EXHIBIT 2.2
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STOCK PURCHASE AGREEMENT
by and among
PROXYMED, INC.,
GENERAL ATLANTIC PARTNERS 77, L.P.,
GAP COINVESTMENT PARTNERS II, L.P.,
GAPSTAR, LLC,
GAPCO GMBH & CO. KG,
PVC FUNDING PARTNERS, LLC,
COMVEST VENTURE PARTNERS, L.P.,
XXXX VENTURES, LLC,
XXXXXX XXXXXX,
and
(solely for the purpose of Section 8.5 and Section 10.5)
GENERAL ATLANTIC PARTNERS 74, L.P.
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Dated: December 5, 2003
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS 1
1.1 Definitions..........................................................................1
ARTICLE II PURCHASE AND SALE OF COMMON STOCK 8
2.1 Purchase and Sale of Common Stock....................................................8
2.2 Use of Proceeds......................................................................8
2.3 Closing..............................................................................8
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY 9
3.1 Corporate Existence and Power........................................................9
3.2 Authorization; No Contravention; FBCA Sections 607.0901 and 607.0902.................9
3.3 Governmental Authorization; Third Party Consents.....................................9
3.4 Binding Effect......................................................................10
3.5 Litigation..........................................................................10
3.6 Compliance with Laws................................................................10
3.7 Capitalization......................................................................10
3.8 No Default or Breach; Contractual Obligations.......................................11
3.9 Title to Properties and Assets......................................................12
3.10 Reports; Financial Statements.......................................................12
3.11 Taxes...............................................................................12
3.12 No Material Adverse Change; Ordinary Course of Business.............................13
3.13 Private Offering....................................................................13
3.14 Labor Relations.....................................................................13
3.15 Employee Benefit Plans..............................................................14
3.16 Liabilities.........................................................................14
3.17 Intellectual Property...............................................................14
3.18 Network Redundancy and Computer Back-up.............................................16
3.19 Privacy of Customer Information.....................................................16
3.20 Potential Conflicts of Interest.....................................................16
3.21 Trade Relations.....................................................................16
3.22 Broker's, Finder's or Similar Fees..................................................17
3.23 Stockholder Approval................................................................17
3.24 True and Complete Copy of Merger Agreement and Other
Transaction-Related Agreements......................................................17
3.25 Registration Rights.................................................................17
3.26 Observance of Covenants.............................................................17
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS 17
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4.1 Existence and Power.................................................................18
4.2 Authorization; No Contravention.....................................................18
4.3 Governmental Authorization; Third Party Consents....................................18
4.4 Binding Effect......................................................................18
4.5 Purchase for Own Account............................................................18
4.6 Restricted Securities...............................................................19
4.7 Broker's, Finder's or Similar Fees..................................................19
4.8 Accredited Investor.................................................................19
ARTICLE V CONDITIONS TO THE OBLIGATION OF THE PURCHASERS TO CLOSE 20
5.1 Representations and Warranties......................................................20
5.2 Compliance with this Agreement......................................................20
5.3 Officer's Certificate...............................................................20
5.4 Secretary's Certificate.............................................................20
5.5 Purchased Shares....................................................................20
5.6 Opinion of Counsel..................................................................21
5.7 NASD................................................................................21
5.8 Stockholder Approval................................................................21
5.9 Amended and Restated Registration Rights Agreement..................................21
5.10 No Material Adverse Change..........................................................21
5.11 Consents and Approvals..............................................................21
5.12 No Material Judgment or Order.......................................................21
5.13 No Litigation.......................................................................21
5.14 Satisfaction of Conditions; Consummation of the Merger..............................22
ARTICLE VI CONDITIONS TO THE OBLIGATION OF THE COMPANY AND THE SELLING STOCKHOLDERS TO CLOSE 22
6.1 Payment of Purchase Price...........................................................22
6.2 Representations and Warranties......................................................22
6.3 Stockholder Approval................................................................22
6.4 Satisfaction of Conditions..........................................................22
ARTICLE VII INDEMNIFICATION 22
7.1 Indemnification.....................................................................22
7.2 Notification........................................................................23
7.3 Contribution........................................................................24
7.4 Cap on Indemnification..............................................................24
ARTICLE VIII COVENANTS OF THE COMPANY 24
8.1 Interim Actions.....................................................................24
8.2 Stockholder Approval................................................................25
8.3 The Acquisition.....................................................................26
8.4 Amendment of Acquisition Documents..................................................26
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8.5 Restriction on Transfer of Securities...............................................26
8.6 Waiver of Anti-dilution Provisions..................................................27
ARTICLE IX TERMINATION OF AGREEMENT 27
9.1 Termination.........................................................................27
9.2 Survival............................................................................28
ARTICLE X MISCELLANEOUS 28
10.1 Survival of Representations and Warranties..........................................28
10.2 Notices.............................................................................29
10.3 Successors and Assigns; Third Party Beneficiaries...................................32
10.4 Amendment and Waiver................................................................32
10.5 Amendment to Stock and Warrant Purchase Agreement...................................33
10.6 Counterparts........................................................................33
10.7 Headings............................................................................33
10.8 GOVERNING LAW.......................................................................33
10.9 Severability........................................................................33
10.10 Rules of Construction...............................................................33
10.11 Entire Agreement....................................................................33
10.12 Fees................................................................................33
10.13 Public Announcements................................................................33
10.14 Further Assurances..................................................................34
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EXHIBITS
A Form of Holland & Knight LLP Opinion
B Form of Amended and Restated Registration Rights Agreement
SCHEDULES
2.1 Purchased Shares and Purchase Price
3.1 Corporate Existence, Power
3.2 Authorization; No Contravention
3.3 Governmental Authorization; Third Party Consents
3.5 Litigation
3.6(a) Compliance with Laws
3.7(a) Capitalization
3.7(b) List of Subsidiaries and their Equity Holders
3.9 Title to Properties and Assets
3.11 Taxes
3.12 No Material Adverse Change; Ordinary Course of Business
3.17(a) Intellectual Property
3.17(b) Intellectual Property -- Infringement
3.17(d) Intellectual Property -- Employee Agreements
3.17(e) Intellectual Property -- Trade Secrets
3.19 Privacy of Customer Information
3.20 Conflicts of Interest
3.21 Trade Relations
3.22 Broker's, Finder's or Similar Fees
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STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated December 5, 2003 (this
"AGREEMENT"), by and among ProxyMed, Inc., a Florida corporation (the
"COMPANY"), General Atlantic Partners 77, L.P., a Delaware limited partnership
("GAP LP"), GAP Coinvestment Partners II, L.P., a Delaware limited partnership
("GAP COINVESTMENT"), GAPCO GmbH & Co. KG, a German limited partnership ("GMBH
COINVESTMENT"), GapStar, LLC, a Delaware limited liability company ("GAPSTAR"),
PVC Funding Partners, LLC, a Delaware limited liability company ("PVC"), ComVest
Venture Partners, L.P., a Delaware limited partnership ("COMVEST"), Xxxx
Ventures, LLC ("XXXX"), Xxxxxx Xxxxxx ("XXXXXX" and, collectively with GAP LP,
GAP Coinvestment, GmbH Coinvestment, GapStar, PVC, ComVest and Xxxx, the
"PURCHASERS") and, solely for the purposes set forth in Section 8.5 hereto,
Commonwealth Associates, L.P. ("COMMONWEALTH ASSOCIATES") and, solely for the
purposes set forth in Section 8.5 and Section 10.5 hereto, General Atlantic
Partners 74, L.P., a Delaware limited partnership ("GAP 74").
WHEREAS, upon the terms and conditions set forth in this
Agreement, the Company proposes to issue and sell to each of the Purchasers for
the aggregate purchase price set forth opposite such Purchaser's name on
SCHEDULE 2.1 hereto the aggregate number of shares, par value $0.001 per share,
of common stock of the Company (the "COMMON STOCK"), determined by dividing the
aggregate purchase price set forth opposite such Purchaser's name on SCHEDULE
2.1 hereto by the Price Per Share (as defined below).
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and for good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS. As used in this Agreement, and unless the
context requires a different meaning, the following terms have the meanings
indicated:
"ACQUISITION DOCUMENTS" has the meaning set forth in Section
3.24 of this Agreement.
"AFFILIATE" shall mean any Person who is an "affiliate" as
defined in Rule 12b-2 of the General Rules and Regulations under the Exchange
Act.
"AGREEMENT" means this Agreement as the same may be amended,
supplemented or modified in accordance with the terms hereof.
"AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT" has the
meaning set forth in Section 5.9 of this Agreement.
"ARTICLES OF INCORPORATION" means the Restated Articles of
Incorporation, as amended, of the Company, as in effect on the date hereof.
"ASSETS" has the meaning set forth in Section 3.9 of this
Agreement.
"AUDITED FINANCIAL STATEMENTS" has the meaning set forth in
Section 3.10 of this Agreement.
"BENEFICIAL OWNERSHIP" has the meaning given such term in
Section 13(d)(3) of the Exchange Act and the rules and regulations promulgated
thereunder.
"BOARD OF DIRECTORS" means the Board of Directors of the
Company.
"BUSINESS DAY" means any day other than a Saturday, Sunday or
other day on which commercial banks in the State of New York are authorized or
required by law or executive order to close.
"BY-LAWS" means the By-laws of the Company as in effect on the
date hereof.
"CAPITAL STOCK" means, with respect to any Person, any and all
shares, interests, participations, rights in, or other equivalents (however
designated and whether voting or non-voting) of, such Person's capital stock
(including, without limitation, common stock and preferred stock) and any and
all rights, warrants or options exchangeable for or convertible into such
capital stock.
"CLAIMS" has the meaning set forth in Section 3.5 of this
Agreement.
"CLOSING" has the meaning set forth in Section 2.3 of this
Agreement.
"CLOSING DATE" has the meaning set forth in Section 2.3 of
this Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended, or
any successor statute thereto.
"COMMISSION" means the United States Securities and Exchange
Commission or any similar agency then having jurisdiction to enforce the
Securities Act.
"COMMON STOCK" has the meaning set forth in the preamble to
this Agreement.
"COMMONLY CONTROLLED ENTITY" means any entity which is under
common control with the Company within the meaning of Code Section 414(b), (c),
(m), (o) or (t).
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"COMPANY" has the meaning set forth in the preamble to this
Agreement.
"COMPANY PLANS" means each Plan that the Company and each of
its Subsidiaries maintains or to which the Company and each of its Subsidiaries
contributes.
"CONDITION OF THE COMPANY" means the assets, business,
properties, prospects, operations or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole.
"CONTRACTUAL OBLIGATIONS" means, as to any Person, any
provision of any security issued by such Person or of any agreement,
undertaking, contract, indenture, mortgage, deed of trust or other instrument to
which such Person is a party or by which it or any of its property is bound.
"COPYRIGHTS" means any foreign or United States copyright
registrations and applications for registration thereof, and any non-registered
copyrights.
"EFFECTIVE TIME" has the meaning set forth in the Merger
Agreement.
"ENVIRONMENTAL LAWS" means federal, state, local and foreign
laws, principles of common laws, civil laws, regulations, and codes, as well as
orders, decrees, judgments or injunctions, issued, promulgated, approved or
entered thereunder relating to pollution, protection of the environment or
public health and safety.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"FAMILY MEMBER" has the meaning set forth in Section 8.5(b) of
this Agreement.
"FINANCIAL STATEMENTS" has the meaning set forth in Section
3.10 of this Agreement.
"FORM 13F FILER" means any Person required under Section 13(f)
of the Exchange Act to file a Form 13F or that would be a Person that would
satisfy the requirements under Rule 13d-1(b)(1)(i) and (ii)(A-F, H or I) under
the Exchange Act with respect to the acquisition of securities of the Company,
including as a result of a transfer of Restricted Shares from the Purchaser and
such Person's Permitted Transferees.
"GAAP" means United States generally accepted accounting
principles in effect from time to time.
"GAP COINVESTMENT" has the meaning set forth in the preamble
to this Agreement.
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"GAP LLC" means General Atlantic Partners, LLC, a Delaware
limited liability company and the general partner of GAP LP and the managing
member of GapStar, and any successor to such entity.
"GAP LP" has the meaning set forth in the preamble to this
Agreement.
"GAP 74" has the meaning set forth in the preamble to this
Agreement.
"GmbH COINVESTMENT" has the meaning set forth in the preamble
to this Agreement.
"GAPSTAR" has the meaning set forth in the preamble to this
Agreement.
"GOVERNMENTAL AUTHORITY" means the government of any nation,
state, city, locality or other political subdivision thereof, any entity,
including, without limitation, the Nasdaq Stock Market, Inc., exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"GROUP" has the meaning given such term in Section 13(d)(3) of
the Exchange Act and the rules and regulations promulgated thereunder.
"INDEMNIFIED PARTY" has the meaning set forth in Section 7.1
of this Agreement.
"INDEMNIFYING PARTY" has the meaning set forth in Section 7.1
of this Agreement.
"INTELLECTUAL PROPERTY" has the meaning set forth in Section
3.17 of this Agreement.
"INTERNET ASSETS" means any Internet domain names and other
computer user identifiers and any rights in and to sites on the worldwide web,
including rights in and to any text, graphics, audio and video files and html or
other code incorporated in such sites.
"LIABILITIES" has the meaning set forth in Section 3.16 of
this Agreement.
"LIEN" means any mortgage, deed of trust, pledge,
hypothecation, assignment, encumbrance, lien (statutory or other) or preference,
preemptive right, priority, right or other security interest or preferential
arrangement of any kind or nature whatsoever (excluding preferred stock and
equity related preferences).
"LOSSES" has the meaning set forth in Section 7.1 of this
Agreement.
"MATERIAL ADVERSE EFFECT" has the meaning ascribed to the term
"Parent Material Adverse Effect" in Section 4.01 of the Merger Agreement.
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"MATERIAL CONTRACTUAL OBLIGATIONS" has the meaning set forth
in Section 3.8 of this Agreement.
"MERGER" has the meaning set forth in the Merger Agreement.
"MERGER AGREEMENT" means the Agreement and Plan of Merger,
dated as of December 5, 2003, by and among the Company, Planvista and Planet
Acquisition Corp., a Delaware corporation.
"ORDERS" has the meaning set forth in Section 3.2 of this
Agreement.
"PATENTS" means any foreign or United States patents and
patent applications, including any divisions, continuations,
continuations-in-part, substitutions or reissues thereof, whether or not patents
are issued on such applications and whether or not such applications are
modified, withdrawn or resubmitted.
"PERMITS" has the meaning set forth in Section 3.6 of this
Agreement.
"PERMITTED TRANSFEREE" has the meaning set forth in Section
8.5(b) of this Agreement.
"PERSON" means any individual, firm, corporation, partnership,
trust, incorporated or unincorporated association, joint venture, joint stock
company, limited liability company, Governmental Authority or other entity of
any kind, and shall include any successor (by merger or otherwise) of such
entity.
"PLAN" means any employee benefit plan, arrangement, policy,
program, agreement or commitment (whether or not an employee plan within the
meaning of section 3(3) of ERISA), including, without limitation, any
employment, consulting or deferred compensation agreement, executive
compensation, bonus, incentive, pension, profit-sharing, savings, retirement,
stock option, stock purchase or severance pay plan, any life, health, disability
or accident insurance plan, whether oral or written, whether or not subject to
ERISA, as to which the Company or any Commonly Controlled Entity has or in the
future could have any direct or indirect, actual or contingent liability.
"PLANVISTA" means Planvista Corporation, a Delaware
corporation.
"PRICE PER SHARE" means $14.25.
"PURCHASED SHARES" has the meaning set forth in Section 2.1 of
this Agreement.
"PURCHASERS" has the meaning set forth in the preamble to this
Agreement.
"REGISTERABLE SECURITIES" has the meaning set forth in the
Amended and Restated Registration Rights Agreement.
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"REQUIREMENT OF LAW" means, as to any Person, any law,
Environmental Law, statute, treaty, rule, regulation, right, privilege,
qualification, license or franchise or determination of an arbitrator or a court
or other Governmental Authority or stock exchange, in each case applicable or
binding upon such Person or any of its property or to which such Person or any
of its property is subject or pertaining to any or all of the transactions
contemplated or referred to herein.
"RESTRICTED SHARES" means (a) with respect to GAP LP, GAP
Coinvestment, GapStar and GMBH Coinvestment, the Purchased Shares purchased by
such Purchaser and all of the shares of Common Stock beneficially owned by such
Purchaser on the date hereof, (b) with respect to GAP 74, all of the shares of
Common Stock beneficially owned by GAP 74 on the date hereof; PROVIDED, HOWEVER,
that notwithstanding the preceding clauses (a) and (b), an aggregate of 434,568
shares of Common Stock beneficially owned by GAP 74, GAP Coinvestment, GapStar
or GMBH Coinvestment on the date hereof shall not constitute "Restricted Shares"
(subject to adjustment for any subdivision, combination or reclassification of
shares of Common Stock, or upon any dividend or distribution payable in shares
of Common Stock) and (c) with respect to PVC, ComVest, Xxxx and Xxxxxx, the
Purchased Shares purchased by such Purchaser and all of the shares of Common
Stock issued to such Purchaser pursuant to the Merger.
"SALE TRANSACTION" means (a) (i) the merger or consolidation
of the Company into or with one or more Persons, (ii) the merger or
consolidation of one or more Persons into or with the Company or (iii) a tender
offer or other business combination if, in the case of (i), (ii) or (iii), the
stockholders of the Company prior to such merger or consolidation do not retain
at least a majority of the voting power of the surviving Person or (b) the
voluntary sale, conveyance, exchange or transfer to another Person of the voting
Capital Stock of the Company if, after such sale, conveyance, exchange or
transfer, the stockholders of the Company prior to such sale, conveyance,
exchange or transfer do not retain at least a majority of the voting power of
the Company.
"SEC REPORTS" has the meaning set forth in Section 3.10 of
this Agreement.
"SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder.
"SECRETARY" has the meaning set forth in the Company's
By-laws.
"SOFTWARE" means any computer software programs, source code,
object code, data and documentation, including, without limitation, any computer
software programs that incorporate and run the Company's pricing models,
formulae and algorithms.
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"STOCK AND WARRANT PURCHASE AGREEMENT" means the Stock and
Warrant Purchase Agreement, dated March 26, 2002, by and among the Company, GAP
LP, GAP Coinvestment, GapStar and GmbH Coinvestment.
"STOCK EQUIVALENTS" means any security or obligation which is
by its terms convertible into or exchangeable or exercisable for shares of
Common Stock or other capital stock of the Company, and any option, warrant or
other subscription or purchase right with respect to common stock or such other
capital stock.
"STOCK OPTION PLANS" means collectively, the Company's 2002
Stock Option Plan, 2001 Stock Option Plan, Amended 2000 1/2 Stock Option Plan,
2000 Stock Option Plan, 1999 Stock Option Plan, 1997 Stock Option Plan, 1995
Stock Option Plan, 1995 Outside Directors Stock Option Plan, 1993 Stock Option
Plan and ProxyMed Employee Non-Qualified Stock Option Agreement.
"STOCKHOLDER APPROVAL" has the meaning set forth in Section
3.23 of this Agreement.
"SUBSIDIARIES" means, as of the relevant date of
determination, with respect to any Person, a corporation or other Person of
which 50% or more of the voting power of the outstanding voting equity
securities or 50% or more of the outstanding economic equity interest is held,
directly or indirectly, by such Person. Unless otherwise qualified, or the
context otherwise requires, all references to a "SUBSIDIARY" or to
"SUBSIDIARIES" in this Agreement shall refer to a Subsidiary or Subsidiaries of
the Company.
"TAXES" means any federal, state, provincial, county, local,
foreign and other taxes (including, without limitation, income, profits,
windfall profits, alternative, minimum, accumulated earnings, personal holding
company, capital stock, premium, estimated, excise, sales, use, occupancy, gross
receipts, franchise, ad valorem, severance, capital levy, production, transfer,
withholding, employment, unemployment compensation, payroll and property taxes,
import duties and other governmental charges and assessments), whether or not
measured in whole or in part by net income, and including deficiencies,
interest, additions to tax or interest, and penalties with respect thereto, and
including expenses associated with contesting any proposed adjustments related
to any of the foregoing.
"TRADE SECRETS" means any trade secrets, research records,
processes, procedures, manufacturing formulae, technical know-how, technology,
blue prints, designs, plans, inventions (whether patentable and whether reduced
to practice), invention disclosures and improvements thereto.
"TRADEMARKS" means any foreign or United States trademarks,
service marks, trade dress, trade names, brand names, designs and logos,
corporate names, product or service identifiers, whether registered or
unregistered, and all registrations and applications for registration thereof.
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"TRANSFER" has the meaning set forth in Section 8.5(a) of this
Agreement.
"UNAUDITED FINANCIAL STATEMENTS" has the meaning set forth in
Section 3.11 of this Agreement.
"WARRANTS" means, collectively, those warrants, exercisable
for shares of Common Stock, issued pursuant to the Stock and Warrant Purchase
Agreement, dated March 26, 2002, by and among the Company, General Atlantic
Partners 74, L.P., GAP Coinvestment, GmbH Coinvestment and GapStar and those
warrants issued to General Atlantic Partners 74, L.P., GAP Coinvestment, GmbH
Coinvestment and GapStar on July 8, 2003.
ARTICLE II
PURCHASE AND SALE OF COMMON STOCK
2.1 PURCHASE AND SALE OF COMMON STOCK. Subject to the terms
and conditions herein set forth, the Company agrees to issue and sell to each
Purchaser, and each Purchaser, severally and not jointly, agrees to purchase
from the Company, on the Closing Date the aggregate number of shares of Common
Stock determined by dividing (x) the aggregate purchase price set forth opposite
such Purchaser's name on Schedule 2.1 hereto by (y) the Price Per Share (rounded
up to the nearest share), for the aggregate purchase price set forth opposite
such Purchaser's name on Schedule 2.1 hereto (all of the shares of Common Stock
being purchased pursuant to this Section 2.1 being referred to herein as the
"PURCHASED SHARES").
2.2 USE OF PROCEEDS. The Company shall use the proceeds from
the sale of the Purchased Shares to fund the acquisition by the Company of
Planvista pursuant to the Merger Agreement and to fulfill the Company's
obligations under the Merger Agreement.
2.3 CLOSING. Unless this Agreement shall have been terminated
pursuant to Article IX, and subject to the satisfaction or waiver of the
conditions set forth in Articles V and VI, the closing of the sale and purchase
of the Purchased Shares (the "CLOSING") shall take place at the offices of
Holland & Knight LLP, one East Broward Boulevard, Suite 1300, Xxxx Xxxxxxxxxx,
Xxxxxxx 00000, at 10:00 a.m., local time, on the Effective Time of the Merger,
or at such other time, place and date that the Company and the Purchasers
purchasing a majority of the Purchased Shares may agree in writing (the "CLOSING
DATE"). On the Closing Date, the Company shall deliver to each of the Purchasers
a certificate or certificates in definitive form and registered in the name of
each such Purchaser, representing its Purchased Shares.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to each of the Purchasers
on and as of the date hereof as follows:
3.1 CORPORATE EXISTENCE AND POWER. Except as set forth on
SCHEDULE 3.1, the Company and each of its Subsidiaries (a) is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation; (b) has all requisite power and authority to
own and operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently, or is proposed to be, engaged;
and (c) is duly qualified as a foreign corporation, licensed and in good
standing under the laws of each jurisdiction in which its ownership, lease or
operation of property or the conduct of its business requires such
qualification, except where the failure to be so qualified could not reasonably
be expected to have a material adverse effect on the Condition of the Company.
The Company has the corporate power and authority to execute, deliver and
perform its obligations under this Agreement.
3.2 AUTHORIZATION; NO CONTRAVENTION; FBCA SECTIONS 607.0901
AND 607.0902. Except as set forth on SCHEDULE 3.2, the execution, delivery and
performance by the Company of this Agreement and the transactions contemplated
hereby (a) except for receipt of the Stockholder Approval, have been duly
authorized by all necessary corporate action of the Company, including all
actions, consents and approvals required by the Company's Board of Directors and
stockholders; (b) do not contravene the terms of the Certificate of
Incorporation or the By-laws or the organizational documents of any of the
Subsidiaries; (c) do not violate, conflict with or result in any breach, default
or contravention of (or with due notice or lapse of time or both would result in
any breach, default or contravention of), or the creation of any Lien under, any
Contractual Obligation of the Company or any of its Subsidiaries or any
Requirement of Law applicable to the Company or any of its Subsidiaries; and (d)
do not violate any judgment, injunction, writ, award, decree or order of any
nature (collectively, "ORDERS") of any Governmental Authority against, or
binding upon, the Company or any of its Subsidiaries. Section 607.0901 and
Section 607.0902 of the Florida Business Corporation Act are not applicable to
the Company or to any of the transactions contemplated by this Agreement. The
Board of Directors of the Company approved this Agreement and the transactions
contemplated hereby and thereby at a meeting of the Board of Directors duly
convened on December 4, 2003.
3.3 GOVERNMENTAL AUTHORIZATION; THIRD PARTY CONSENTS. Except
as set forth on SCHEDULE 3.3, no approval, consent, compliance, exemption,
authorization or other action by, or notice to, or filing with, any Governmental
Authority or any other Person, and no lapse of a waiting period under a
Requirement of Law, is necessary or required in connection with the execution,
delivery or performance (including, without limitation, the sale, issuance and
delivery of the Purchased Shares) by, or enforcement against, the Company of
this Agreement or the transactions contemplated hereby.
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3.4 BINDING EFFECT. This Agreement has been duly executed and
delivered by the Company, and constitutes the legal, valid and binding
obligations of the Company, enforceable against the Company in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer, moratorium or
similar laws affecting the enforcement of creditors' rights generally and by
general principles of equity relating to enforceability (regardless of whether
considered in a proceeding at law or in equity).
3.5 LITIGATION. Except as set forth on SCHEDULE 3.5, there are
no actions, suits, proceedings, claims (including, without limitation, claims
involving the prior employment of any of the Company's or any of its
Subsidiaries' employees, their use in connection with the Company's or any of
its Subsidiaries' business of any information or techniques allegedly
proprietary to any of their former employers or their obligations under any
agreements with prior employers), complaints, disputes, arbitrations or
investigations (collectively, "CLAIMS") pending or, to the knowledge of the
Company, threatened, at law, in equity, in arbitration or before any
Governmental Authority against the Company or any of its Subsidiaries nor is the
Company or any of its Subsidiaries aware that there is any basis for any of the
foregoing that could reasonably be expected to have a material adverse effect on
the Condition of the Company. No Order has been issued by any court or other
Governmental Authority against the Company or any of its Subsidiaries purporting
to enjoin or restrain the execution, delivery or performance of this Agreement.
3.6 COMPLIANCE WITH LAWS.
(a) Except as set forth on SCHEDULE 3.6(A), the Company and
each of its Subsidiaries is in compliance in all material respects with all
Requirements of Law and all Orders issued by any court or Governmental Authority
against the Company and each of its Subsidiaries. To the knowledge of the
Company, there is no Requirement of Law which could reasonably be expected to
prohibit or restrict the Company or any of its Subsidiaries from, or otherwise
materially adversely effect the Company or any of its Subsidiaries in,
conducting its business in any jurisdiction in which it now conducts its
business.
(b) The Company and each of its Subsidiaries has all material
licenses, permits and approvals of any Governmental Authority (collectively,
"PERMITS") that are necessary for the conduct of the business of the Company and
each of its Subsidiaries; (ii) such Permits are in full force and effect; and
(iii) no violations are or have been recorded in respect of any Permit.
3.7 CAPITALIZATION.
(a) As of the date of this Agreement, the authorized capital
stock of the Company consists of (i) 13,333,333 and 1/3 shares of Common Stock,
of which 6,783,493 shares shall be issued and outstanding and (ii) 2,000,000
shares of preferred stock, par value $0.01 per share, 130,000 of which are
designated as Series A Preferred Stock, 15,000 of which are designated as Series
B Preferred Stock, and 300,000 of which are designated as Series C Preferred
Stock of which no shares of Series A Preferred Stock, no shares of Series B
10
Preferred Stock and 2,000 shares of Series C Preferred Stock are issued and
outstanding and convertible into 13,333 shares of Common Stock and (iv)
1,555,000 shares of which are undesignated "blank check" preferred stock. As of
the date of this Agreement, the aggregate number of options to purchase shares
of Common Stock which may be issued under the Stock Option Plans is 1,648,482 of
which 1,370,080 are outstanding. Except for the Warrants, and except as set
forth on SCHEDULE 3.7(A), there are no options (other than options granted under
the Stock Option Plans), warrants, conversion privileges, subscription or
purchase rights or other rights currently outstanding to purchase or otherwise
acquire (i) any authorized but unissued, unauthorized or treasury shares of the
Company's capital stock, (ii) any Stock Equivalents or (iii) any other
securities of the Company and there are no commitments, contracts, agreements,
arrangements or understandings by the Company to issue any shares of the
Company's capital stock or any Stock Equivalents or other securities of the
Company. No anti-dilution rights of any capital stock or other securities issued
by the Company shall be triggered as a result of the transactions contemplated
hereby. The Purchased Shares are duly authorized, and when issued and sold to
the Purchasers after payment therefor, will be validly issued, fully paid and
non-assessable, will be issued in compliance with the registration and
qualification requirements of all applicable federal, state and foreign
securities laws and will be free and clear of all other Liens. All of the issued
and outstanding shares of Common Stock are duly authorized, validly issued,
fully paid and non-assessable, and were issued in compliance with the
registration and qualification requirements of all applicable federal, state and
foreign securities laws.
(b) SCHEDULE 3.7(B) sets forth, as of the Closing Date, a true
and complete list of (x) each of the Subsidiaries of the Company and (y) the
aggregate number of authorized and issued shares of capital stock of such
Subsidiary. The Company owns all of the issued and outstanding capital stock of
the Subsidiaries, free and clear of all Liens. All of such shares of capital
stock are duly authorized, validly issued, fully paid and non-assessable, and
were issued in compliance with the registration and qualification requirements
of all applicable federal, state and foreign securities laws. There are no
options, warrants, conversion privileges, subscription or purchase rights or
other rights currently outstanding to purchase or otherwise acquire any
authorized but unissued, unauthorized or treasury shares of capital stock or
other securities of, or any proprietary interest in, any of the Subsidiaries,
and there is no outstanding security of any kind convertible into or
exchangeable for such shares or proprietary interest.
3.8 NO DEFAULT OR BREACH; CONTRACTUAL OBLIGATIONS. All of the
Contractual Obligations filed as exhibits or described in the SEC Reports or
which are otherwise material to the Condition of the Company (collectively, the
"MATERIAL CONTRACTUAL OBLIGATIONS") are valid, subsisting, in full force and
effect and binding upon the Company or its Subsidiaries, as the case may be,
and, to the knowledge of the Company, the other parties thereto, and the Company
and each of its Subsidiaries has paid in full or accrued all amounts due
thereunder and has satisfied in full or provided for all of its liabilities and
obligations thereunder. Neither the Company nor any of its Subsidiaries has
received notice of a default or is in default under, or with respect to, any
Material Contractual Obligation nor does any condition exist that with notice or
11
lapse of time or both would constitute a default thereunder. No other party to
any such Material Contractual Obligation is in default thereunder, nor does any
condition exist that with notice or lapse of time or both would constitute a
default by such other party thereunder.
3.9 TITLE TO PROPERTIES AND ASSETS. Except as set forth in
SCHEDULE 3.9, the Company and each of its Subsidiaries holds interests as lessee
under leases in full force and effect in all real property used in connection
with its business or otherwise owned or leased by it. The Company and each of
its Subsidiaries owns and has good, valid, and marketable title to all of the
material properties and assets used in its business and reflected as owned on
the Financial Statements or so described in any Schedule hereto (collectively,
the "Assets"), in each case free and clear of all Liens, except for Liens
specifically described on the notes to the Financial Statements.
3.10 REPORTS; FINANCIAL STATEMENTS. (a) As of the respective
dates of their filing with the Commission, all reports, registration statements
and other filings, together with any amendments thereto, filed by the Company
with the Commission since January 1, 2000 (the "SEC REPORTS"), complied in all
material respects with the applicable requirements of the Securities Act, the
Exchange Act, and the rules and regulations of the Commission promulgated
thereunder. The SEC Reports did not at the time they were filed with the
Commission contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(b) The audited consolidated financial statements of the
Company and its Subsidiaries (balance sheet and statements of operations, cash
flow and stockholders' equity, together with the notes thereto) for the fiscal
year ended December 31, 2002 which contains the unqualified report of
PricewaterhouseCoopers LLP (the "AUDITED FINANCIAL STATEMENTS") and the
unaudited consolidated financial statements of the Company and its Subsidiaries
(balance sheet and statements of operations) for the fiscal quarter ended
September 30, 2003 (the "UNAUDITED FINANCIAL STATEMENTS" and, together with the
Audited Financial Statements, the "FINANCIAL STATEMENTS") set forth in the SEC
Reports are complete and correct in all material respects and have been prepared
in accordance with GAAP applied on a consistent basis throughout the periods
indicated and with each other, except that the Unaudited Financial Statements do
not contain footnotes or normal year-end adjustments. The Financial Statements
fairly present in all material respects the financial condition, operating
results and cash flows of the Company and its Subsidiaries as of the respective
dates and for the respective periods indicated in accordance with GAAP, except
that the Unaudited Financial Statements do not contain footnotes or normal
year-end adjustments.
3.11 TAXES. Except as set forth in SCHEDULE 3.11, (a) The
Company and each of its Subsidiaries has paid all material Taxes which have come
due and are required to be paid by it through the date hereof, and all
deficiencies or other additions to Tax, interest and penalties owed by it in
connection with any such Taxes, other than Taxes being disputed by the Company
and each of its Subsidiaries in good faith for which adequate reserves have been
made in accordance with GAAP; (b) the Company and each of its Subsidiaries has
12
timely filed or caused to be filed all returns for Taxes that it is required to
file on and through the date hereof (including all applicable extensions), and
all such Tax returns are accurate and complete in all material respects; (c)
with respect to all Tax returns of the Company and each of its Subsidiaries, (i)
to the knowledge of the Company, there is no unassessed Tax deficiency proposed
or, to the knowledge of the Company or any of its Subsidiaries, threatened
against the Company or any of its Subsidiaries and (ii) no audit is in progress
with respect to any return for Taxes, no extension of time is in force with
respect to any date on which any return for Taxes was or is to be filed and no
waiver or agreement is in force for the extension of time for the assessment or
payment of any Tax; (d) all provisions for Tax liabilities of the Company and
each of its Subsidiaries with respect to the Financial Statements have been made
in accordance with GAAP consistently applied; and (e) there are no Liens for
Taxes on the assets of either the Company or any of its Subsidiaries.
3.12 NO MATERIAL ADVERSE CHANGE; ORDINARY COURSE OF BUSINESS.
Except as set forth in SCHEDULE 3.12 or in the SEC Reports filed prior to the
date hereof, since December 31, 2002, (a) there has not been any material
adverse change in the Condition of the Company, (b) the Company and each of its
Subsidiaries has not participated in any transaction material to the Condition
of the Company which is outside the ordinary course of business, (c) the Company
and each of its Subsidiaries has not increased the compensation of any of its
officers or the rate of pay of any of its employees, except as part of regular
compensation increases in the ordinary course of business, (d) the Company and
each of its Subsidiaries has not created or assumed any Lien on a material asset
of the Company or any of its Subsidiaries, and (e) there has not occurred a
material change in the Company's or any of its Subsidiaries' accounting
principles or practice except as required by reason of a change in GAAP.
3.13 PRIVATE OFFERING. No form of general solicitation or
general advertising was used by the Company or its representatives in connection
with the offer or sale of the Purchased Shares. Assuming the accuracy of the
representations and warranties of the Purchasers set forth in Article IV, no
registration of the Purchased Shares, pursuant to the provisions of the
Securities Act or any state securities or "blue sky" laws, will be required by
the offer, sale or issuance of the Purchased Shares. The Company agrees that
neither it, nor anyone acting on its behalf, shall offer to sell the Purchased
Shares or any other securities of the Company so as to require the registration
of the Purchased Shares pursuant to the provisions of the Securities Act or any
state securities or "blue sky" laws, unless such Purchased Shares or other
securities are so registered.
3.14 LABOR RELATIONS. Except as could not reasonably be
expected to have a material adverse effect on the Condition of the Company, (a)
neither the Company nor any of its Subsidiaries is engaged in any unfair labor
practice; (b) there is no strike, labor dispute, slowdown or stoppage pending
or, to the knowledge of the Company, threatened against the Company or any of
its Subsidiaries; and (c) neither the Company nor any of its Subsidiaries is a
party to any collective bargaining agreement or contract.
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3.15 EMPLOYEE BENEFIT PLANS.
(a) The SEC Reports disclose or describe each Company Plan
that is required to be disclosed or described in such SEC Reports pursuant to
the Exchange Act and the Securities Act. The Company and each of its
Subsidiaries has no liability under any Plans other than the Company Plans.
Except as disclosed in the SEC Reports, neither the Company, its Subsidiaries
nor any Commonly Controlled Entity maintains or contributes to, or has within
the preceding six years maintained or contributed to, or may have any liability
with respect to any Plan subject to Title IV of ERISA or Section 412 of the Code
or any "multiple employer plan" within the meaning of the Code or ERISA. Each
Company Plan (and related trust, insurance contract or fund) has been
established and administered in all material respects in accordance with its
terms, and complies in form and in operation in all material respects with the
applicable requirements of ERISA and the Code and other applicable Requirements
of Law.
(b) No Claim with respect to the administration or the
investment of the assets of any Company Plan (other than routine claims for
benefits) is pending.
(c) Each Company Plan that is intended to be qualified under
Section 401(a) of the Code is so qualified and has been so qualified during the
period since its adoption; and each trust created under any such Plan is exempt
from tax under Section 501(a) of the Code and has been so exempt since its
creation.
(d) The consummation of the transactions contemplated by this
Agreement will not accelerate the time of the payment or vesting of, or increase
the amount of, compensation due to any employee or former employee whether or
not such payment would constitute an "excess parachute payment" under section
280G of the Code.
(e) All material unfunded obligations under any Company Plan
which are required to be reflected on the Financial Statements in accordance
with GAAP have been reflected on the Financial Statements.
3.16 LIABILITIES. The Company and each of its Subsidiaries do
not have any direct or indirect obligation or liability (the "LIABILITIES")
other than (a) Liabilities fully and adequately reflected or reserved against on
the Financial Statements and (b) Liabilities incurred since December 31, 2002 in
the ordinary course of business.
3.17 INTELLECTUAL PROPERTY.
(a) (i) Except as set forth in SCHEDULE 3.17(A), the Company
and each of its Subsidiaries is the owner of all, or has a license under all of,
the material Copyrights, Patents, Trade Secrets, Trademarks, Internet Assets,
Software and other proprietary rights (collectively, "INTELLECTUAL PROPERTY")
that are used in connection with its business as presently conducted, free and
clear of all Liens.
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(ii) None of the Intellectual Property owned by the
Company or any of its Subsidiaries is subject to any outstanding Order, and no
action, suit, proceeding, hearing, investigation, charge, complaint, claim or
demand is pending or, to the knowledge of the Company, threatened, which
challenges the validity, enforceability, use or ownership of the item.
(iii) The Company and each of its Subsidiaries has
substantially performed all material obligations imposed upon it under any
material license, material sublicenses, material distribution agreement or other
material agreement relating to any Intellectual Property not owned by the
Company or any of its Subsidiaries, and is not, nor to the knowledge of the
Company, is any other party thereto, in material breach of any material terms or
default of any material terms thereunder in any respect, nor is there any event
which with notice or lapse of time or both would constitute a default
thereunder. All such Intellectual Property licenses are valid, enforceable and
in full force and effect, and will continue to be so on identical terms
immediately following the Closing except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or similar laws affecting the enforcement of creditors'
rights generally and by general principles of equity relating to enforceability
(regardless of whether considered in a proceeding at law or in equity).
(iv) Except as set forth in SCHEDULE 3.17(A) and
except as disclosed in the SEC Reports, none of the Intellectual Property
currently sold or licensed by the Company or any of its Subsidiaries to any
Person, or, to the knowledge of the Company, used by or licensed to the Company
or any of its Subsidiaries by any Person, infringes in any material respect upon
or otherwise violates in any material respect any Intellectual Property rights
of others.
(v) Except as disclosed in the SEC Reports, no
litigation is pending and no Claim has been made against the Company or any of
its Subsidiaries or, to the knowledge of the Company, is threatened, contesting
the right of the Company or any of its Subsidiaries to sell or license to any
Person or use the Intellectual Property presently sold or licensed to such
Person or used by the Company or any of its Subsidiaries.
(b) Except as set forth on SCHEDULE 3.17(B) or as disclosed in
the SEC Reports, to the knowledge of the Company, no Person is infringing upon
or otherwise violating the Intellectual Property rights of the Company or any of
its Subsidiaries.
(c) No former employer of any employee of the Company or any
of its Subsidiaries, and no client of any consultant of the Company or any of
its Subsidiaries, has made a claim against the Company or any of its
Subsidiaries or, to the knowledge of the Company, against any other Person, that
such employee or such consultant is utilizing Intellectual Property of such
former employer or client.
(d) Except as set forth on SCHEDULE 3.17(D), to the knowledge
of the Company, no employee of the Company or any of its Subsidiaries is in
violation of any employment agreement, patent or invention disclosure agreement
15
or other contract or agreement setting forth the terms of employment of such
employee with the Company or any of its Subsidiaries or any prior employer.
(e) Except as set forth on SCHEDULE 3.17(E), to the knowledge
of the Company, none of the material Trade Secrets of the Company, wherever
located, the value of which is contingent upon maintenance of confidentiality
thereof, has been disclosed to any Person other than employees, representatives
and agents of the Company or any of its Subsidiaries or to other Persons who
have executed appropriate nondisclosure agreements, except as required pursuant
to the filing of a patent application by the Company or any of its Subsidiaries.
(f) All present key employees of the Company and each of its
Subsidiaries have executed and delivered invention agreements with the Company
and each of its Subsidiaries, and are obligated under the terms thereof to
assign all inventions made by them during the course of employment to the
Company and each of its Subsidiaries. No such employee or present consultant of
the Company or any of its Subsidiaries has excluded works or inventions used by
the Company but made prior to his employment with, or work for, the Company or
any of its Subsidiaries from his assignment of inventions pursuant to such
proprietary invention agreements.
3.18 NETWORK REDUNDANCY AND COMPUTER BACK-UP. Except as could
not reasonably be expected to have a material adverse effect on the Condition of
the Company, the Company and each of its Subsidiaries has made back-ups of all
material computer Software and databases utilized by it and maintain such
Software and databases at a secure off-site location.
3.19 PRIVACY OF CUSTOMER INFORMATION. Except as set forth on
SCHEDULE 3.19, neither the Company nor any of its Subsidiaries uses any of the
customer information it receives through its website or otherwise in a manner
violative in any material respect of the Company's or any of its Subsidiaries'
privacy policy or the privacy rights of its customers under applicable law.
3.20 POTENTIAL CONFLICTS OF INTEREST. Except as set forth on
SCHEDULE 3.20, or as disclosed in the SEC Reports, to the knowledge of the
Company, no officer or director of the Company, no stockholder Beneficially
Owning in excess of five percent of the outstanding Common Stock, and no spouse
of any such officer or director (a) owns, directly or indirectly, any interest
in (excepting less than one percent (1%) stock holdings for investment purposes
in securities of publicly held and traded companies), or is an officer,
director, employee or consultant of, any Person which is, or is engaged in
business as, a competitor, lessor, lessee, supplier, distributor, sales agent or
customer of, or lender to or borrower from, the Company or any of its
Subsidiaries; or (b) owns, directly or indirectly, in whole or in part, any
tangible or intangible property material to the conduct of the business of the
Company or its Subsidiaries.
3.21 TRADE RELATIONS. Except as set forth in SCHEDULE 3.21,
there exists no actual or, to the knowledge of the Company or any of its
Subsidiaries, threatened termination, cancellation or limitation of, or any
16
adverse change in, the business relationship of the Company or any of its
Subsidiaries with any customer or supplier or any group of customers or
suppliers whose purchases or inventories provided to the Company's and each of
its Subsidiaries' business are individually or in the aggregate material to the
Condition of the Company.
3.22 BROKER'S, FINDER'S OR SIMILAR FEES. Except as set forth
on SCHEDULE 3.22, there are no brokerage commissions, finder's fees or similar
fees or commissions payable by the Company or any of its Subsidiaries in
connection with the transactions contemplated hereby based on any agreement,
arrangement or understanding with the Company or any of its Subsidiaries or any
action taken by any such Person.
3.23 STOCKHOLDER APPROVAL. The approval of the holders of a
majority of the outstanding shares of the Company's Common Stock, present in
person or proxy at a properly convened meeting of the Company's stockholders
(the "STOCKHOLDER APPROVAL"), is the sole stockholder consent required for (i)
the issuance and sale of the Purchased Shares to the Purchasers in accordance
with this Agreement, (ii) the consummation of the Merger in accordance with the
Merger Agreement and (iii) the consummation of the other transactions
contemplated by this Agreement and the Merger Agreement.
3.24 TRUE AND COMPLETE COPY OF MERGER AGREEMENT AND OTHER
TRANSACTION-RELATED AGREEMENTS. The Company has delivered to each of the
Purchasers a true, correct and complete copy of the Merger Agreement and all
other agreements related thereto or to the transactions contemplated thereby,
including without limitation, the Merger (collectively, the "ACQUISITION
DOCUMENTS"). The Acquisition Documents (i) have been executed in the exact form
as provided, (ii) have not been amended or modified and (iii) are in full force
and effect. Each of the representations and warranties of the Company made in
Article IV of the Merger Agreement are true and correct in all material
respects.
3.25 REGISTRATION RIGHTS. The Purchased Shares purchased by
GAP LP, GAP Coinvestment, GapStar and GmbH Coinvestment shall be Registerable
Securities.
3.26 OBSERVANCE OF COVENANTS. The Company has not failed to
observe or perform any of the covenants set forth in Article VIII of the Stock
and Warrant Purchase Agreement, except that the Board of Directors of the
Company is comprised of eight members. Subject to Section 10.5 hereof, all of
such covenants are in full force and effect and remain binding upon the Company.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each of the Purchasers hereby represents and warrants,
severally and not jointly, to the Company as follows:
17
4.1 EXISTENCE AND POWER. Such Purchaser (a) is a limited
partnership or limited liability company, as the case may be, duly organized and
validly existing under the laws of the jurisdiction of its formation and (b) has
the requisite partnership or limited liability company, as the case may be,
power and authority to execute, deliver and perform its obligations under this
Agreement.
4.2 AUTHORIZATION; NO CONTRAVENTION. The execution, delivery
and performance by such Purchaser of this Agreement and the transactions
contemplated hereby (a) have been duly authorized by all necessary partnership
or limited liability company, as the case may be, action, (b) do not contravene
the terms of such Purchaser's organizational documents, or any amendment
thereof, and (c) do not violate, conflict with or result in any breach or
contravention of, or the creation of any Lien under, any Contractual Obligation
of such Purchaser or any Requirement of Law applicable to such Purchaser (except
for the Lien created on the Purchased Shares purchased by GapStar to secure its
obligations under a bona fide loan made to acquire such Purchased Shares), and
(d) do not violate any Orders of any Governmental Authority against, or binding
upon, such Purchaser.
4.3 GOVERNMENTAL AUTHORIZATION; THIRD PARTY CONSENTS. No
approval, consent, compliance, exemption, authorization or other action by, or
notice to, or filing with, any Governmental Authority or any other Person, and
no lapse of a waiting period under any Requirement of Law, is necessary or
required in connection with the execution, delivery or performance (including,
without limitation, the purchase of the Purchased Shares) by, or enforcement
against, such Purchaser of this Agreement or the transactions contemplated
hereby.
4.4 BINDING EFFECT. This Agreement has been duly executed and
delivered by such Purchaser and constitutes the legal, valid and binding
obligations of such Purchaser, enforceable against it in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer, moratorium or
similar laws affecting the enforcement of creditors' rights generally or by
equitable principles relating to enforceability (regardless of whether
considered in a proceeding at law or in equity).
4.5 PURCHASE FOR OWN ACCOUNT. The Purchased Shares to be
acquired by such Purchaser pursuant to this Agreement are being acquired for its
own account for investment only, and not with a view to, or for sale in
connection with, any distribution of such Purchased Shares or any part thereof
in any transaction that would be in violation of the securities laws of the
United States of America, any state of the United States or any foreign
jurisdiction. Such Purchaser understands and agrees that such Purchased Shares
have not been registered under the Securities Act and are "restricted
securities" within the meaning of Rule 144 under the Securities Act; and that
the Purchased Shares cannot be sold, transferred or otherwise disposed of except
in compliance with the Securities Act and applicable state and foreign
securities laws, as then in effect. Such Purchaser agrees to the imprinting of a
legend on certificates representing all of its Purchased Shares to the following
effect:
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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY FOREIGN JURISDICTION.
THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH REGISTRATION IS NOT
REQUIRED.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS UPON TRANSFER PURSUANT TO A STOCK PURCHASE AGREEMENT DATED AS OF
DECEMBER 5, 2003, AS MAY BE AMENDED FROM TIME TO TIME. A COPY OF THE STOCK
PURCHASE AGREEMENT MAY BE OBTAINED FROM THE COMPANY WITHOUT CHARGE UPON THE
WRITTEN REQUEST OF THE HOLDER HEREOF.
4.6 RESTRICTED SECURITIES. Such Purchaser understands that the
Purchased Shares will not be registered at the time of their issuance under the
Securities Act for the reason that the sale provided for in this Agreement is
exempt pursuant to Section 4(2) of the Securities Act and that the reliance of
the Company on such exemption is predicated in part on such Purchaser's
representations set forth herein.
4.7 BROKER'S, FINDER'S OR SIMILAR FEES. There are no brokerage
commissions, finder's fees or similar fees or commissions payable by such
Purchaser in connection with the transactions contemplated hereby based on any
agreement, arrangement or understanding with such Purchaser or any action taken
by such Purchaser.
4.8 ACCREDITED INVESTOR. Such Purchaser is an "Accredited
Investor" within the meaning of Rule 501 of Regulation D under the Securities
Act, as presently in effect.
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ARTICLE V
CONDITIONS TO THE OBLIGATION
OF THE PURCHASERS TO CLOSE
The obligation of each of the Purchasers to purchase the
Purchased Shares, to pay the purchase price therefor at the Closing and to
perform any obligations hereunder shall be subject to the satisfaction as
determined by, or waiver by, the Purchasers purchasing a majority of the
Purchased Shares of the following conditions on or before the Closing Date.
5.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company contained in Article III hereof shall be true and
correct in all material respects (except for any such representations and
warranties which are qualified by their terms by a reference to materiality or
material adverse effect, which representation as so qualified shall be true and
correct in all respects) at and on the Closing Date as if made at and on such
date, except where the failure of such representations or warranties to be true
or correct would not have, individually or in the aggregate, a Material Adverse
Effect, and, to the knowledge of the Company, each of the representations and
warranties of Planvista contained in Article III of the Merger Agreement shall
be true and correct, except where the failure of such representations or
warranties to be true or correct would not have, individually or in the
aggregate, a Company Material Adverse Effect (as defined in the Merger
Agreement).
5.2 COMPLIANCE WITH THIS AGREEMENT. The Company shall have
performed and complied in all material respects with all of its agreements set
forth herein that are required to be performed by the Company on or before the
Closing Date.
5.3 OFFICER'S CERTIFICATE. The Purchasers shall have received
a certificate from the Company, in form and substance satisfactory to the
Purchaser, dated the Closing Date, and signed by the Chief Executive Officer and
Chief Financial Officer of the Company, certifying as to the matters set forth
in Section 5.1 and 5.2.
5.4 SECRETARY'S CERTIFICATE. The Purchasers shall have
received a certificate from the Company, in form and substance satisfactory to
the Purchasers purchasing a majority of the Purchased Shares, dated the Closing
Date and signed by the Secretary of the Company, certifying (a) that the Company
is in good standing with the Secretary of State of the State of Florida, (b)
that the attached copies of the Articles of Incorporation, the By-laws,
resolutions of the Board of Directors approving this Agreement and the
transactions contemplated hereby and thereby, are all true, complete and correct
and remain unamended and in full force and effect, and (c) as to the incumbency
and specimen signature of each officer of the Company executing this Agreement
and any other document delivered in connection herewith on behalf of the
Company.
5.5 PURCHASED SHARES. The Company shall have delivered to each
of the Purchasers certificates in definitive form representing the number of
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Purchased Shares set forth opposite such Purchaser's name on Schedule 2.1
hereto, registered in the name of such Purchaser.
5.6 OPINION OF COUNSEL. The Purchasers shall have received an
opinion of Holland & Knight LLP, dated the Closing Date, relating to the
transactions contemplated by or referred to herein, substantially in the form
attached hereto as Exhibit A.
5.7 NASD. The Purchased Shares shall have been approved for
quotation on the Nasdaq Stock Market, Inc.
5.8 STOCKHOLDER APPROVAL. The Company shall have received the
Stockholder Approval and the Purchasers shall have received satisfactory
evidence thereof.
5.9 AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT. The
Company shall have duly executed and delivered to the Purchasers the Amended and
Restated Registration Rights Agreement substantially in the form attached hereto
as Exhibit B (the "AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT").
5.10 NO MATERIAL ADVERSE CHANGE. Since the date hereof, there
shall not have occurred any event, change or effect having, individually or in
the aggregate, a Material Adverse Effect.
5.11 CONSENTS AND APPROVALS. All consents, exemptions,
authorizations, or other actions by, or notice to, or filings with, Governmental
Authorities and other Persons in respect of all Requirements of Law and with
respect to those Contractual Obligations of the Company which are necessary or
required in connection with the execution, delivery or performance by, or
enforcement against, the Company of this Agreement shall have been obtained and
be in full force and effect, and the Purchasers shall have been furnished with
appropriate evidence thereof and all applicable waiting periods shall have
expired without any action being taken or threatened which would have a material
adverse effect on the Condition of the Company.
5.12 NO MATERIAL JUDGMENT OR ORDER. There shall not be on the
Closing Date any Order of a court of competent jurisdiction or any ruling of any
Governmental Authority or any condition imposed under any Requirement of Law
which would, in the reasonable judgment of the Purchasers purchasing a majority
of the Purchased Shares, (a) prohibit or restrict (i) the purchase of the
Purchased Shares or (ii) the consummation of the other transactions contemplated
by this Agreement, (b) subject any of the Purchasers to any material penalty or
onerous condition under or pursuant to any Requirement of Law if the Purchased
Shares were to be purchased hereunder or (c) restrict the operation of the
business of the Company as conducted on the date hereof in a manner that would
have a Material Adverse Effect.
5.13 NO LITIGATION. No action, suit, proceeding, claim or
dispute shall have been brought or otherwise arisen at law, in equity, in
arbitration or before any Governmental Authority against the Company which
21
would, if adversely determined (a) have a material adverse effect on the
Condition of the Company or (b) have a Material Adverse Effect.
5.14 SATISFACTION OF CONDITIONS; CONSUMMATION OF THE MERGER.
(a) All conditions to the obligation of each party to the
Merger Agreement to effect the Merger thereunder shall have been satisfied.
(b) The Merger shall have been consummated in accordance with
the Merger Agreement.
ARTICLE VI
CONDITIONS TO THE OBLIGATION OF THE COMPANY
AND THE SELLING STOCKHOLDERS TO CLOSE
The obligation of the Company to issue and sell the Purchased
Shares and the obligations of the Company to perform its other obligations
hereunder shall be subject to the satisfaction as determined by, or waiver by,
the Company of the following conditions on or before the Closing Date:
6.1 PAYMENT OF PURCHASE PRICE. Each Purchaser shall be
prepared to pay, by wire transfer, the aggregate purchase price for the
Purchased Shares to be purchased by such Purchaser.
6.2 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Purchasers contained in Article IV hereof shall be true and
correct in all material respects (except for any such representations and
warranties which are qualified by their terms by a reference to materiality or
material adverse effect, which representation as so qualified shall be true and
correct in all respects) at and on the Closing Date as if made at and on such
date.
6.3 STOCKHOLDER APPROVAL. The Company shall have received the
Stockholder Approval.
6.4 SATISFACTION OF CONDITIONS. All conditions to the
obligation of each party to the Merger Agreement to effect the Merger thereunder
shall have been satisfied.
ARTICLE VII
INDEMNIFICATION
7.1 INDEMNIFICATION. Subject to the limitations set forth in
Section 7.4, the Company (the "INDEMNIFYING PARTY") agrees to indemnify, defend
and hold harmless each of the Purchasers and its Affiliates and their respective
officers, managers, directors, agents, employees, subsidiaries, partners,
members and controlling persons (each, an "INDEMNIFIED PARTY") to the fullest
extent permitted by law from and against any and all losses, Claims, or written
threats thereof (including, without limitation, any Claim by a third party),
22
damages, expenses (including reasonable fees, disbursements and other charges of
counsel incurred by the Indemnified Party in any action between the Company
Indemnifying Party and the Indemnified Party or between the Indemnified Party
and any third party (other than a third party who is an Affiliate of such
Indemnified Party) or otherwise in the manner described in Section 7.2 below) or
other liabilities (collectively, "LOSSES") resulting from or arising out of any
breach of any representation or warranty, covenant or agreement by the Company
in this Agreement. In connection with the obligation of the Indemnifying Party
to indemnify for expenses as set forth above, the Indemnifying Party shall, upon
presentation of appropriate invoices containing reasonable detail, reimburse
each Indemnified Party for all such expenses (including reasonable fees,
disbursements and other charges of counsel incurred by the Indemnified Party in
any action between the Indemnifying Party and the Indemnified Party or between
the Indemnified Party and any third party (other than a third party who is an
Affiliate of such Indemnified Party) as they are incurred by such Indemnified
Party; provided, however, that if an Indemnified Party is reimbursed under this
Article VII for any expenses, such reimbursement of expenses shall be refunded
to the extent it is finally judicially determined that such expenses resulted
solely from the gross negligence or willful misconduct of such Indemnified
Party.
7.2 NOTIFICATION. Each Indemnified Party under this Article
VII shall, promptly after the receipt of notice of the commencement of any Claim
against such Indemnified Party in respect of which indemnity may be sought from
the Indemnifying Party under this Article VII, notify the Indemnifying Party in
writing of the commencement thereof. The omission of any Indemnified Party to so
notify the Indemnifying Party of any such action shall not relieve the
Indemnifying Parties from any liability which it may have to such Indemnified
Party (a) other than pursuant to this Article VII or (b) under this Article VII
unless, and only to the extent that, such omission results in such Indemnifying
Party's forfeiture of substantive rights or defenses. In case any such Claim
shall be brought against any Indemnified Party, and it shall notify the
Indemnifying Party of the commencement thereof, the Indemnifying Party shall be
entitled to assume the defense thereof at their own expense, with counsel
satisfactory to such Indemnified Party in its reasonable judgment; provided that
any Indemnified Party may, at its own expense, retain separate counsel to
participate in such defense at its own expense. Notwithstanding the foregoing,
in any Claim in which both the Indemnifying Party, on the one hand, and an
Indemnified Party, on the other hand, are, or are reasonably likely to become, a
party, such Indemnified Party shall have the right to employ separate counsel
and to control its own defense of such Claim if, in the reasonable opinion of
counsel to such Indemnified Party, either (x) one or more defenses are available
to the Indemnified Party that are not available to the Indemnifying Parties or
(y) a conflict or potential conflict exists between the Indemnifying Party, on
the one hand, and such Indemnified Party, on the other hand, that would make
such separate representation advisable; provided, however, that the Indemnifying
23
Party (i) shall not be liable for the fees and expenses of more than one counsel
to all Indemnified Parties and (ii) shall reimburse the Indemnified Parties for
all of such fees and expenses of such counsel, as such fees and expenses are
incurred. The Indemnifying Party agrees that it will not, without the prior
written consent of the Purchasers purchasing a majority of the Purchased Shares,
settle, compromise or consent to the entry of any judgment in any pending or
threatened Claim relating to the matters contemplated hereby (if any Indemnified
Party is a party thereto or has been actually threatened to be made a party
thereto) unless such settlement, compromise or consent includes an unconditional
release of each Indemnified Party from all liability arising or that may arise
out of such Claim. The Indemnifying Party shall not be liable for any settlement
of any Claim effected against an Indemnified Party without its written consent,
which consent shall not be unreasonably withheld. The rights accorded to an
Indemnified Party hereunder shall be in addition to any rights that any
Indemnified Party may have at common law, by separate agreement or otherwise;
provided, however, that notwithstanding the foregoing or anything to the
contrary contained in this Agreement, nothing in this Article VII shall restrict
or limit any rights that any Indemnified Party may have to seek equitable
relief.
7.3 CONTRIBUTION. If the indemnification provided for in this
Article VII from an Indemnifying Party is unavailable to an Indemnified Party
hereunder in respect of any Losses for which such Indemnified Party would
otherwise be required to indemnify the Indemnified Party under this Article VII,
then such Indemnifying Party, in lieu of indemnifying such Indemnified Party,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such Losses in such proportion as is appropriate to reflect the
relative fault of such Indemnifying Party and Indemnified Party in connection
with the actions which resulted in such Losses, as well as any other relevant
equitable considerations. The relative faults of such Indemnifying Party and
Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such Indemnifying Party or
Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of the Losses referred to above shall be
deemed to include any legal or other fees, charges or expenses reasonably
incurred by such party in connection with any investigation or proceeding.
7.4 CAP ON INDEMNIFICATION. The amount of any payment by the
Indemnifying Party to the Indemnified Parties under this Article VII in respect
of Losses resulting from or arising out of any indemnification claim made
pursuant to Section 7.1 shall in no event exceed the aggregate purchase price
paid to the Company in consideration of the Purchased Shares.
ARTICLE VIII
COVENANTS OF THE COMPANY
The Company hereby covenants and agrees with the Purchasers as
follows:
8.1 INTERIM ACTIONS. From and after the date hereof through
and until the Closing, the Company shall not, except as contemplated by this
Agreement, and shall cause each of its Subsidiaries not to, take any action or
24
fail to take any action that has the purpose or effect of obstructing, hindering
or delaying the issuance and sale of the Purchased Shares to the Purchasers in
accordance with this Agreement or any of the other transactions contemplated
hereby; PROVIDED, HOWEVER, that the foregoing shall not prevent the Company from
terminating the Merger Agreement in accordance with its terms or otherwise
exercising its rights and performing its obligations under the Merger Agreement.
8.2 STOCKHOLDER APPROVAL.
(a) As soon as practicable following the date hereof, the
Company will prepare and file with the Commission a proxy statement to be
distributed to the Company's stockholders in connection with the solicitation of
votes in favor of the Stockholder Approval (as amended or supplemented from time
to time, the "Proxy Statement"). The Company shall use its reasonable best
efforts to (i) respond as promptly as practicable to any comments of the
Commission with respect thereto (ii) have or cause the Proxy Statement to be
cleared by the Commission as promptly as practicable and (iii) cause the Proxy
Statement to be mailed to the Company's stockholders as promptly as practicable
thereafter. The Company shall promptly notify each of the Purchasers upon the
receipt of comments from the Commission or its staff or any request from the
Commission or its staff for amendments or supplements to the Proxy Statement and
shall provide each of the Purchasers with copies of all correspondence between
the Company and its representatives, on the one hand, and the Commission and its
staff, on the other hand. Notwithstanding the foregoing, prior to filing or
mailing the Proxy Statement (or any amendment or supplement thereto) or
responding to any comments of the Commission with respect thereto, the Company
(x) shall provide each of the Purchasers with an opportunity to review and
comment on such document or response, (y) shall include in such document or
response all comments reasonably proposed by the Purchasers and (z) shall not
file or mail such document or respond to the Commission prior to receiving the
approval of the Purchasers purchasing a majority of the Purchased Shares, which
approval shall not unreasonably be withheld or delayed. The Company shall use
its reasonable best efforts to cause the Proxy Statement to comply in all
material respects with the applicable provisions of the Exchange Act and the
rules and regulations promulgated thereunder, including without limitation,
Section 14(a) thereof.
(b) Following the clearance by the Commission of the Proxy
Statement and upon the mailing thereof to the Company's stockholders, the
Company shall call and arrange for a special meeting of the stockholders of the
Company and take such other actions necessary to obtain the Stockholder Approval
as promptly as practicable. Unless there has been a Parent Change of
Recommendation (as such term is defined in the Merger Agreement), the Company
shall, through its Board of Directors, recommend to its stockholders that they
approve and authorize the issuance and sale of the Purchased Shares to the
Purchasers in accordance with this Agreement.
25
8.3 THE ACQUISITION. The Company acknowledges that the
Purchasers have entered into this Agreement in reliance upon the fact that the
Company shall consummate the transactions contemplated by the Merger Agreement.
8.4 AMENDMENT OF ACQUISITION DOCUMENTS. From and after the
date hereof through and until the Effective Time of the Merger, without the
prior written consent of the Purchasers purchasing a majority of the Purchased
Shares which shall not be unreasonably withheld or delayed, the Company shall
not, and shall cause its Subsidiaries not to, amend, modify or waive any
provision of the Merger Agreement or any other Acquisition Document.
8.5 RESTRICTION ON TRANSFER OF SECURITIES.
(a) Each of the Purchasers and GAP 74 hereby agrees not to,
directly or indirectly, sell, offer, contract or grant any option to sell
(including without limitation any short sale), pledge, transfer, establish an
open "put equivalent position" within the meaning of Rule 16a-1(h) under the
Exchange Act or otherwise dispose (each, a "TRANSFER") of, any Restricted Shares
prior to the first anniversary of the Closing Date, except (i) GAP LP, GAP
Coinvestment, GapStar, GMBH Coinvestment and GAP 74 may Transfer, in the
aggregate, so many Restricted Shares in any three month period as would be
permitted pursuant to Rule 144(e)(1)(i) promulgated by the Commission under the
Securities Act (as in effect on the date hereof) whether or not Rule
144(e)(1)(i) is applicable and whether or not the other conditions set forth in
Rule 144 are satisfied, (ii) PVC, ComVest, Xxxx and Xxxxxx may Transfer, in the
aggregate, so many Restricted Shares in any three month period as would be
permitted pursuant to Rule 144(e)(1)(i) promulgated by the Commission under the
Securities Act (as in effect on the date hereof) whether or not Rule
144(e)(1)(i) is applicable and whether or not the other conditions set forth in
Rule 144 are satisfied, (iii) to a Permitted Transferee in accordance with
clause (b) of this Section 8.5 who enters into a written joinder agreement
reasonably acceptable to the Company acknowledging that such Permitted
Transferee is acquiring the Restricted Shares subject to the obligations and
restrictions set forth in this Agreement with respect to such Restricted Shares,
(iv) in connection with a Sale Transaction and (v) any Transfer which has been
approved in advance by the Board of Directors. For the avoidance of doubt, any
Transfer of Restricted Shares pursuant to any of the foregoing clauses (i)
through (v) shall be without duplication of any Transfer of Restricted Shares
pursuant to any other of the foregoing clauses (i) through (v). The Company may
neither waive the foregoing restrictions on Transfer with respect to any of GAP
LP, GAP Coinvestment, GapStar, GMBH Coinvestment or GAP 74 without similarly
waiving the foregoing restrictions on Transfer with respect to PVC, ComVest,
Xxxx or Xxxxxx (allocated among such parties as such parties shall agree) nor
waive the foregoing restrictions on Transfer with respect to PVC, ComVest, Xxxx
or Xxxxxx without similarly waiving the foregoing restrictions on Transfer with
respect to GAP LP, GAP Coinvestment, GapStar, GMBH Coinvestment or GAP 74
(allocated among such parties as such parties shall agree).
26
(b) Notwithstanding anything to the contrary contained in this
Agreement, at any time, (i) each of the Purchasers who is an individual may
Transfer all or any portion of his or its Restricted Shares to or among (x) a
member of such Purchaser's immediate family, which shall include his spouse,
siblings, children or grandchildren ("FAMILY MEMBERS") or (y) a trust,
corporation, partnership or limited liability company, all of the beneficial
interests in which shall be held by such Purchaser or one or more Family Members
of such Purchaser; PROVIDED, HOWEVER, that during the period that any such
trust, corporation, partnership or limited liability company holds any right,
title or interest in any Restricted Shares, no Person other than such Purchaser
or one of more Family Members of such Purchaser may be or may become
beneficiaries, stockholders, limited or general partners or members thereof,
(ii) (A) each of the Purchasers may Transfer all or any portion of its
Restricted Shares to any of its Affiliates, (B) GapStar may pledge and grant a
security interest in all or any portion of its Restricted Shares to a lender to
secure its obligations under a bona fide loan made to acquire such Restricted
Shares and (C) PVC may Transfer all or any portion of its Restricted Shares to
its members (the Persons referred to in the preceding clauses (i) and (ii) are
each referred to hereinafter as a "PERMITTED TRANSFEREE"). A Permitted
Transferee of Restricted Shares pursuant to this Section 8.5(b) may Transfer its
Restricted Shares pursuant to this Section 8.5(b) only to the transferor
Purchaser or to a Person that is a Permitted Transferee of such transferor
Purchaser. No Purchaser shall avoid the provisions of this Agreement by making
one or more Transfers to one or more Permitted Transferees and then disposing of
all or any portion of such party' s interest in any such Permitted Transferee,
and any Transfer or attempted Transfer in violation of this covenant shall be
null and void AB INITIO.
8.6 WAIVER OF ANTI-DILUTION PROVISIONS. Each of PVC, Comvest,
Xxxx and Xxxxxx hereby waives on its own behalf and on behalf of each of its
Affiliates the operation of any anti-dilution or adjustment provisions set forth
in any security or Stock Equivalent of the Company held by such Person as a
result of the issuance of shares of the Common Stock by the Company in
connection with the transactions contemplated by this Agreement and the Merger
Agreement.
ARTICLE IX
TERMINATION OF AGREEMENT
9.1 TERMINATION. This Agreement may be terminated by written
notice prior to the Closing as follows:
(a) at any time on or prior to the Closing Date, by mutual
written consent of the Company and the Purchasers purchasing a majority of the
Purchased Shares;
(b) at the election of the Company or the Purchasers
purchasing a majority of the Purchased Shares by written notice to the other
parties hereto after 5:00 p.m., New York time, on April 30, 2004, if the Closing
shall not have occurred, unless such date is extended by the mutual written
27
consent of the Company and the Purchasers purchasing a majority of the Purchased
Shares; PROVIDED, HOWEVER, that the right to terminate this Agreement under this
Section 9.1(b) shall not be available to any party whose breach of any
representation, warranty, covenant or agreement under this Agreement has been
the cause of, or resulted in, the failure of the Closing to occur on or before
such date;
(c) at the election of the Purchasers purchasing a majority of
the Purchased Shares or the Company, if there has been a material breach of any
representation, warranty, covenant or agreement on the part of the Company
contained in this Agreement, which breach has not been cured within fifteen (15)
days of written notice to the Company of such breach.
(d) at the election of the Company, if there has been a
material breach of any representation, warranty, covenant or agreement on the
part of any of the Purchasers contained in this Agreement, which breach has not
been cured within fifteen (15) days of written notice to the Purchasers of such
breach.
(e) at the election of any of the Purchasers (with respect to
such Purchaser) or the Company, if the Merger Agreement has been terminated.
If this Agreement so terminates, it shall become null and void
and have no further force or effect, except as provided in Section 9.2.
9.2 SURVIVAL. If this Agreement is terminated and the
transactions contemplated hereby are not consummated as described above, this
Agreement shall become void and of no further force and effect, except for the
provisions of Article 1 and this Section 9.2; PROVIDED, HOWEVER, that (a) none
of the parties hereto shall have any liability in respect of a termination of
this Agreement pursuant to Section 9.1(a) or Section 9.1(b) and (b) nothing
shall relieve the Company from liability for actual damages resulting from a
termination of this Agreement pursuant to Section 9.1(c), or Section 9.1(e) if
the Merger Agreement has been terminated pursuant to Section 8.01(h) thereof,
and nothing shall relieve the Purchasers from liability for actual damages
resulting from a termination of this Agreement pursuant to Section 9.1(d); and
PROVIDED, FURTHER, that none of the parties hereto shall have any liability for
speculative, indirect, unforeseeable or consequential damages or lost profits
resulting from any legal action relating to any termination of this Agreement.
ARTICLE X
MISCELLANEOUS
10.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the
representations and warranties made herein shall survive the execution and
delivery of this Agreement until the date that is ninety (90) days after the
receipt by the Purchasers of audited consolidated financial statements of the
Company and its Subsidiaries for the fiscal year ending December 31, 2004 (or,
if such fiscal year changes and no such audited consolidated financial
statements are available, then the successor fiscal year), except for (a)
28
Sections 3.1, 3.2, 3.4, 3.7, 3.13, 3.22, 3.23, 3.24, 3.25 and 3.26, which
representations and warranties shall survive indefinitely and (b) Section 3.11,
which shall survive until the later to occur of (i) the lapse of the statute of
limitations with respect to the assessment of any Tax to which such
representation and warranty relates (including any extensions or waivers
thereof) and (ii) sixty (60) days after the final administrative or judicial
determination of the Taxes to which such representation and warranty relates,
and no claim with respect to Section 3.11 may be asserted thereafter with the
exception of claims arising out of any fact, circumstance, action or proceeding
to which the party asserting such claim shall have given notice to the other
parties to this Agreement prior to the termination of such period of reasonable
belief that a tax liability will subsequently arise therefrom.
10.2 NOTICES. All notices, demands and other communications
provided for or permitted hereunder shall be made in writing and shall be by
registered or certified first-class mail, return receipt requested, telecopier,
courier service or personal delivery:
if to the Company:
ProxyMed, Inc.
0000 Xxxxx Xx., Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Chief Executive Officer
Xxxxxx X. Xxxxxxxxx, In-House Counsel
with a copy to:
Holland & Knight LLP
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Xxxx, Esq.
if to GAP LP, GAP Coinvestment or GapStar:
c/o General Atlantic Service Corporation
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
Xxxxxx X. Xxxxxx
29
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
if to GmbH Coinvestment:
c/o General Atlantic Partners GmbH
Xxxxxxxxxxx 00
00000 Xxxxxxxxxxx
Xxxxxxx
Telecopy: 011-49-211-602-888-89
Attention: Xxxxxxx Xxxxxx
Xxxxxx X. Xxxxxx
with a copy to:
General Atlantic Service Corporation
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
Xxxxxx X. Xxxxxx
and
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
30
if to PVC or ComVest:
c/o ComVest Investment Partners
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxx Xxxxxxxx
with a copy to:
Xxxxxxxxx Traurig LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxx X. Annex
if to Xxxx:
Xxxx Ventures, LLC
000 Xxxx Xxxxxx Xxxx
Xxxxxx, XX 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxx Xxxxx
with a copy to:
Xxxxxxxxx Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxx X. Annex
if to Xxxxxx:
Xxxxxx Xxxxxx
0000 Xxxxxxxxx Xx XX 0000
Xxxxxxx, XX 00000-0000
Telecopy: (000) 000-0000
31
with a copy to:
Xxxxxxxxx Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxx X. Annex
All such notices, demands and other communications shall be
deemed to have been duly given (i) when delivered by hand, if personally
delivered; (ii) one Business Day after being sent, if sent via a reputable
nationwide overnight courier service guaranteeing next business day delivery;
(iii) five (5) Business Days after being sent, if sent by registered or
certified mail, return receipt requested, postage prepaid; and (iv) when receipt
is mechanically acknowledged, if telecopied. Any party may by notice given in
accordance with this Section 10.2 designate another address or Person for
receipt of notices hereunder. Any party may give any notice, request, consent or
other communication under this Agreement using any other means (including,
without limitation, personal delivery, messenger service, first class mail or
electronic mail), but no such notice, request, consent or other communication
shall be deemed to have been duly given unless and until it is actually received
by the party to whom it is given.
10.3 SUCCESSORS AND ASSIGNS; THIRD PARTY BENEFICIARIES. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of the parties hereto. Subject to applicable securities laws
and the terms and conditions thereof, the Purchasers may assign any of their
rights under this Agreement to any of their respective Affiliates. The Company
may not assign any of its rights under this Agreement without the written
consent of the Purchasers purchasing a majority of the Purchased Shares. Except
as provided in Article VII, no Person other than the parties hereto and their
successors and permitted assigns is intended to be a beneficiary of this
Agreement.
10.4 AMENDMENT AND WAIVER.
(a) No failure or delay on the part of the Company or the
Purchasers in exercising any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy.
(b) Any amendment, supplement or modification of or to any
provision of this Agreement, any waiver of any provision of this Agreement, and
any consent to any departure by the Company or the Purchasers from the terms of
any provision of this Agreement, shall be effective (i) only if it is made or
given in writing and signed by the Company and the Purchasers purchasing a
majority of the Purchased Shares, and (ii) only in the specific instance and for
the specific purpose for which made or given. Except where notice is
specifically required by this Agreement, no notice to or demand on the Company
in any case shall entitle the Company to any other or further notice or demand
in similar or other circumstances.
32
10.5 AMENDMENT TO STOCK AND WARRANT PURCHASE AGREEMENT. The
Stock and Warrant Purchase Agreement is hereby amended by deleting Section 8.5
thereof in its entirety.
10.6 COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
10.7 HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
10.8 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICTS OF LAW THEREOF.
10.9 SEVERABILITY. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions hereof shall not be in any way impaired, unless the
provisions held invalid, illegal or unenforceable shall substantially impair the
benefits of the remaining provisions hereof.
10.10 RULES OF CONSTRUCTION. Unless the context otherwise
requires, references to sections or subsections refer to sections or subsections
of this Agreement.
10.11 ENTIRE AGREEMENT. This Agreement, together with the
exhibits and schedules hereto, is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein and therein. There are no restrictions, promises,
representations, warranties or undertakings, other than those set forth or
referred to herein or therein. This Agreement, together with the exhibits and
schedules hereto, supersedes all prior agreements and understandings between the
parties with respect to such subject matter.
10.12 FEES. Upon the Closing, the Company shall reimburse GAP
LP, GAP Coinvestment, GapStar and GMBH Coinvestment for their fees,
disbursements and other charges of counsel incurred in connection with the
transactions contemplated by this Agreement, provided that the amount of such
reimbursement shall not exceed in the aggregate $50,000.
10.13 PUBLIC ANNOUNCEMENTS. Following the date hereof, the
Company shall be permitted to issue a press release relating to this Agreement
and the transactions contemplated thereby. The Purchasers shall have the
opportunity to review and comment on such press release prior to its issuance,
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which review and comment shall be provided as expeditiously as possible and in
any event within 48 hours of delivery of such press release by the Company to
the Purchasers, and such press release shall be in form and substance reasonably
satisfactory to the Purchasers purchasing a majority of the Purchased Shares.
Except as set forth in the previous sentence, neither the Company nor the
Purchasers will issue any press release or make any public statements with
respect to this Agreement or the transactions contemplated hereby without the
prior written consent of the other parties hereto, except to the extent such
party reasonably believes such press release or public statement is required by
applicable law or stock market regulations; provided, however, that the Company
and the Purchasers may make reasonable public statements consistent with prior
public statements otherwise permitted under this Section 10.13; and provided
further, that GAP LLC may disclose on its worldwide web page,
xxx.xxxxxxxxxx.xxx, the name of the Company, the name of the Chief Executive
Officer of the Company, a brief description of the business of the Company, the
Company's logo and the aggregate amount of the Purchasers' investment in the
Company. Notwithstanding the foregoing, the Company will not use or refer to the
name of any Purchaser in any public statement or disclosure without the consent
of such Purchaser except to the extent that such party reasonably believes such
statement or disclosure is required by applicable law or stock market
regulations.
10.14 FURTHER ASSURANCES. Each of the parties shall execute
such documents and perform such further acts (including, without limitation,
obtaining any consents, exemptions, authorizations or other actions by, or
giving any notices to, or making any filings with, any Governmental Authority or
any other Person) as may be reasonably required or desirable to carry out or to
perform the provisions of this Agreement.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the undersigned have executed, or have
caused to be executed, this Stock Purchase Agreement on the date first written
above.
PROXYMED, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chairman and CEO
GENERAL ATLANTIC PARTNERS 77, L.P.
By: GENERAL ATLANTIC PARTNERS, LLC,
its General Partner
By: /s/ Xxxxxx X. Xxxxx
------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: A Managing Member
GAP COINVESTMENT PARTNERS II, L.P.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: A General Partner
GAPSTAR, LLC
By: GENERAL ATLANTIC PARTNERS, LLC,
its Managing Member
By: /s/ Xxxxxx X. Xxxxx
------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: A Managing Member
GAPCO GMBH & CO. KG
By: GAPCO Management GMBH,
its General Partner
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Procuration Officer
35
PVC FUNDING PARTNERS, LLC
By: /s/ Xxxxxxx Xxxx
-------------------------------------------------------
Name: Xxxxxxx Xxxx
Title: Manager
COMVEST VENTURE PARTNERS, L.P.
By: /s/ Xxxxxxx Xxxx
-------------------------------------------------------
Name: Xxxxxxx Xxxx
Title: Manager
XXXX VENTURES, LLC
By: /s/ Xxxxxx X. Xxxx, Xx.
-------------------------------------------------------
Name: Xxxxxx X. Xxxx, Xx.
Title: Manager
XXXXXX XXXXXX
By: /s/ Xxxxxx Xxxxxx
-------------------------------------------------------
Name: Xxxxxx Xxxxxx
GENERAL ATLANTIC PARTNERS 74, L.P.
(solely for the purpose of Section 8.5 and Section 10.5)
By: GENERAL ATLANTIC PARTNERS, LLC,
its General Partner
By: /s/ Xxxxxx X. Xxxxx
------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: A Managing Member
36
