTICLE VII
INTENTIONALLY OMITTED
ARTICLE VIII
INTENTIONALLY OMITTED
ARTICLE IX
INTENTIONALLY OMITTED
ARTICLE X
INTENTIONALLY OMITTED
ARTICLE XI
CLOSING DELIVERIES
Section 1.58 Deliveries of Seller. Seller hereby delivers to
Buyer the following:
(1) a copy of resolutions of the Boards of Directors of
Seller authorizing the execution, delivery and performance of this Agreement
and all related documents and agreements, each certified by the Secretary of
such corporation as being true and correct copies of the originals thereof
subject to no modifications or amendments;
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(2) a copy of resolutions of the Boards of Directors of
Seller authorizing the execution, delivery and performance of the Service
Agreement (as defined below) and Employment Agreements (as defined below)
(collectively, the "Other Agreements") each certified by the Secretary of
Seller as being true and correct copies of the originals thereof subject to no
modifications or amendments;
(3) Intentionally Omitted;
(4) Intentionally Omitted;
(5) a certificate of the Secretary of Seller certifying
as to the incumbency of the directors and officers of such corporation and as
to the signatures of such directors and officers who have executed documents
delivered on behalf of that corporation;
(6) a certificate, dated within ten (10) days prior to
the date hereof, of the Secretary of State of Florida establishing that Seller
is in existence, has paid all franchise or similar taxes, if any, and, if
applicable, otherwise is in good standing to transact business in the state of
Florida;
(7) Intentionally Omitted;
(8) all authorizations, consents, approvals, permits and
licenses referenced in Section 5.28;
(9) the executed Service Agreement entered into by and
among Buyer, APPM and Seller as of the date hereof (the "Service Agreement");
(10) Intentionally Omitted;
(11) an assignment to Buyer of (i) each lease for real or
personal property described on Schedule 5.20 (the "Lease Assignments"); (ii)
all contracts described on Schedule 5.14 which can be assigned to Buyer
("Non-Payor Contract Assignments"); (iii) all Purchased Contracts; and (iv) all
contracts described in Schedule 5.14 which cannot be assigned to Buyer ("Payor
Contract Assignments");
(12) the executed employment agreements by and between RIA
and each of the Principal Stockholders (the "Employment Agreements"); and
(13) the executed legal opinion by counsel to Seller dated of even date.
Section 1.59 Deliveries of APPM. APPM hereby delivers to Seller
the following:
(1) a copy of resolutions of the Board of Directors of
APPM authorizing the execution, delivery and performance of this Agreement, and
all related documents and agreements, certified by APPM's Secretary as being
true and correct copies of the originals thereof subject to no modifications or
amendments;
(2) the Purchase Price accordance with Article IV hereof;
(3) Intentionally Omitted;
(4) Intentionally Omitted;
(5) a certificate of the Secretary of Buyer certifying as
to the incumbency of the officers of Buyer who have executed documents on
behalf of Buyer;
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(6) a certificate, dated within ten (10) days prior to
the date hereof, of the Secretary of State of Delaware establishing that Buyer
is in existence, has paid all franchise or similar taxes, if any, and, if
applicable, otherwise is in good standing to transact business in the state of
Delaware;
(7) certificates (or photocopies thereof), dated within
ten (10) days prior to the date hereof, of the Secretaries of State of the
states in which Buyer is qualified to do business, to the effect that Buyer is
qualified to do business and, if applicable, is in good standing as a foreign
corporation in such state;
(8) the executed Other Agreements; and
(9) the executed Lease Assignments, Non-Payor Contract
Assignments, Purchased Contracts and Payor Contract Assignments.
ARTICLE XII
INTENTIONALLY OMITTED
ARTICLE XIII
POST CLOSING MATTERS
Section 1.60 Further Instruments of Transfer. Following the date
hereof, at the request of Buyer and at Buyer's sole cost and expense, the
Principal Stockholders and Seller shall deliver any further instruments of
transfer and take all reasonable action as may be necessary or appropriate to
carry out the purpose and intent of this Agreement.
Section 1.61 Certain Prorations.
(1) The items set forth on Schedule 13.2(a) shall be
prorated or adjusted between the parties hereto as of the Effective Time.
(2) On the date hereof, each party shall pay or credit to
the other party all sums required to effectuate the prorations and adjustments
contemplated by the provisions of this Section 13.2. If final figures have not
been calculated on any of the adjustments, prorations or reimbursements as of
the date hereof, then the parties hereto shall close this transaction using
estimated adjustments, prorations and reimbursements which shall be subject to
later readjustment when such final figures have been calculated. The parties
hereto shall seek to determine the amounts of all prorations, adjustments and
reimbursements required hereunder on or before the date hereof, if possible,
and no later than six (6) months following the date hereof.
Section 1.62 Certain Expenses.
(1) Seller shall be responsible for the following
expenses: (i) obtaining, filing and recording any and all releases,
satisfactions, deeds, UCC termination statements and similar documents required
in order to cause title to the Purchased Assets to be free, clear and
unencumbered except for Permitted Encumbrances (as defined in Section 5.3(b)
hereof); and (ii) all sales, use, transfer and other taxes, if any, required by
or imposed as a result of the transactions contemplated hereby.
(2) Each party shall be responsible for its own
attorneys', accountants' and other advisory fees associated with the closing of
the transactions contemplated by this Agreement.
(3) Intentionally Omitted.
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Section 1.63 Intentionally Omitted.
Section 1.64 Intentionally Omitted.
Section 1.65 Intentionally Omitted.
ARTICLE XIV
REMEDIES
Section 1.66 Indemnification by Seller. Subject to the terms and
conditions of this Article XIV, RIA and each Principal Stockholder, jointly and
severally, shall indemnify, defend and hold APPM and Buyer and their respective
directors, officers, members, managers, employees, agents, attorneys and
Affiliates (collectively, the "Buyer Indemnitees") harmless from and against
all losses, claims, obligations, demands, assessments, penalties, liabilities,
costs, damages, reasonable attorneys' fees and expenses (collectively,
"Damages") asserted against or incurred by such Buyer Indemnitees arising out
of or resulting from:
(1) a breach of any representation or warranty (without
giving effect to any Material Adverse Effect qualifier contained as part of any
such representation or warranty) or covenant of Seller contained herein or in
any Schedule or certificate delivered hereunder;
(2) any violation (or alleged violation) by Seller and/or
any of its past or present directors, officers, partners, shareholders,
employees (including, without limitation, any Physician Employee), agents,
consultants and Affiliates of state or federal laws governing health care fraud
and abuse (including, but not limited to, fraud and abuse in the Medicare and
Medicaid programs) occurring on or before the date hereof, or any overpayment
or obligation (or alleged overpayment or obligation) arising out of or
resulting from claims submitted to any Payor on or before the date hereof;
(3) any liability under the Securities Act, the Exchange
Act or any other federal or state "blue sky" or securities law or regulation,
at common law or otherwise, arising out of or based upon any untrue statement
or alleged untrue statement of a material fact relating to Seller (including
any Seller Subsidiary) or any Principal Stockholder, and provided to APPM or
its counsel by Seller, specifically for inclusion in any preliminary
prospectus, registration statement or prospectus forming a part thereof, or any
amendment thereof or supplement thereto), arising out of or based upon any
omission or alleged omission to state therein a material fact relating to
Seller required to be stated therein or necessary to make the statements
therein not misleading; and
(4) all Unassumed Liabilities.
Section 1.67 Indemnification by APPM and Buyer. Subject to the
terms and conditions of this Article XIV, APPM and Buyer jointly and severally
shall indemnify, defend and hold Seller and its respective agents, attorneys
and Affiliates (collectively, the "Seller Indemnities") harmless from and
against all Damages asserted against or incurred by such Seller Indemnities
arising out of or resulting from:
(1) a breach by APPM or Buyer of any representation or
warranty (without giving effect to any Material Adverse Effect qualifier
contained as part of any such representation or warranty) or covenant of APPM
or Buyer contained herein or in any schedule or certificate delivered
hereunder; and
(2) all Assumed Liabilities.
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Section 1.68 Conditions of Indemnification. All claims for
indemnification under this Agreement shall be asserted and resolved as follows:
(1) A party claiming indemnification under this Agreement
(an "Indemnified Party") shall promptly (and, in any event, at least ten (10)
days prior to the due date for any responsive pleadings, filings or other
documents) (i) notify the party from whom indemnification is sought (the
"Indemnifying Party") of any third-party claim or claims asserted against the
Indemnified Party ("Third Party Claim") that could give rise to a right of
indemnification under this Agreement and (ii) transmit to the Indemnifying
Party a written notice ("Claim Notice") describing in reasonable detail the
nature of the Third Party Claim, a copy of all papers served with respect to
such claim (if any), an estimate of the amount of Damages attributable to the
Third Party Claim and the basis of the Indemnified Party's request for
indemnification under this Agreement. Except as set forth in Section 14.6, the
failure to promptly deliver a Claim Notice shall not relieve the Indemnifying
Party of its obligations to the Indemnified Party with respect to the related
Third Party Claim except to the extent that the resulting delay is materially
prejudicial to the defense of such claim.
Within thirty (30) days after receipt of any Claim
Notice (the "Election Period"), the Indemnifying Party shall notify the
Indemnified Party (i) whether the Indemnifying Party disputes its potential
liability to the Indemnified Party under this Article XIV with respect to such
Third Party Claim; and (ii) whether the Indemnifying Party desires, at the sole
cost and expense of the Indemnifying Party, to defend the Indemnified Party
against such Third Party Claim.
(2) If the Indemnifying Party notifies the Indemnified
Party within the Election Period that the Indemnifying Party elects to assume
the defense of the Third Party Claim, then the Indemnifying Party shall have
the right to defend, at its sole cost and expense, such Third Party Claim by
all appropriate proceedings, which proceedings shall be prosecuted diligently
by the Indemnifying Party to a final conclusion or settled at the discretion of
the Indemnifying Party in accordance with this Section 14.3(b). The
Indemnifying Party shall have full control of such defense and proceedings,
including any compromise or settlement thereof. The Indemnified Party is
hereby authorized, at the sole cost and expense of the Indemnifying Party (but
only if the Indemnified Party is entitled to indemnification hereunder), to
file, during the Election Period, any motion, answer or other pleadings that
the Indemnified Party shall deem necessary or appropriate to protect its
interests or those of the Indemnifying Party and not prejudicial to the
Indemnifying Party (it being understood and agreed that if an Indemnified Party
takes any such action that is prejudicial and causes a final adjudication that
is adverse to the Indemnifying Party, the Indemnifying Party shall be relieved
of its obligations hereunder with respect to such Third Party Claim). If
requested by the Indemnifying Party, the Indemnified Party agrees, at the sole
cost and expense of the Indemnifying Party, to cooperate with the Indemnifying
Party and its counsel in contesting any Third Party Claim that the Indemnifying
Party elects to contest, including, without limitation, the making of any
related counterclaim against the person asserting the Third Party Claim or any
cross-complaint against any person. The Indemnified Party may participate in,
but not control, any defense or settlement of any Third Party Claim controlled
by the Indemnifying Party pursuant to this Section 14.3(b) and shall bear its
own costs and expenses with respect to such participation; provided, however,
that if the named parties to any such action (including any impleaded parties)
include both the Indemnifying Party and the Indemnified Party, and the
Indemnified Party has been advised by counsel that there may be one or more
legal defenses available to it that are different from or additional to those
available to the Indemnifying Party, then the Indemnified Party may employ
separate counsel at the expense of the Indemnifying Party, and upon written
notification thereof, the Indemnifying Party shall not have the right to assume
the defense of such action on behalf of the Indemnified Party; provided further
that the Indemnifying Party shall not, in connection with any one such action
or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys at any time for the Indemnified Party, which firm shall be designated
in writing by the Indemnified Party.
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(3) If the Indemnifying Party fails to notify the
Indemnified Party within the Election Period that the Indemnifying Party elects
to defend the Indemnified Party pursuant to Section 14.3(b), or if the
Indemnifying Party elects to defend the Indemnified Party pursuant to Section
14.3(b) but fails diligently and promptly to prosecute or settle the Third
Party Claim, then the Indemnified Party shall have the right to defend, at the
sole cost and expense of the Indemnifying Party (if the Indemnified Party is
entitled to indemnification hereunder), the Third Party Claim by all
appropriate proceedings, which proceedings shall be promptly and vigorously
prosecuted by the Indemnified Party to a final conclusion or settled. The
Indemnified Party shall have full control of such defense and proceedings,
provided, however, that the Indemnified Party may not enter into, without the
Indemnifying Party's consent, which shall not be unreasonably withheld, any
compromise or settlement of such Third Party Claim. Notwithstanding the
foregoing, if the Indemnifying Party has delivered a written notice to the
Indemnified Party to the effect that the Indemnifying Party disputes its
potential liability to the Indemnified Party under this Article XIV and if such
dispute is resolved in favor of the Indemnifying Party, the Indemnifying Party
shall not be required to bear the costs and expenses of the Indemnified Party's
defense pursuant to this Section or of the Indemnifying Party's participation
therein at the Indemnified Party's request, and the Indemnified Party shall
reimburse the Indemnifying Party in full for all costs and expenses of such
litigation. The Indemnifying Party may participate in, but not control, any
defense or settlement controlled by the Indemnified Party pursuant to this
Section 14.3(c), and the Indemnifying Party shall bear its own costs and
expenses with respect to such participation; provided, however, that if the
named parties to any such action (including any impleaded parties) include both
the Indemnifying Party and the Indemnified Party, and the Indemnifying Party
has been advised by counsel that there may be one or more legal defenses
available to it that are different from or additional to those available to the
Indemnified Party, then the Indemnifying Party may employ separate counsel and
upon written notification thereof, the Indemnified Party shall not have the
right to assume the defense of such action on behalf of the Indemnifying Party.
(4) In the event any Indemnified Party should have a
claim against any Indemnifying Party hereunder that does not involve a Third
Party Claim, the Indemnified Party shall transmit to the Indemnifying Party a
written notice (the "Indemnity Notice") describing in reasonable detail the
nature of the claim, an estimate of the amount of damages attributable to such
claim and the basis of the Indemnified Party's request for indemnification
under this Agreement. If the Indemnifying Party does not notify the
Indemnified Party within sixty (60) days from its receipt of the Indemnity
Notice that the Indemnifying Party disputes such claim, the claim specified by
the Indemnified Party in the Indemnity Notice shall be deemed a liability of
the Indemnifying Party hereunder. If the Indemnifying Party has timely
disputed such claim, as provided above, such dispute shall be resolved by
litigation in an appropriate court of competent jurisdiction if the parties do
not reach a settlement of such dispute within thirty (30) days after notice of
a dispute is given.
(5) Payments of all amounts owing by an Indemnifying
Party pursuant to this Article XIV relating to a Third Party Claim shall be
made within thirty (30) days after the latest of (i) the settlement of such
Third Party Claim, (ii) the expiration of the period for appeal of a final
adjudication of such Third Party Claim, or (iii) the expiration of the period
for appeal of a final adjudication of the Indemnifying Party's liability to the
Indemnified Party under this Agreement. Payments of all amounts owing by an
Indemnifying Party pursuant to Section 14.3(d) shall be made within 30 days
after the later of (i) the expiration of the 60-day Indemnity Notice period or
(ii) the expiration of the period for appeal of a final adjudication of the
Indemnifying Party's liability to the Indemnified Party under this Agreement.
(6) Notwithstanding any provision herein to the contrary,
the obligation of APPM or Buyer, on the one hand, or Seller or any Principal
Stockholder, on the other hand, to provide indemnification for breach of any
representation or warranty as provided in Section 14.1(a) or Section 14.2(a)
hereof shall not take effect unless and until the Damages asserted against or
incurred in the aggregate and on a collective basis by APPM or Buyer, on the
one hand, or Seller, on the other hand, as a result of such a breach or
breaches exceeds
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$5,000.00, and then such Indemnifying Party shall indemnify the Indemnified
Party to the full amount of such Damages.
Section 1.69 Remedies Not Exclusive.
(1) The remedies provided in this Agreement shall not be
exclusive of any other rights or remedies available to one party against the
other, either at law or in equity.
Section 1.70 Costs, Expenses and Legal Fees. Whether or not the
transactions contemplated hereby are consummated, each party hereto shall bear
its own costs and expenses (including attorneys' fees), except that each party
hereto agrees to pay the costs and expenses (including reasonable attorneys'
fees and expenses) incurred by the other parties in successfully (a) enforcing
any of the terms of this Agreement or (b) proving that another party breached
any of the terms of this Agreement.
Section 1.71 Tax Benefits; Insurance Proceeds. The total amount
of any indemnity payments owed by one party to another party to this Agreement
shall be reduced by any correlative tax benefit received by the party to be
indemnified or the net proceeds received by the party to be indemnified with
respect to recovery from third parties or insurance proceeds, and such
correlative insurance benefit shall be net of the insurance premium, if any,
that becomes due as a result of such claim.
Section 1.72 Commencing Actions. Any action against any party
hereto that is not commenced on or before the third anniversary of the Closing
Date shall be deemed waived, and no person shall have any remedy against any
party therefor; provided, however, that actions by Buyer or APPM against any
Seller or Principal Stockholder may be commenced at any time with respect to
actions (i) that constitute fraud or intentional misrepresentation by any
Seller or Principal Stockholder; (ii) that result from the failure of any
Seller or Principal Stockholder to pay any taxes or any penalties, assessments
or interest thereon; (iii) that result from the failure of any Seller or
Principal Stockholder to deliver to Buyer or APPM good, valid and marketable
title to the Purchased Assets; or (iv) that result from any breach of Section
5.13 or Section 5.22 or any misrepresentation relating to the representations
and warranties set forth therein.
ARTICLE XV
INTENTIONALLY OMITTED
ARTICLE XVI
NONDISCLOSURE OF CONFIDENTIAL INFORMATION
Section 1.73 Non-Disclosure Covenant. Seller recognizes and
acknowledges that it has in the past, currently has, and in the future may
possibly have, access to certain Confidential Information of APPM that is
valuable, special and unique assets of APPM's businesses. Seller shall not
disclose such Confidential Information to any person, firm, corporation,
association or other entity for any purpose or reason whatsoever, unless (i)
such information becomes available to or known by the public generally through
no fault of Seller; (ii) disclosure is required by law or the order of any
governmental authority under color of law, provided, that prior to disclosing
any information pursuant to this clause (ii), Seller shall, if possible, give
prior written notice thereof to APPM and provide APPM with the opportunity to
contest such disclosure; or (iii) the disclosing party reasonably believes that
such disclosure is required by applicable law in connection with the defense of
a lawsuit against the disclosing party. In the event of a breach or threatened
breach by Seller of the provisions of this Section, APPM shall be entitled to
an injunction restraining the other party, as the case may be, from disclosing,
in whole or in part, such Confidential Information. Nothing herein shall be
construed as prohibiting APPM from pursuing any other available remedy for such
breach or threatened breach, including the recovery of damages.
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Section 1.74 Damages. Because of the difficulty of measuring
economic losses as a result of the breach of the foregoing covenants, and
because of the immediate and irreparable damage that would be caused for which
they would have no other adequate remedy, Seller agrees that, in the event of a
breach by it of the foregoing covenant, the covenant may be enforced against it
by injunctions and restraining orders.
Section 1.75 Survival. The obligations of Seller under this
Article XVI shall survive the consummation of the transactions as described in
this Agreement.
ARTICLE XVII
MISCELLANEOUS
Section 1.76 Amendment; Waivers. This Agreement may be amended,
modified or supplemented only by an instrument in writing executed by all the
parties hereto. Any waiver of any terms and conditions hereof must be in
writing, and signed by the parties hereto. The waiver of any of the terms and
conditions of this Agreement shall not be construed as a waiver of any other
terms and conditions hereof.
Section 1.77 Assignment. Neither this Agreement nor any right
created hereby or in any agreement entered into in connection with the
transactions contemplated hereby shall be assignable by any party hereto,
except by APPM to a wholly owned subsidiary of APPM, provided that any such
assignment shall not relieve APPM of its obligations hereunder.
Section 1.78 Parties in Interest; No Third Party Beneficiaries.
Except as otherwise provided herein, the terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective heirs, legal
representatives, successors and assigns of the parties hereto. Neither this
Agreement nor any other agreement contemplated hereby shall be deemed to confer
upon any Person not a party hereto or thereto any rights or remedies hereunder
or thereunder.
Section 1.79 Entire Agreement. This Agreement and the agreements
contemplated hereby constitute the entire agreement of the parties regarding
the subject matter hereof, and supersede all prior agreements and
understandings, both written and oral, among the parties, or any of them, with
respect to the subject matter hereof.
Section 1.80 Severability. If any provision of this Agreement is
held to be illegal, invalid or unenforceable under present or future laws
effective during the term hereof, such provision shall be fully severable and
this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision never comprised a part hereof; and the remaining
provisions hereof shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its severance
therefrom. Furthermore, in lieu of such illegal, invalid or unenforceable
provision, there shall be added automatically as part of this Agreement a
provision as similar in its terms to such illegal, invalid or unenforceable
provision as may be possible and be legal, valid and enforceable.
Section 1.81 Survival of Representations, Warranties, Covenants
and Indemnifications. The representations, warranties, covenants,
indemnifications, and undertakings contained herein shall survive the
consummation of the transactions described herein and all statements contained
in any certificate, exhibit or other instrument delivered by or on behalf of
Seller, any Principal Stockholder, APPM or Buyer pursuant to this Agreement
shall be deemed to have been representations and warranties by such Seller,
such Principal Stockholder, APPM or Buyer and, notwithstanding any provision in
this Agreement to the contrary, the representations and warranties contained
herein shall survive the Closing.
Section 1.82 Governing Law. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN
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ACCORDANCE WITH THE SUBSTANTIVE LAWS (BUT NOT THE RULES GOVERNING CONFLICTS OF
LAWS) OF THE STATE OF TEXAS.
Section 1.83 Captions. The captions in this Agreement are for
convenience of reference only and shall not limit or otherwise affect any of
the terms or provisions hereof.
Section 1.84 Gender and Number. When the context requires, the
gender of all words used herein shall include the masculine, feminine and
neuter and the number of all words shall include the singular and plural.
Section 1.85 Reference to Agreement. Use of the words "herein,"
"hereof," "hereto" and the like in this Agreement shall be construed as
references to this Agreement as a whole and not to any particular Article,
Section or provision of this Agreement, unless otherwise noted.
Section 1.86 Confidentiality; Publicity and Disclosures. Each
party shall keep this Agreement and its terms confidential, and shall make no
press release or public disclosure, either written or oral, regarding the
transactions contemplated by this Agreement without the prior knowledge and
consent of the other parties hereto; provided that the foregoing shall not
prohibit any disclosure (a) by press release, filing or otherwise that APPM has
determined in its good faith judgment to be required by federal securities laws
or the rules of the National Association of Securities Dealers, (b) to
attorneys, accountants, investment bankers or other agents of the parties
assisting the parties in connection with the transactions contemplated by this
Agreement and (c) by APPM in connection with conducting an examination of the
operations and assets of Seller; provided that APPM shall reasonably promptly
provide notice of any release. Notwithstanding the foregoing, APPM and Buyer
shall have the right to issue a press release announcing the Closing of the
transactions covered by this Agreement following the Closing.
Section 1.87 Notice. Whenever this Agreement requires or permits
any notice, request, or demand from one party to another, the notice, request
or demand must be in writing to be effective and shall be deemed to be
delivered and received (i) if personally delivered or if delivered by telex,
telegram, facsimile or courier service, when actually received by the party to
whom notice is sent; or (ii) if delivered by mail (whether actually received or
not), at the close of business on the third business day next following the day
when placed in the mail, postage prepaid, certified or registered, addressed to
the appropriate party or parties, at the address of such party set forth below
(or at such other address as such party may designate by written notice to all
other parties in accordance herewith):
If to APPM and Buyer: American Physician Partners, Inc.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxx,
President
Xxxx X. Xxxxx, Esq,
General Counsel and
Senior Vice President
with a copy to: Xxxxxx and Xxxxx, LLP
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxx, Esq.
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If to Seller or any
Principal Stockholder: Radiology Imaging Associates,
Basilico, Xxxxxxxxx and Xxxxx, M.D.,
P.A. 0000 Xxxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxx, M.D.
with a copy to : Rogers, Bowers, Xxxxxxx and Xxxxxxxx
Flagler Center Tower
000 X. Xxxxxxx Xxxxx,
Xxxxx 0000
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx, Esq.
Section 1.88 No Waiver; Remedies. No party hereto shall by any
act (except by written instrument pursuant to Section 17.1 hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any default in or breach of any of the terms
and conditions hereof. No failure to exercise, nor any delay in exercising, on
the part of any party hereto, any right, power or privilege hereunder shall
operate as a waiver thereof. Except as set forth in Section 14.4(a) or Section
14.4(b) above, no single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege.
Section 1.89 Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original, and all of
which together shall constitute one and the same instrument.
Section 1.90 Defined Terms. Terms used in the Schedules attached
hereto with their initial letter capitalized and not otherwise defined therein
shall have the meanings as assigned to such terms in this Agreement.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first written above.
APPM:
AMERICAN PHYSICIAN PARTNERS, INC.
By:
-----------------------------------
Xxxxxxx X. Xxxxxxx, President
BUYER:
TREASURE COAST IMAGING PARTNERS, INC.
By:
-----------------------------------
Xxxxxxx X. Xxxxxxx, President
SELLER:
RADIOLOGY IMAGING ASSOCIATES, BASILICO,
XXXXXXXXX AND XXXXX, M.D., P.A.
By:
-----------------------------------
Xxxxxx X. Xxxxxxxx, M.D., President
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-----------------------------------
Xxxxxx X. Xxxxxxxx, M.D.
-----------------------------------
Xxxxxx Xxxxxxxxx, M.D.
-----------------------------------
X.X. Xxxxx, M.D.
-----------------------------------
Xxxxxx X. Xxxxxxx, M.D.
-----------------------------------
Xxxx X. Xxxxxx, M.D.
-----------------------------------
Xxxxx X. Xxxxxxxx, M.D.
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