___________________________________________
ASSET PURCHASE AGREEMENT
BY AND AMONG
CPII ACQUISITION CORP.
AND
AMEDISYS, INC.
NOVEMBER 3, 1998
___________________________________________
TABLE OF CONTENTS
PAGE
ARTICLE I. DEFINITIONS........................................................ 2
1.1. Defined Terms....................................................... 2
ARTICLE II. PURCHASE AND SALE OF ASSETS....................................... 6
2.1. Transfer of Assets.................................................. 6
2.2. Assumption of Liabilities........................................... 7
2.3. Purchase Price...................................................... 8
2.4. Allocation of Purchase Price........................................ 8
2.5. Prorations and Adjustments.......................................... 9
2.6. Closing Costs; Transfer Taxes and Fees.............................. 9
ARTICLE III. CLOSING.......................................................... 9
3.1. Closing.............................................................10
3.2. Conveyances at Closing..............................................10
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF SELLER..........................11
4.1. Organization of Seller..............................................11
4.2. Authorization.......................................................11
4.3. Absence of Certain Changes or Events................................12
4.4. Assets..............................................................13
4.5. Real Property.......................................................13
4.6. Contracts and Commitments...........................................13
4.7. Permits.............................................................15
4.8. No Conflict or Violation............................................15
4.9. Consents and Approvals..............................................16
4.10. Financial Statements...............................................16
4.11. Books and Records..................................................17
4.12. Litigation.........................................................17
4.13. Compliance with Law................................................17
4.14. Fixtures and Equipment and Other Tangible Property.................20
4.15. No Brokers.........................................................20
4.16. No Other Agreements to Sell the Assets.............................20
4.17. Proprietary Rights.................................................20
4.18. Customers..........................................................21
4.19. Environmental Matters..............................................21
4.20. Affiliate Transaction..............................................22
4.21. Taxes..............................................................22
4.22. Loss Contracts.....................................................22
4.23. Year 2000..........................................................22
4.24. Windows Operating System Compatibility.............................23
4.25. Full Disclosure....................................................23
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER............................24
5.1. Organization of Buyer...............................................24
5.2. Authorization.......................................................24
5.3. No Conflict or Violation............................................24
5.4. Consents and Approvals..............................................25
5.5. Broker and Finders..................................................25
5.6. Litigation and Proceedings..........................................25
5.7. Full Disclosure.....................................................25
ARTICLE VI. COVENANTS OF SELLER AND BUYER.....................................25
6.1. Further Assurances..................................................26
6.2. [Intentionally Omitted.]............................................26
6.3. [Intentionally Omitted.]............................................26
6.4. [Intentionally Omitted.]............................................26
6.5. [Intentionally Omitted.]............................................26
6.6. Employee Matters....................................................26
6.7. Transitional Services...............................................26
ARTICLE VII. CONDITIONS TO SELLER'S OBLIGATIONS...............................27
7.1. Representations, Warranties and Covenants...........................27
7.2. No Proceedings, Litigation or Laws..................................28
7.3. Certificates........................................................28
7.4. Corporate Documents.................................................28
7.5. Consents............................................................28
ARTICLE VIII. CONDITIONS TO BUYER'S OBLIGATIONS...............................28
8.1. Representations, Warranties and Covenants...........................28
8.2. Consents............................................................29
8.3. No Proceedings or Litigation........................................29
8.4. Opinion of Counsel..................................................29
8.5. Certificates........................................................29
8.6. Corporate Documents.................................................29
8.7. Ancillary Agreements................................................29
8.8. [Intentionally Omitted.]............................................28
8.9. [Intentionally Omitted.]............................................29
8.10. Key Employees......................................................29
8.11. [Intentionally Omitted.]...........................................30
8.12. Release of Encumbrances............................................30
ARTICLE IX. RISK OF LOSS......................................................30
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9.1. Risk of Loss........................................................30
ARTICLE X. ACTIONS BY BUYER AND SELLER AFTER THE CLOSING......................31
10.1. Further Actions....................................................31
10.2. Survival of Representations, Etc...................................31
10.3. Books and Records..................................................32
10.4. Indemnification....................................................32
10.5. Covenant Not To Compete............................................35
10.6. Confidentiality....................................................36
ARTICLE XI. MISCELLANEOUS.....................................................36
11.1. Termination........................................................36
11.2. Assignment.........................................................37
11.3. Notices............................................................38
11.4. Choice of Law......................................................39
11.5. Entire Agreement; Amendments and Waivers...........................39
11.6. Multiple Counterparts..............................................39
11.7. Expenses...........................................................39
11.8. Invalidity.........................................................39
11.9. Titles.............................................................40
11.10. Publicity.........................................................40
11.11. Limitation of Liability...........................................40
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ASSET PURCHASE AGREEMENT
------------------------
This ASSET PURCHASE AGREEMENT (the "Agreement"), dated as of
November __, 1998, is entered into by and between CPII ACQUISITION CORP., a
Delaware corporation ("Buyer"), and AMEDISYS, INC., a Delaware corporation
("Seller").
RECITALS:
---------
A. Seller is a leading provider of out-patient health care services
offering a portfolio of services, including home health care, alternate site
infusion therapy, out-patient surgery, management and information technology,
management services for physicians and temporary medical staffing.
B. Buyer desires to purchase from Seller, and Seller desires to sell and
transfer to Buyer, all of the assets of Seller and its Subsidiaries (as defined
herein) used or held for use in providing home health care management services,
information systems and support (including Analytical Medical Systems (as
defined below)) and consulting services related to the foregoing (together, the
"Business"), all as more specifically set forth in this Agreement, upon the
terms and subject to the conditions of this Agreement.
AGREEMENT:
----------
NOW THEREFORE, in consideration of the premises and mutual covenants
and promises contained herein and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
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ARTICLE I.
DEFINITIONS
-----------
1.1 Defined Terms.
As used herein, the terms below shall have the following meanings:
"Affiliate" means, with respect to any entity, any other entity or
Person which directly or indirectly controls, is controlled by, or is under
common control with such entity, where the term "control" means the ownership,
directly or indirectly, of more than fifty percent (50%) of the equity capital
or the right or power in fact to direct the management of such entity.
"Analytical Medical Systems" shall mean those certain home health
information systems created, modified, enhanced or developed by Seller and its
Subsidiaries, including the existing character-based products, as well as the
"windows" products, known commonly as Analytical Medical Systems "AMS", the
functions of which are described on Schedule 4.24.
"Ancillary Agreements" shall mean any agreements or instruments (other
than this Agreement) entered into in connection with the transactions
contemplated hereby.
"Books and Records" shall mean (a) all records and lists of Seller and
its Subsidiaries pertaining to the Assets, (b) all records and lists of Seller
and its Subsidiaries pertaining to the Business or the customers or suppliers of
the Business, (c) all product, business and marketing plans of Seller and its
Subsidiaries pertaining to the Business and (d) all books, ledgers, files,
reports, plans, drawings and operating records of every kind maintained by
Seller and its Subsidiaries pertaining to the Business.
"Business" shall have the meaning set forth in the Recitals hereto.
"Buyer" shall have the meaning set forth in the preamble.
"Closing Date" shall mean the date hereof.
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"Contracts" shall mean all contracts, leases, licenses, commitments,
understandings and agreements relating to, or used in, the Business to which
Seller or any of its Subsidiaries are a party or are bound, whether oral or
written.
"Disclosure Schedule" shall mean the schedule attached hereto which
sets forth certain exceptions to the representations and warranties contained in
Article IV hereof and certain other information called for by this Agreement.
Unless otherwise specified, each reference in this Agreement to any numbered
schedule is a reference to that numbered schedule which is included in the
Disclosure Schedule.
"Encumbrance" shall mean any claim, lien, pledge, option, charge,
easement, security interest, deed of trust, mortgage, right-of-way,
encroachment, building or use restriction, conditional sales agreement,
encumbrance or other right of third parties, whether voluntarily incurred or
arising by operation of law, and includes, without limitation, any agreement to
give any of the foregoing in the future, and any contingent sale or other title
retention agreement or lease in the nature thereof.
"Environmental Laws" shall mean all federal, state, local or foreign
laws, statutes, ordinances, regulations, rules, judgments or orders which (i)
regulate or relate to the protection or clean-up of the environment, the
handling or disposition of hazardous substances, the preservation or protection
of waterways, groundwater, drinking water, air, wildlife, plants or other
natural resources, or the health and safety of Persons or property, including,
without limitation, protection of the health and safety of employees or (ii)
impose liability with respect to any of the foregoing, including, without
limitation, the Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.),
Resource Conservation & Recovery Act (42 U.S.C. (S) 6901 et seq.) ("RCRA"), Safe
Drinking Water Act (21 U.S.C.(S) 349, 42 U.S.C.(S)(S) 201, 300f), Toxic
Substances
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Control Act (15 U.S.C.(S) 2601 et seq.), Clean Air Act (42 U.S.C.(S)
7401 et seq.), Comprehensive Environmental Response, Compensation and Liability
Act (42 U.S.C.(S) 9601 et seq.) ("CERCLA"), California Health & Safety Code ((S)
25100 et seq., (S) 39000 et seq.) and California Water Code ((S) 13000 et seq.),
or any other similar federal, state or local law of similar effect, each as
amended.
"Excluded Assets" shall mean the following assets of Seller or any
Subsidiary or Seller:
(a) all cash and cash equivalents;
(b) any interest in real property;
(c) any direct or indirect interest of Seller in any Subsidiary
or other Person;
(d) all policies of insurance and prepaid insurance premiums;
and
(e) claims, causes of action, chooses in action, accounts
receivable, rights of recovery and rights of set-off of any kind against any
Person relating to the Assets or the Assumed Liabilities arising prior to the
Closing Date.
"Excluded Liabilities" shall mean any and all liabilities and
obligations of Seller and its Subsidiaries and Affiliates (whether or not
related to the Business) other than the Assumed Liabilities.
"Fixtures and Equipment" shall mean all of the furniture, fixtures,
furnishings, machinery, spare parts, supplies, equipment and other tangible
personal property owned by Seller and its Subsidiaries and used or held for use
in the Business.
"Inventory" shall mean all of Seller's and its Subsidiaries' inventory
held for resale in connection with the Business.
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"Material Adverse Change" shall mean any significant and substantial
adverse change in (i) the Assets, (ii) the Assumed Liabilities, (iii) the
results of operations, condition (financial or otherwise) or prospects of the
Business, (iv) the results of operations, condition (financial or otherwise) or
prospects of Seller and its Subsidiaries, taken as a whole, or (v) the ability
of Seller to consummate the transactions contemplated hereby. A "Material
Adverse Change" shall also include any event or condition which would, with the
passage of time, constitute such a "material adverse change."
"Material Adverse Effect" shall mean any significant and substantial
adverse effect on (i) the Assets, (ii) the Assumed Liabilities, (iii) the
results of operations, condition (financial or otherwise) or prospects of the
Business, (iv) the results of operations, condition (financial or otherwise) or
prospects of Seller and its Subsidiaries, taken as a whole, or (v) the ability
of Seller to consummate the transactions contemplated hereby. A "Material
Adverse Effect" shall also include any event or condition which would, with the
passage of time, constitute such a "material adverse effect."
"Permits" shall mean all licenses, permits, approvals, authorizations
or consents of any governmental authority, whether foreign, federal, state or
local, necessary for, or in effect with respect to, the conduct of the Business
as currently conducted.
"Permitted Encumbrances" shall mean (i) materialmen's, mechanics,
carriers', workmen's repairmen's or other like liens arising in the ordinary
course of Seller's business for amounts not yet due or which are being contested
in good faith by appropriate proceedings and (ii) liens for current taxes not
yet due or any taxes being contested in good faith by appropriate proceedings.
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"Person" shall mean any individual, partnership, corporation, trust,
association, limited liability company, unincorporated organization, government
or any department or agency thereof or any other entity.
"Personal Property Leases" shall mean all of the existing leases with
respect to the personal property of Seller and its Subsidiaries used or held for
use in the Business.
"Proprietary Rights" shall mean all right, title and interest of
Seller and its Subsidiaries in and to (i) all patents, trademarks, copyrights,
trade names, trade rights, trade dress, mask works, trade secrets, designs,
plans, specifications, technical information and processes, formulae, computer
programs and software, and other proprietary or intellectual property rights,
(ii) any registrations of the foregoing (domestic or foreign) and pending
applications for such registration, (iii) rights under any licenses to use any
of the foregoing and (iv) all good will associated with or attributable to the
foregoing, in each case, used or held for use in the operation of the Business,
as currently conducted.
"Seller" shall have the meaning set forth in the preamble.
"Subsidiary" shall mean, with respect to any Person, a corporation or
other entity of which 50% or more of the voting power of the equity securities
or equity interests is owned, directly or indirectly, by such Person.
ARTICLE II.
PURCHASE AND SALE OF ASSETS
2.1. Transfer of Assets. Upon the terms and subject to the conditions
contained herein, at the Closing, Seller and each of its Subsidiaries will sell,
convey, transfer, assign and deliver to Buyer, and Buyer will purchase from
Seller and such Subsidiaries, free and clear of all Encumbrances, all of the
right, title and interest of Seller and such Subsidiaries in and
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to all properties, assets and rights of any kind, whether tangible or
intangible, real or personal, used or held for use in the conduct of the
Business, except for the Excluded Assets (collectively, the "Assets"),
including, without limitation, all of Seller's and such Subsidiaries' right,
title and interest in the following:
(a) deposits, prepayments or prepaid expenses relating to the
Business;
(b) Contracts;
(c) Fixtures and Equipment;
(d) Books and Records;
(e) Proprietary Rights, including, without limitation, all
rights in the home health information system developed and used by Seller and
its Subsidiaries (including the source code and exclusive use thereof) commonly
known as Analytical Medical Systems or AMS, along with all trademark
applications, service marks, service xxxx applications, registered trademarks
and all renewals thereof;
(f) Permits; and
(g) rights under or pursuant to all warranties, representations
and guarantees made by vendors or suppliers in connection with the Assets or the
Business, and services furnished to Seller or its Subsidiaries.
2.2. Assumption of Liabilities. On the Closing Date, Buyer shall
assume the liabilities of Seller and its Subsidiaries which accrue under the
Contracts listed on Schedule 2.2 (the "Assumed Contracts") after the Closing
(the "Assumed Liabilities"). Buyer shall not assume any other liabilities or
obligations of Seller, including, without limitation, (i) any obligations or
liabilities under any contract, agreement or lease not included in the Assumed
Contracts, (ii) any obligations or liabilities under the Assumed Contracts
relating to the period prior to the Closing,
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(iii) any obligations or liabilities relating to or arising out of any claims or
pending litigation proceedings, (iv) any obligations or liabilities of Seller
under any employee pension, retirement or other benefit plans and (v) any
obligations or liabilities to any employee of the Business, including, without
limitation, any obligation for severance benefits, vacation time or sick leave,
and all such obligations and liabilities shall remain and be the obligations and
liabilities of Seller.
2.3. Purchase Price. At the Closing, upon the terms and subject to
the conditions set forth herein, as consideration for the Assets, Buyer shall
pay to Seller Eleven Million Dollars ($11,000,000) in cash (the "Purchase
Price") by wire transfer of immediately available funds to an account designated
by Seller. Buyer and Seller hereby agree that Five Hundred Thousand Dollars
($500,000) of the Purchase Price is attributable to the Covenant Not to Compete
contained in Section 10.5.
2.4. Allocation of Purchase Price. Buyer and Seller shall negotiate
in good faith to agree within 90 days of the Closing Date on an allocation of
the Purchase Price in accordance with the requirements of Section 1060 of the
Code. Buyer and Seller shall each file with their respective federal income tax
returns for the tax year in which the Closing occurs, IRS Form 8594 containing
the information agreed upon by the parties pursuant to the immediately preceding
sentence. Buyer and Seller shall each deliver to the other a copy of the IRS
Form 8594 as filed with their respective federal income tax returns within 30
days of the filing of such return. Buyer agrees to report the purchase of the
Assets, and Seller agrees to report the sale of the Assets, for income tax
purposes (including but not limited to, on their respective income tax returns,
before any governmental agency charged with the collection of income tax or in
any judicial proceeding concerning the income tax consequences of the
Purchaser's purchase or the Seller's sale of the Assets hereunder) in a manner
consistent with the information agreed upon by
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the parties pursuant to this Section and the information contained in IRS Form
8594.
2.5. Prorations and Adjustments. The operation of the Business and
the income and normal operating expenses, including, without limitation, Assumed
Liabilities and prepaid expenses, attributable thereto through 12:01 a.m. on the
Closing Date (the "Adjustment Time") shall be for the account of Seller and
thereafter for the account of Buyer. Expenses for goods or services received
both before and after the Adjustment Time and deferred items shall be prorated
between Seller and Buyer as of the Adjustment Time. Buyer will prepare and
deliver within sixty (60) days after the Closing Date a report computing the net
payment owing by Buyer or Seller, as the case may be, and the details of such
determination in accordance with the provisions of this Section 2.5. Within
twenty (20) days after receiving the report, Seller will provide Buyer with any
objections to the report and the party obligated to make payment under the
report will do so within five (5) days after the expiration of the twenty (20)
day period. If any disagreement with respect thereto cannot be resolved by the
parties, Seller and Buyer will select a certified public accountant to resolve
the dispute. The resolution of such accountant shall be binding on the parties
and subject to judicial enforcement. One-half of the cost of the accountant
shall be paid by each party.
2.6. Closing Costs; Transfer Taxes and Fees. The cost of any transfer
or conveyance taxes and the recording or filing of all applicable conveyancing
instruments incurred by reason of the transfer of Assets hereunder (including
documentary and transfer taxes in connection therewith) will be paid by Seller.
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ARTICLE III.
CLOSING
3.1. Closing. The Closing of the transactions contemplated hereby
(the "Closing") shall be held at 10:00 a.m. local time on the Closing Date at
such location as the parties hereto agree.
3.2. Conveyances at Closing.
(a) Instruments and Possession. To effect the sale and
assumption referred to in Article II, Seller will, at the Closing, execute and
deliver to Buyer:
(i) one or more bills of sale conveying in the aggregate
all of Seller's and its Subsidiaries' owned personal property included in the
Assets;
(ii) an instrument of assignment providing for the
assignment by Seller to Buyer of the Contracts;
(iii) assignments of the Proprietary Rights in recordable
form to the extent necessary to assign such rights; and
(iv) such other instruments as shall be reasonably
requested by Buyer to vest in Buyer such right, title or interest in and to the
Assets in accordance with the provisions hereof.
(b) Assumption and Other Documents. To effect the sale and
assumption referred to in Article II, at the Closing, Buyer shall execute and
deliver to Seller:
(i) an instrument of assumption evidencing Buyer's
assumption pursuant to Section 2.2 of the Assumed Liabilities; and
(ii) such other instruments as shall be reasonably
requested by Seller to evidence Buyer's assumption of the Assumed Liabilities in
accordance with the provisions hereof.
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(c) Form of Instruments. To the extent that a form of any
document to be delivered hereunder is not attached as an Exhibit hereto, such
documents shall be in form and substance, and shall be executed and delivered in
a manner, reasonably satisfactory to the party or parties in whose favor the
document runs.
(d) Certificates; Opinions. Buyer and Seller shall deliver the
certificates, opinions of counsel and other documents described in Articles VII
and VIII.
(e) Consents. Seller shall obtain and deliver evidence of all
governmental and other third party consents and waivers required pursuant to
Section 8.2.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Buyer as follows:
4.1. Organization of Seller. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Seller is duly qualified to do business as a foreign corporation and is in good
standing in each jurisdiction where the character of its properties owned or
leased or the nature of its activities make such qualification necessary. Copies
of the corporate charter and bylaws of Seller, and all amendments thereto,
heretofore delivered to Buyer are accurate and complete as of the date hereof.
Schedule 4.1 contains a true, correct and complete list of all jurisdictions in
which Seller is qualified to do business as a foreign corporation.
4.2. Authorization. Seller has all requisite corporate power and
authority to own, lease and operate the Assets, to conduct its business as it is
presently being conducted, to execute and deliver this Agreement and the
Ancillary Agreements, and to perform its obligations hereunder and thereunder.
The execution and delivery of this Agreement and the Ancillary
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Agreements by Seller and the consummation by Seller of the transactions
contemplated hereby and thereby have been duly approved by the board of
directors of Seller. No other corporate proceedings on the part of Seller are
necessary to authorize this Agreement and the Ancillary Agreements and the
transactions contemplated hereby and thereby. This Agreement has been duly
executed and delivered by Seller and is a legal, valid and binding obligation of
Seller, and the Ancillary Agreements when executed at Closing will constitute a
valid and binding obligation of Seller, enforceable against Seller in accordance
with their respective terms, subject to bankruptcy, insolvency, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
4.3. Absence of Certain Changes or Events. Since June 30, 1998, there
has not been any:
(a) Material Adverse Change;
(b) change in accounting methods, principles or practices by
Seller or any of its Subsidiaries, except as required by law or by generally
applicable changes instituted in the accounting profession;
(c) material damage, destruction or loss (whether or not covered
by insurance) adversely affecting the Assets or the Business;
(d) adverse change in employee relations which has had or would
have a Material Adverse Effect;
(e) except as set forth on Schedule 4.3(e), cancellation or
termination of any Contract or entry into any Contract;
(f) sale, assignment or transfer of any material portion of the
Assets, other than in the ordinary course of business;
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(g) any failure to operate the Business in the ordinary course;
(h) except as set forth on Schedule 4.3(h), actual or threatened
termination of any Contract;
(i) material adverse change in the business of Seller and its
Subsidiaries, taken as a whole;
(j) agreement by Seller or its Subsidiaries to do any of the
things described in the preceding clauses (a) through (i) other than as
expressly provided for herein.
4.4. Assets. Seller and its Subsidiaries have good and marketable
title to the Assets, free and clear of all Encumbrances, other than Permitted
Encumbrances, and, upon the consummation of the transactions contemplated
hereby, Buyer will acquire good title to all such Assets, free and clear of any
Encumbrances, other than Permitted Encumbrances. The Assets include all material
assets used in, or necessary for, the conduct of the business of Seller and its
Subsidiaries as currently conducted.
4.5. Real Property. Schedule 4.5 contains a complete and accurate
list of all real property used in the conduct of the Business, as currently
conducted.
4.6. Contracts and Commitments.
(a) Contracts. Schedule 4.6 sets forth a complete and accurate
list of all Contracts of the following categories:
(i) Contracts not made in the ordinary course of the
Business;
(ii) Contracts providing for the provision of services by
the Business to its customers;
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(iii) Contracts (including licenses and sublicenses)
relating to Proprietary Rights and other intellectual property rights;
(iv) Material distribution, franchise, license, sales,
commission, consulting agency or advertising Contracts which are not cancelable
on thirty (30) calendar days notice;
(v) Contracts involving expenditures or liabilities in
excess of $5,000 or otherwise material to the Business;
(vi) Contracts containing covenants limiting the freedom
of Seller or its Subsidiaries to engage in any line of business or compete with
any Person; and
(vii) Personal Property Leases.
Seller has delivered or made available to Buyer true, correct and
complete copies of all of the Contracts listed on Schedule 4.6, including all
amendments and supplements thereto. Except as set forth on Schedule 4.6, the
assignment of the Contracts to Buyer will not require the consent or approval of
any party to any of the Contracts.
(b) Absence of Breaches or Defaults. All of the Contracts are
valid and in full force and effect. Seller and each of its Subsidiaries has duly
performed all of its material obligations under such Contracts to the extent
those obligations to perform have accrued, and no material violation of, or
material default or breach under, such Contracts by Seller or its Subsidiaries,
or, to Seller's knowledge, any other party has occurred and neither Seller nor
its Subsidiaries, nor, to Seller's knowledge, any other party has repudiated any
material provisions thereof. Neither Seller nor any of its Subsidiaries is in
material breach or default under any contract, agreement, indenture or other
instrument relating to the borrowing of money
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by Seller or any of its Subsidiaries, and Seller does not have any reason to
believe that any such breach or default could reasonably be expected to occur in
the foreseeable future.
(c) Warranty. Seller and its Subsidiaries have committed no act,
and there has been no omission, which would result in, and there has been no
occurrence which would give rise to, any material liability for breach of
warranty on the part of Seller or its Subsidiaries.
4.7. Permits. Seller and its Subsidiaries have all Permits required
to conduct their business in all material respects as now being conducted. All
such Permits of Seller or its Subsidiaries are valid and in full force and
effect. Schedule 4.7 contains a true and accurate list of all such Permits.
4.8. No Conflict or Violation. Neither the execution, delivery or
performance of this Agreement and the Ancillary Agreements by Seller nor the
consummation by Seller of the transactions contemplated hereby and thereby will
(a) violate or conflict with any provision of the corporate charter or bylaws or
similar organizational documents of Seller or any of Seller's Subsidiaries, (b)
violate, conflict with, or result in a breach of any provision of, or constitute
a default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or accelerate the
performance required by, or result in a right of termination or acceleration
under, or result in the creation of any material Encumbrance upon any of the
Assets under any of the terms, conditions or provisions of any Contract,
indebtedness, note, bond, indenture, security or pledge agreement, commitment,
license, Lease, franchise, Permit, agreement, or other instrument or obligation
(i) to which Seller or any of its Subsidiaries is a party or (ii) by which the
Assets are bound, (c) violate any statute, rule, regulation, ordinance,
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code, order, judgment, ruling, writ, injunction, decree or award to which Seller
or any of its Subsidiaries or the Assets is subject, or (d) impose any
Encumbrance on the Assets.
4.9. Consents and Approvals. Except as listed on Schedule 4.9, no
material consent, approval or authorization of, or declaration, filing or
registration with, any governmental or regulatory authority, or any other
Person, is required to be made or obtained by Seller in connection with Seller's
execution, delivery and performance of this Agreement or the Ancillary
Agreements.
4.10. Financial Statements. Seller has previously delivered to Buyer
the following financial statements, all of which have been prepared in
accordance with GAAP and present fairly the consolidated financial position of
Seller and its consolidated Subsidiaries at the dates stated in such financial
statements and the results of their operations for the periods stated therein
(subject, in the case of the financial statements referenced in paragraph (ii),
to the absence of footnotes and to normal year-end adjustments, the effect of
which will not, individually or in the aggregate, be materially adverse to the
business, operations or financial condition of Seller or any of its
Subsidiaries):
(i) the audited consolidated balance sheets of Seller and
its consolidated Subsidiaries as of December 31, 1997, 1996 and 1995, and the
related audited consolidated statements of operations, stockholders' equity and
cash flows of Seller and its consolidated Subsidiaries for the years ended
December 31, 1997, 1996 and 1995, together with the auditors' report thereon;
and
(ii) the unaudited consolidated balance sheet of Seller
and its consolidated Subsidiaries as of June 30, 1998, and the related unaudited
consolidated statements
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of operations, stockholders' equity and cash flows of Seller and its
consolidated Subsidiaries for the six-month period ended June 30, 1998.
4.11. Books and Records. Seller and its Subsidiaries have made and
kept (and given Buyer access to) the Books and Records, which, in all material
respects, accurately and fairly reflect the activities of Seller and its
Subsidiaries with respect to the Assets and the Business that would be so
recorded.
4.12. Litigation. Except as set forth on Schedule 4.12, there is no
action, order, writ, injunction, judgment or decree outstanding or any claim,
suit, litigation, proceeding, labor dispute, arbitral action, governmental audit
or investigation (collectively, "Actions") pending, or to Seller's knowledge,
threatened against, related to or affecting Seller or any of its Subsidiaries
(i) that relates to or affects the Assets or the Business, (ii) that could have
a Material Adverse Effect, or (iii) seeking to delay, limit or enjoin the
transactions contemplated by this Agreement or the Ancillary Agreements. Neither
Seller nor its Subsidiaries is in default with respect to or subject to any
judgment, order, writ, injunction or decree of any court or governmental agency,
and, to the knowledge of Seller, there are no unsatisfied judgments against
Seller or any of its Subsidiaries or the Assets.
4.13. Compliance with Law. Seller and its Subsidiaries are, and at all
times during the past five (5) years have been, in compliance in all material
respects with all applicable statutes and governmental rules, regulations,
Permits and policies in respect of the Assets and the Business. Except as
described on Schedule 4.13, during the past five (5) years, neither Seller nor
any of its Subsidiaries has conducted any internal investigation relating to any
actual or alleged violation of any statute, law or governmental rule or
regulation by Seller or any of its Subsidiaries relating in any way to the
Business. Without limiting the foregoing, except with
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respect to matters set forth on Schedule 4.13, Seller and its Subsidiaries are,
and at all times during the last five (5) years have been, in compliance in all
material respects with all applicable laws (including rules and regulations
thereunder) of federal, state, local and foreign governments relating to health
care, the health care industry, the provision of health care products or
services and any applicable third party reimbursement laws (including, without
limitation, Medicare and Medicaid). Neither Seller nor any of its Subsidiaries
since inception has received notice that Seller or any of its Subsidiaries has
been the subject of any investigative proceeding before any federal or state
regulatory authority or the agent of any such authority, including, without
limitation, federal and state health authorities. In addition, Seller and its
Subsidiaries have complied in all material respects with all applicable Medicare
and Medicaid program requirements. All Medicare and Medicaid bills or claims for
payment in connection with the business of Seller and its Subsidiaries
(collectively, "Bills") submitted by or on behalf of Seller or its Subsidiaries
for items, services and goods provided to beneficiaries of the programs
represent bona fide claims receipts (i.e., Seller or its Subsidiaries believed
in good faith that such services were medically necessary and met all coverage
and documentation requirements) for items, services or goods provided to
Medicare or Medicaid beneficiaries and in accordance with applicable laws, rules
and regulations, and were submitted by or on behalf of Seller or one of its
Subsidiaries materially in accordance with applicable laws, rules and
regulations. There are no threatened audits, investigations or claims for or
relating to any material liability with respect to Medicare and Medicaid. Seller
and its Subsidiaries are eligible to receive payments with respect to operations
of their respective business under Title XVIII and Title XIX of the Social
Security Act. Seller and its Subsidiaries have timely filed all claims and
reports required to be filed with respect to the operations of their respective
businesses in connection with all state Medicaid and
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federal Medicare programs, which claims and reports are complete and correct in
all material respects. There are no actions, appeals or investigations pending
or threatened before any entity, commission, board or agency, including an
intermediary or carrier or the administrator of the Health Care Financing
Administration, with respect to any Medicare or Medicaid claims, or CHAMPUS (as
defined below) or other claims, or reports filed by Seller or its Subsidiaries
with respect to the operations of their respective businesses on or before the
date hereof or program compliance matters, which would reasonably be expected to
have a Material Adverse Effect. Neither Seller nor any Subsidiary, nor the
officers, directors or employees or agents of any of Seller or any Subsidiary
have engaged in any activities which are prohibited under criminal law, or are
cause for civil penalties or mandatory or permissive exclusion from Medicare or
Medicaid or any other state or federal health care program under Sections 1320a-
7, 1320a-71, 1320a-7b, or 1395nn of Title 42 of the United States Code, the
federal Civilian Health and Medical Plan of the Uniformed Services ("CHAMPUS")
Statute, or the regulations promulgated pursuant to such statutes or regulations
or related state or local statutes or which are prohibited by any private
accrediting organization from which the Seller or any of its Subsidiaries seeks
accreditation or by generally recognized professional standards of care or
conduct. Neither Seller nor any of its Subsidiaries, nor any of their respective
officers, directors or employees or agent of Seller or any of its Subsidiaries,
(i) has had a civil monetary penalty assessed against it under Section 1128A of
the Social Security Act or any regulations promulgated thereunder, (ii) has been
excluded from participation under Medicare, Medicaid or a state health care
program or a federal health care program, or (iii) has been convicted of any of
the offenses set forth in Social Security Act Section 1128(a) and (b)(1), (2),
(3) or any regulations promulgated thereunder. For the purpose hereof, "Medicaid
and Medicare" mean, respectively, the State Care Programs for the indigent
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under Title XIX of the Social Security Act and the Federal Health Care program
for those over age 65 years and the disabled and Title XVIII of the Social
Security Act.
4.14. Fixtures and Equipment and Other Tangible Property. Except as
set forth on Schedule 4.14, the Fixtures and Equipment and other tangible
personal property used in the conduct of the Business are in good operating
condition and repair (subject to normal wear and tear) and are suitable for the
purposes for which each is presently and has historically been used.
4.15. No Brokers. Except as set forth on Schedule 4.15, no broker,
finder or similar agent is entitled to any finder's fee, brokerage fees or
commission or similar payment from Seller in connection with the transactions
contemplated hereby.
4.16. No Other Agreements to Sell the Assets. Neither Seller nor any
of its officers, directors, shareholders or Affiliates have any commitment or
legal obligation, absolute or contingent, to any other Person other than Buyer
to sell, assign, transfer or effect a sale of any material portion of the Assets
or the Business or to effect any other business combination relating to the
Assets or the Business or to enter into any agreement or cause the entering into
of an agreement with respect to any of the foregoing business combination
transactions.
4.17. Proprietary Rights.
(a) Proprietary Rights. Schedule 4.17 lists all Proprietary
Rights material to the conduct of the Business as currently conducted.
(b) Ownership and Protection of Proprietary Rights. Seller or
one of its Subsidiaries owns each of the Proprietary Rights listed on Schedule
4.17. The Proprietary Rights listed on Schedule 4.17 constitute all of the
material Proprietary Rights necessary to conduct the Business in the manner
currently conducted. None of the Proprietary Rights is involved in any pending
or, to the knowledge of Seller, threatened litigation. No other Person
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(i) has the right to use any of the Proprietary Rights or (ii) is infringing
upon any Proprietary Rights. Seller's use of the Proprietary Rights is not
infringing upon or otherwise violating the rights of any third party. No
proceedings have been instituted against or notices received by Seller that are
presently outstanding alleging that Seller's use of the Proprietary Rights
infringes upon or otherwise violates any rights of a third party in or to such
Proprietary Rights, and Seller knows of no basis for any such proceeding. All
Proprietary Rights are freely assignable by Seller to Buyer. Concurrently with
the Closing, Buyer will be vested with all rights, title and interest and
authority to use the Proprietary Rights to the same degree as the Seller and its
Subsidiaries immediately prior thereto. No Proprietary Right is subject to any
outstanding order, judgment, decree, stipulation or agreement restricting the
use or licensing thereof by Seller or its Subsidiaries. No Person (including,
without limitation, any employee, developer, licensee, licensor, lender or
supplier) other than Seller and its Subsidiaries has any interest in, or right
or claim to, any Proprietary Right.
4.18. Customers. Schedule 4.18 sets forth a complete and accurate list
of the names and addresses of all customers of the Business for the most recent
fiscal year, showing the approximate total sales in dollars by the Business to
each such customer during such fiscal year. As of the date hereof, Seller has
not received any communication from any customer named on Schedule 4.18 of any
intention to terminate or materially reduce purchases from the Business.
4.19. Environmental Matters. Except as set forth on Schedule 4.19: (a)
Seller and its Subsidiaries are in substantial compliance with all Environmental
Laws in connection with the conduct of the Business; (b) Seller and its
Subsidiaries have no material liability under any Environmental Law with respect
to the Business; (c) no notices of any material violation or alleged material
violation of, or any material liability under, any Environmental Law relating to
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the Business have been received by Seller or its Subsidiaries during the
preceding three (3) years; and (d) there are no writs, injunctions, decrees,
orders or judgments outstanding, or any actions, suits, claims, proceedings or
investigations pending or, to Seller's knowledge, threatened, relating to
compliance with or liability under any Environmental Law affecting the Assets or
the Business.
4.20. Affiliate Transaction. Schedule 4.20 hereto describes all
material transactions affected during the last 3 years involving the Business,
on the one hand, and the other divisions, subsidiaries and businesses of Seller
or any officer, director, stockholder or Affiliate of Seller or its
Subsidiaries, on the other hand.
4.21. Taxes. Seller and each of its Subsidiaries have filed all
applicable federal, state, local and foreign tax returns required to be filed to
date, in accordance with provisions of law pertaining thereto, and has paid all
taxes, interest, penalties and assessments (including, without limitation,
income, withholding, excise, unemployment, Social Security (OASDI and Medicare),
occupation, transfer, franchise, property, sales and use taxes, and all
penalties and interest in respect thereof) required to have been paid to date by
Seller or such Subsidiary.
4.22. Loss Contracts. Except as set forth on Schedule 4.22, Seller and
its Subsidiaries have not incurred any loss with respect to any Contract listed
in Schedule 4.6, and Seller does not expect, to the best of Seller's knowledge,
the performance of any Contract listed on Schedule 4.6 to result in any loss
being incurred by Seller or any of its Subsidiaries.
4.23. Year 2000. Except as set forth on Schedule 4.23, the Assets
include all systems and software solutions necessary or appropriate to address
and accommodate Year 2000 computer systems issues, and the computer software
included in the Assets has been tested and is fully capable of providing
accurate results using data having date ranges spanning the twentieth
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and twenty-first centuries. Without limiting the generality of the foregoing,
the computer software included in the Assets is able, except as set forth on
Schedule 4.23, to (i) manage and manipulate data involving all dates from the
twentieth and twenty-first centuries without functional or data abnormality
related to such dates; (ii) manage and manipulate data involving all dates from
the twentieth and twenty-first centuries without inaccurate results related to
such dates; (iii) have user interfaces and data fields formatted to distinguish
between dates from the twentieth and twenty-first centuries; and (iv) represent
all data related to include indications of the millennium, century and decade as
well as the actual year.
4.24. Windows Operating System Compatibility. As of the date of this
Agreement, (i) Seller has developed and is implementing a Windows 95 version of
Analytical Medical Systems that operates in the Windows NT environment of the
Microsoft Windows operating system (the "Windows AMS Product"), (ii) the Windows
AMS Product is complete, tested and ready for implementation and has at least
the same level and degree of functionality as the current MS-DOS based version
of AMS, (iii) each of the MS-DOS based version of AMS and the Windows AMS
Product performs in accordance with the specifications listed on Schedule 4.24
and (iv) the MS-DOS based version of AMS and the Windows AMS Product will
perform in accordance with such specifications if applied with respect to
operations consisting of at least (A) 100 separate home health care sites and
(B) two million patient visits.
4.25. Full Disclosure. No representation or warranty made by Seller in
this Agreement, nor any document, exhibit, statement, certificate or schedule
furnished by Seller to Buyer in connection with the transactions contemplated
hereby, contains any untrue statement of material fact or omits to state any
material fact necessary in order to make the statement contained herein or
therein not misleading. Seller has disclosed to Buyer all events, conditions
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and facts material to the Assets and the results of operation, condition
(financial and otherwise) and prospects of the Business.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represent and warrant to Seller as follows:
5.1. Organization of Buyer. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Copies of the Certificates of Incorporation and Bylaws of Buyer, heretofore
delivered by Buyer to Seller, are accurate and complete as of the date hereof.
Buyer is duly licensed and qualified to do business and is in good standing in
each jurisdiction in which such qualification is required or will be required as
a result of the transaction contemplated by this Agreement by applicable law.
5.2. Authorization. Buyer has full corporate power and authority to
execute and deliver this Agreement and the Ancillary Agreements, and to perform
its obligations hereunder and thereunder. The execution, delivery and
performance by Buyer of this Agreement and the Ancillary Agreements have been
duly authorized by all requisite corporate action on the part of Buyer. This
Agreement has been duly executed and delivered by Buyer and is a valid and
binding obligation of Buyer, and the Ancillary Agreements when executed at
Closing will constitute a valid and binding obligation of Buyer, enforceable
against Buyer in accordance with their respective terms, subject to bankruptcy,
insolvency, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
5.3. No Conflict or Violation. Neither the execution and delivery of
this Agreement or the Ancillary Agreements by Buyer nor its performance of its
obligations
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hereunder and thereunder will result in (a) a violation of or a conflict with
any provision of the Certificate of Incorporation or Bylaws of Buyer, (b)
violate or conflict with or result in a breach of or constitute a default under
any term or provision of any contract, agreement, commitment, lease, license,
franchise or permit or other instrument or obligation to which Buyer is a party
or is bound, or (c) a violation by Buyer of any statute, rule, regulation,
ordinance, code, order, judgment, writ, ruling, injunction, decree, or award, to
which Buyer is subject.
5.4. Consents and Approvals. No consent, approval or authorization or
declaration, filing or registration with any governmental or regulatory
authority, or any other Person, is required to be made or obtained by Buyer in
connection with Buyer's execution, delivery and performance of this Agreement or
the Ancillary Agreements.
5.5. Broker and Finders. Neither Buyer nor any of its Affiliates has
entered into any agreement or incurred any obligation, directly or indirectly,
for the payment of any brokerage fees, commissions or finder's fee, for which
the Seller will be liable, in connection with the transactions contemplated by
this Agreement.
5.6. Litigation and Proceedings. There are no Actions pending or, to
the best of knowledge of Buyer, threatened against Buyer.
5.7. Full Disclosure. No representation or warranty made by Buyer in
this Agreement, nor any document, exhibit, statement, certificate or schedule
furnished by Buyer to Seller in connection with the transactions contemplated
hereby, contains any untrue statement of material fact or omits to state any
material fact necessary in order to make the statement contained herein or
therein not misleading.
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ARTICLE VI.
COVENANTS OF SELLER AND BUYER
Seller and Buyer each covenant as follows:
6.1. Further Assurances. Each of the parties hereto agrees, both
before and after the Closing, (i) subject to the satisfaction of the conditions
set forth in Article VII and Article VIII, to use all reasonable efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective the
transactions contemplated by this Agreement and (ii) to execute any documents,
instruments or conveyances of any kind which may be reasonably necessary or
advisable to carry out any of the transactions contemplated hereby.
6.2. [INTENTIONALLY OMITTED.]
6.3. [INTENTIONALLY OMITTED.]
6.4. [INTENTIONALLY OMITTED.]
6.5. [INTENTIONALLY OMITTED.]
6.6. Employee Matters. The parties acknowledge that Buyer shall have
no obligation to hire any employee of Seller or its Subsidiaries at or following
the Closing and that Buyer is assuming no liabilities or obligation with respect
to such employees of Seller of such Subsidiaries. In the event that, prior to 90
days after the Closing Date, Buyer notifies Seller in writing that it desires to
hire any current employee or employees of Seller employed in the Business at or
following the Closing, Seller shall use its reasonable best efforts to cause any
employee so identified by Buyer except for Xxxxx Xxxxxxx, Xxxx Xxxxxxxx, and
Xxxxxxxxxx Xxxxx (the "Key Employees") to accept an offer of employment made by
Buyer to such Key Employee that is substantially consistent with the current
terms of employment between such Key Employee and Seller.
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6.7. Transitional Services.
(a) Between the Closing Date and the date which is ninety (90)
days after the Closing Date, Seller shall provide, or cause its Affiliates to
provide, to Buyer or its Affiliates, at Seller's sole cost and expense (except
for out-of-pocket expenses, which shall be reimbursed by Buyer), services
requested by Buyer to the extent that (i) such services are of the type
currently provided by Seller to the Business and (ii) such services are
reasonably necessary to conduct the Business as currently conducted. Such
services shall be provided in the manner and at a relative level of service
consistent in all material respects with that provided by Seller to the Business
prior to the date hereof.
(b) Between the date hereof and the first anniversary hereof,
Seller will make available to Buyer, at no cost to Buyer, the services of senior
programming and/or software development professionals employed by Seller for the
purpose of providing the Business with software development support. The
specific senior programming and/or software development employees to perform
such services will be selected by Buyer with the consent of Seller (not to be
unreasonably withheld). Such services will be provided as requested in writing
by Buyer and shall include up to 2,000 man-hours of service.
ARTICLE VII.
CONDITIONS TO SELLER'S OBLIGATIONS
The obligations of Seller to effect the Closing are subject, in the
discretion of Seller, to the satisfaction, on the Closing Date, of each of the
following conditions, any of which may be waived by Seller:
7.1. Representations, Warranties and Covenants. All representations
and warranties of Buyer contained in this Agreement shall be true and correct in
all material respects at and as of the date of this Agreement and at and as of
the Closing, and Buyer shall have
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performed and satisfied all material agreements and covenants required hereby to
be performed by it prior to the Closing.
7.2. No Proceedings, Litigation or Laws. No Action by any
governmental authority of competent jurisdiction or other Person shall have been
instituted which would reasonably be expected to materially damage Seller if the
transactions contemplated hereunder are consummated.
7.3. Certificates. Buyer shall furnish Seller with such certificates
of its duly authorized officers and others to evidence compliance with the
conditions set forth in this Article VII as may be reasonably requested by
Seller.
7.4. Corporate Documents. Seller shall have received from Buyer
resolutions adopted by the board of directors of Buyer approving this Agreement,
the Ancillary Agreements and the transactions contemplated hereby and thereby,
certified by Buyer's corporate secretary, as applicable.
7.5. Consents. All governmental consents, approvals and waivers
necessary to effect the Closing shall have been obtained.
ARTICLE VIII.
CONDITIONS TO BUYER'S OBLIGATIONS
The obligations of Buyer to consummate the transactions provided for
hereby are subject, in the discretion of Buyer, to the satisfaction, on the
Closing Date, of each of the following conditions, any of which may be waived by
Buyer:
8.1. Representations, Warranties and Covenants. All representations
and warranties of Seller contained in this Agreement shall be true and correct
in all material respects at and as of the date of this Agreement and at and as
of the Closing, and Seller shall have
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performed and satisfied all material agreements and covenants required hereby to
be performed by it prior to the Closing.
8.2. Consents. All governmental consents, approvals and waivers
necessary to effect the Closing and for the operation of the Business by Buyer,
and all required third party consents to the assignment of any Contracts to
Buyer, shall have been obtained, and Buyer shall have received written evidence,
reasonably satisfactory to Buyer, that such consents have been obtained.
8.3. No Proceedings or Litigation. No Action by any governmental
authority of competent jurisdiction or other Person shall have been instituted
which would reasonably be expected to materially damage Buyer if the
transactions contemplated hereby are consummated.
8.4. Opinion of Counsel. Seller shall have delivered to Buyer an
opinion of counsel, dated as of the Closing Date, substantially in the form of
Exhibit B hereto.
8.5. Certificates. Seller shall furnish Buyer with such certificates
of its duly authorized officers and others to evidence compliance with the
conditions set forth in this Article VIII as may be reasonably requested by
Buyer.
8.6. Corporate Documents. Buyer shall have received from Seller
resolutions adopted by the board of directors of Seller approving this
Agreement, the Ancillary Agreements and the transactions contemplated hereby and
thereby, certified by Seller's corporate secretary.
8.7. Ancillary Agreements. Seller shall have executed and delivered
to Buyer the Ancillary Agreements.
8.8. [INTENTIONALLY OMITTED.]
8.9. [INTENTIONALLY OMITTED.]
8.10. Key Employees. Each Key Employee identified by Buyer pursuant
to
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Section 6.6 hereof shall have accepted the offer of employment made by Buyer to
such Key Employee and shall become an employee of Buyer (or an Affiliate of
Buyer) as of the Closing Date; provided, that such offer of employment is
substantially consistent with the current terms of employment between such Key
Employee and Seller.
8.11. [INTENTIONALLY OMITTED.]
8.12. Release of Encumbrances. All Encumbrances affecting the Assets
(other than Permitted Encumbrances) shall have been released and/or terminated,
and Seller shall have provided Buyer with evidence of such release and
termination reasonably acceptable to Buyer.
ARTICLE IX.
RISK OF LOSS
9.1. Risk of Loss. If any material portion of the Assets is destroyed
or damaged by fire or any other cause on or prior to the Closing Date, Seller
shall give written notice to Buyer as soon as practicable after, but in any
event within five (5) calendar days of, discovery of such damage or destruction,
including specification of the amount of insurance, if any, covering such Assets
and the amount, if any, which Seller is otherwise entitled to receive as a
consequence of such damage or destruction. Prior to the Closing, Buyer shall
have the option, which shall be exercised by written notice to Seller within ten
(10) calendar days after receipt of Seller's notice or if there are not ten (10)
calendar days prior to the Closing Date, as soon as practicable prior to the
Closing Date, of (a) accepting such Assets in their destroyed or damaged
condition in which event Buyer shall be entitled to the proceeds of any
insurance or other proceeds payable with respect to such loss, or the cash
equivalent thereof, and the full Purchase Price shall be paid for such Assets,
(b) if agreed by Seller and Buyer, excluding such Assets from this Agreement, in
which event the Purchase Price shall be reduced by the amount allocated to
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such Assets, as mutually agreed between the parties or (c) after providing
Seller with a reasonable opportunity to repair or replace the damaged or
destroyed Assets, terminating this Agreement.
ARTICLE X.
ACTIONS BY BUYER AND SELLER AFTER THE CLOSING
10.1. Further Actions. On and after the Closing Date, Buyer and Seller
will take all appropriate actions and execute all documents, instruments or
conveyances of any kind which may be reasonably necessary or advisable to
confirm or effect Buyer's ownership, possession and control (in accordance with
this Agreement) of the Assets and assumption of the Assumed Liabilities.
10.2. Survival of Representations, Etc. The representations,
warranties, covenants and agreements of Seller on the one hand, and Buyer on the
other hand, contained herein shall survive the Closing Date for the period set
forth in this Section 10.2. All such representations and warranties and all
claims and causes of action with respect thereto shall terminate upon expiration
of three (3) years after the Closing Date, except that the representations and
warranties in Sections 4.1, 4.2, 4.4, 4.7, 4.9, 4.13, 4.17 and 4.21, and all
claims and causes of action with respect thereto, shall survive until 90 days
after the expiration of the applicable statute of limitations (with extensions)
with respect to the matters addressed in such Sections. Each such covenant and
agreement shall survive the Closing and remain in full force and effect unless
otherwise limited by its terms. The termination of the representations and
warranties provided herein shall not affect the rights of a party in respect of
any Claim made by such party in a writing received by the other party prior to
the expiration of the applicable survival period provided herein.
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10.3. Books and Records. Buyer agrees that it will cooperate with and
make available to Seller, during normal business hours, all Books and Records,
information and employees (without substantial disruption of employment) which
are necessary or useful in connection with any tax inquiry, audit, investigation
or dispute, any litigation or investigation or any other matter requiring any
such Books and Records, information or employees for any reasonable business
purpose. Except as otherwise required in Section 10.4, Seller shall bear all of
the out-of-pocket costs and expenses (including, without limitation, attorneys'
fees, but excluding reimbursement for salaries and employee benefits) reasonably
incurred in connection with providing such Books and Records, information or
employees. All information received pursuant to this Section 10.3 shall be
subject to the confidentiality provisions of Section 10.6.
10.4. Indemnification.
(a) By Seller. Seller shall indemnify, save and hold harmless
Buyer, its Affiliates and Subsidiaries, and their respective directors,
officers, shareholders and employees (the "Buyer Indemnities") from and against
any and all costs, losses, taxes, liabilities, damages, lawsuits, deficiencies,
claims, demands, and expenses (whether or not arising out of third-party
claims), including, without limitation, reasonable attorneys' fees and all
reasonable amounts paid in investigation, defense or settlement of any of the
foregoing herein, (collectively, "Damages"), incurred in connection with,
arising out of, or resulting from (i) any breach of any representation or
warranty made by Seller in this Agreement (including, without limitation, claims
for Damages asserted within two years after the Closing Date against Buyer or
its Affiliates by licensees or customers of Buyer that would not have been
incurred had such representations and warranties been true and correct); (ii)
any breach of any covenant or agreement made by Seller in this Agreement; and
(iii) any Excluded Liability.
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(b) By Buyer. Buyer shall indemnify, save and hold harmless
Seller, its Affiliates and Subsidiaries, and their respective directors,
officers, shareholders and employees (the "Seller Indemnities" and together with
the Buyer Indemnities, the "Indemnities") from and against any and all Damages
incurred in connection with, arising out of, or resulting from (i) any breach of
any representation or warranty made by Buyer in this Agreement; (ii) any breach
of any covenant or agreement made by Buyer in this Agreement; and (iii) any
Assumed Liability.
(c) The term "Damages" as used in this Section 10.4 is not
limited to matters asserted by third parties, but includes Damages incurred or
sustained by an Indemnitee in the absence of third party claims. Payments by an
Indemnitee of amounts for which such Indemnitee is indemnified hereunder shall
not necessarily be a condition precedent to recovery.
(d) Defense of Claims. If a claim for Damages (a "Claim") is to
be made by an Indemnitee, such Indemnitee shall, subject to Section 10.2, give
written notice (a "Claim Notice") to the indemnifying party as soon as
practicable after such Indemnitee becomes aware of any fact, condition or event
which may give rise to Damages for which indemnification may be sought under
this Section 10.4. If any lawsuit or enforcement action is filed against any
Indemnitee hereunder, notice thereof (a "Third Party Notice") shall be given to
the indemnifying party as promptly as practicable (and in any event within
fifteen (15) calendar days after the service of the citation or summons). The
failure of any Indemnitee to give timely notice hereunder shall not affect
rights to indemnification hereunder, except to the extent that the indemnifying
party demonstrates actual damage caused by such failure. After providing the
Third Party Notice, the Indemnitee shall be entitled, if it so elects, (i) to
control the defense and investigation of such lawsuit or action, (ii) to employ
and engage attorneys of its own choice to
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handle and defend the same, at the indemnifying party's cost, risk and
expense, and (iii) to compromise or settle such claim, which compromise or
settlement shall be made only with the written consent of the indemnifying
party, such consent not to be unreasonably withheld. The indemnifying party
shall cooperate in all reasonable respects with the Indemnitee and such
attorneys in the investigation, trial and defense of such lawsuit or action and
any appeal arising therefrom; and the indemnifying party may, at its own cost,
participate in the investigation, trial and defense of such lawsuit or action
and any appeal arising therefrom. The parties shall also cooperate with each
other in any notifications to insurers. If the Indemnitee fails to defend such
claim within fifteen (15) calendar days after providing the Third Party Notice
or notifies the indemnifying party that it does not intend to defend such claim,
the indemnifying party will undertake the defense, compromise or settlement of
such claim and the Indemnitee shall have the right to participate therein at its
own cost; provided, however, that such claim shall not be compromised or settled
without the written consent of the Indemnitee, which consent shall not be
unreasonably withheld. In the event the indemnifying party assumes the defense
of the claim, the indemnifying party will keep the Indemnitee reasonably
informed of the progress of any such defense, compromise or settlement.
(e) Brokers and Finders. Pursuant to the provisions of this
Section 10.4, each of Buyer and Seller shall indemnify, hold harmless and defend
the other party from the payment of any and all broker's and finder's expenses,
commissions, fees or other forms of compensation which may be due or payable
from or by the indemnifying party, or may have been earned by any third party
acting on behalf of the indemnifying party in connection with the negotiation
and execution hereof and the consummation of the transactions contemplated
hereby.
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10.5. Covenant Not To Compete. Following the Closing until the fifth
(5th) anniversary of the Closing Date, Seller shall not, directly or indirectly
through any Subsidiary or Affiliate of Seller, engage in any business that
competes, directly or indirectly, with the Business as currently conducted or
proposed to be conducted (hereinafter collectively, the "Protected Business") in
any country in which Buyer or its Affiliates now or hereafter conduct any
Protected Business. The term "Protected Business" shall include, without
limitation, the development of any computer software or program or other product
or service that would compete with the computer software or programs (including,
without limitation, Analytical Medical Systems) or other products or service
utilized or provided by the Business, except in connection with the provision of
services to any Affiliate of Buyer. Notwithstanding the foregoing, Seller may
develop computer software or programs, provided that (i) any such software
related to the operation of Medicare-certified home nursing services is used
only for internal development purposes of Seller and its Subsidiaries, (ii)
Seller does not sell, license, transfer or permit any Person to use in any other
manner the results of such development with respect to the operation of
Medicare-certified home health agencies, and (iii) Seller shall grant to Buyer a
perpetual, worldwide, royalty-free license to use, sell or license the results
of such development and any improvements or modifications thereto by Seller or
Buyer. The provisions of this Section 10.5 shall be deemed to be a separate
covenant in each of the countries referred to above. Seller acknowledges and
agrees that the time, scope, geographic area and other provisions of this
Covenant Not to Compete have been specifically negotiated by sophisticated
parties and that such provisions are reasonable under the circumstances. The
parties further agree that if, despite the foregoing acknowledgment, a court or
other tribunal of competent jurisdiction holds that any of the restrictions of
this Covenant Not to Compete are unenforceable, the maximum restrictions
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of time, scope or geographic area reasonable under the circumstances, as
determined by such court or tribunal, shall be substituted for any such
restrictions held unenforceable.
10.6. Confidentiality. Seller and its Affiliates have obtained
confidential information relating to the Business and the Assets. Following the
Closing, Seller and its Affiliates shall treat such information (including,
without limitation, the terms of this Agreement and the Ancillary Agreements) as
confidential, preserve the confidentiality thereof, not duplicate or use such
information and instruct its employees who have had access to such information
to keep confidential and not to use any such information unless such information
(i) is now or is hereafter disclosed, through no act or omission of Seller or
its Affiliates, in a manner making it available to the general public or (ii) is
required by law to be disclosed. Buyer and its Affiliates have obtained
confidential information relating to the business, operations and assets of
Seller. Following the Closing, Buyer and its Affiliates shall treat such
information (including, without limitation, the terms of this Agreement and the
Ancillary Agreements) as confidential, preserve the confidentiality thereof, not
duplicate or use such information and instruct its employees who have had access
to such information to keep confidential and not to use any such information
unless such information (i) is now or is hereafter disclosed, through no act or
omission of Buyer or its Affiliates, in a manner making it available to the
general public or (ii) is required by law to be disclosed.
ARTICLE XI.
MISCELLANEOUS
11.1. Termination.
(a) Termination. This Agreement may be terminated at any time
prior to Closing by mutual written consent of Buyer and Seller.
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(b) In the Event of Termination. In the event of termination of
this Agreement:
(i) Each party will redeliver all documents, work papers
and other material of any other party relating to the transactions contemplated
hereby, whether so obtained before or after the execution hereof, to the party
furnishing the same; and
(ii) No party hereto shall have any further liability or
obligation to any other party to this Agreement, and the provisions of this
Agreement (other than this Section 11.1(b) and Section 11.7) shall be of no
further force and effect; provided, however, that such termination shall not
relieve any part from liability for any breach of this Agreement occurring prior
to the proper termination of this Agreement.
11.2. Assignment. Neither this Agreement, the Ancillary Agreements nor
any of the rights or obligations hereunder or thereunder may be assigned by any
party without the prior written consent of the other parties thereto; except
that Buyer may, without such consent, (i) assign all such rights to any lender
as collateral security and assign all such rights and obligations to an
Affiliate of Buyer, (ii) after the Closing, assign such rights to a successor in
interest to Buyer which shall assume all obligations and liabilities of Buyer
under this Agreement and the Ancillary Agreements and (iii) assign and/or
subcontract any rights or obligations under the Ancillary Agreements to any
Person; provided that no assignment of this Agreement shall release the
assigning party from responsibility for its obligations hereunder. Subject to
the foregoing, this Agreement and the Ancillary Agreements shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns, and no other Person shall have any right, benefit or
obligation under this Agreement as a third party beneficiary or otherwise.
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11.3. Notices. All notices under this Agreement shall be in writing
and shall be deemed to have been duly given when received if personally
delivered; when transmitted if transmitted by telecopy, electronic or digital
transmission method provided that such transmission is confirmed by telephone;
the day after it is sent, if sent for next day delivery to a domestic address by
overnight mail; and upon receipt, if sent by certified or registered mail,
return receipt requested. In each case notice shall be sent to:
If to Seller, addressed to:
Amedisys, Inc.
0000 Xxxxx Xxxxxxxx Xxxxxx Xxxx.
Xxxxx 000
Xxxxx Xxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
With a copy to:
Amedisys, Inc.
0000 Xxxxx Xxxxxxxx Xxxxxx Xxxx.
Xxxxx 000
Xxxxx Xxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx
If to Buyer, addressed to:
CPII Acquisition Corp.
c/o Capitol Partners, LLC
0000 Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Managing Director
With a copy to:
Xxxxxx & Xxxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx X. Xxxxxx
or to such other place and with such other copies as either party may designate
as to itself by written notice to the others.
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11.4. Choice of Law. This Agreement shall be construed, interpreted
and the rights of the parties determined in accordance with the internal law,
and not the law of conflicts, of the State of Delaware.
11.5. Entire Agreement; Amendments and Waivers. This Agreement, the
Ancillary Agreements, together with all exhibits and schedules hereto and
thereto (including the Disclosure Schedule), constitutes the entire agreement
among the parties pertaining to the subject matter hereof and supersedes all
prior agreements, understandings, negotiations and discussions, whether oral or
written, of the parties. This Agreement may not be amended or supplemented
except by an instrument in writing signed on behalf of each of the parties
hereto. No modification or waiver of this Agreement shall be binding unless
executed in writing by the party to be bound thereby. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any
other provision hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
11.6. Multiple Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
11.7. Expenses. Except as otherwise specified in this Agreement, each
party hereto shall pay its own legal, accounting, out-of-pocket and other
expenses incident to this Agreement and to any action taken by such party in
preparation for carrying this Agreement into effect.
11.8. Invalidity. In the event that any one or more of the provisions
contained in this Agreement or in any other instrument referred to herein,
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, then to the maximum extent permitted by law,
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such invalidity, illegality or unenforceability shall not affect any other
provision of this Agreement or any other such instrument.
11.9. Titles. The titles, captions or headings of the Articles and
Sections herein are inserted for convenience of reference only and are not
intended to be a part of or to affect the meaning or interpretation of this
Agreement.
11.10. Publicity. Except as otherwise required by applicable law,
neither Buyer nor Seller shall issue any press release or make any public
statement regarding the transactions contemplated hereby, prior to the Closing
Date, without prior approval of the other party.
11.11. Limitation of Liability. The parties agree that no officer,
director, employee or stockholder of any party shall be responsible for the
liabilities or obligations of such party hereunder and no party shall make any
claim or demand, or file any action against, or otherwise seek to recover any
amount from, any officer, director, employee or stockholder of any other party
hereto pursuant to this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed on their respective behalf, by their respective officers thereunto duly
authorized, all as of the day and year first above written.
AMEDISYS, INC.
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxx
Its: Chief Executive Officer
By:
---------------------------------
Name:
---------------------------------
Its:
---------------------------------
CPII ACQUISITION CORP.
By: /s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
Its: Managing Director
By: /s/ Xxxxx X. Xxxxx
---------------------------------
Name: Xxxxx X. Xxxxx
Its: Managing Director
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