AGREEMENT FOR PURCHASE AND SALE OF ASSETS
This Agreement For Purchase And Sale Of Assets ("Agreement") is made as
of February 2, 2004, at Toluca Lake, California, by and among PRACTICEXPERT
INC., a California corporation ("Parent"), its wholly owned subsidiary, PRACTICE
XPERT SERVICES CORP., ("Services") (collectively "Buyer"), a California
corporation, both having their principal office at 0000 Xxxxxxxx Xxxx. #000,
Xxxxxx Xxxx, XX 00000 on the one hand and Cancer Care Network, Inc., an Oklahoma
corporation, ("Seller").
RECITALS
WHEREAS, Seller desires to sell and Buyer desires to purchase from
Seller the assets of Seller identified on Exhibit A, which is attached hereto
and incorporated herein by reference (the "Assets").
WHEREUPON, in consideration of the mutual covenants, agreements,
representations, and warranties contained in this Agreement, the parties agree
as follows:
1. DEFINITIONS: When used in this Agreement, the following terms shall be
defined as follows:
1.1. "Agreement" shall mean this Agreement For Purchase And Sale Of
Assets and any Exhibits and Schedules attached hereto or otherwise
incorporated herein by reference.
1.2. "Assets" shall mean those assets of Seller identified on Exhibit A
hereto.
1.3. "Client Contracts" shall mean the billing and management contracts
which CCN has with its customers which are listed as part of the
Assets.
1.4. "Closing" shall have the meaning set forth in Section 2. 1.5.
"Closing Date" shall have the meaning set forth in Section 2.
1.6. "Covered Employees" shall mean those employees of Seller which are
listed on Schedule 8.1 hereto; provided however, Covered Employees
shall not include Key Employees.
1.7. "Key Employees" shall mean Xx. Xxxx X. Xxxxxxxx, Xx., Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxx and Xxxxx Xxxxxx.
1.8. "Knowledge" as to any party hereto shall mean the knowledge of such
party or any officer or director of such party after due
investigation.
1.9. "Laws" shall mean the statutes, laws, rules, regulations,
ordinances, codes, directives, writs, injunctions, decrees,
judgments, and orders of any governmental (whether foreign, federal,
state, local, or otherwise) legislative, regulatory or
administrative agency, court or other governmental body, promulgated
generally and not specifically directed to both of the parties to
this Agreement.
1.10. "Material Adverse Effect" shall mean any condition, occurrence or
effect, which is materially adverse to the value of the Assets.
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1.11. "Purchase Price" shall have the meaning set forth in Section 3.
2. PURCHASE AGREEMENT. Subject to the terms and conditions set forth in this
Agreement, on the Closing Date, Seller, in consideration of the payment by
Buyer of the Purchase Price will transfer and convey full title and
ownership of the Assets to Buyer, and Buyer will acquire the Assets from
Seller ("Closing"). The Closing shall occur on or before February 27, 2004
("Closing Date").
3. PURCHASE PRICE
3.1. The Purchase Price ("Purchase Price") will be five million five
hundred thousand dollars ($5,500,000.00) and will be paid as
follows:
3.1.1. ONE HUNDRED THOUSAND DOLLARS AND NO/100 (US$100,000.00)
("Down Payment") in immediately available funds will be paid
by Buyer to Seller upon execution of this Agreement to ensure
the good faith performance of Buyer. Such Down Payment shall
be nonrefundable unless Seller (i) fails to obtain any
consents required by any Client Contracts so as to allow the
assignment by Seller such number of Client Contracts
representing a minimum of eighty percent (80%) of the net
revenue earned by Seller from all Client Contracts for
services rendered in 2003 or (ii) fails to otherwise secure
the consents and approvals required to transfer the other
Assets free of any mortgages, liens, pledges, charges,
encumbrances, equities, claims, easements, rights of way,
covenants, conditions, or restrictions such that there is a
material impairment of the use of the Assets and/or the
ability of the Buyer to continue to use the Assets in the
manner which they are currently used. In the event that this
Agreement is terminated due to Sellers failure to meet its
obligations under this Section 3.1.1, or if the contract
reference in Section 4.4 is not executed and delivered at
Closing, the Down Payment shall be fully refundable to Buyer
immediately upon the date that the termination of this
Agreement becomes effective.
3.1.2. Four million nine hundred thousand dollars ($4,900,000.00)
shall be paid to Seller in immediately available funds at
Closing.
3.1.3. The balance of the Purchase Price, to wit five hundred
thousand dollars ($500,000.00), shall be paid by delivering to
Seller at Closing shares of Parent's restricted common stock.
The amount of such stock shall be the amount derived from
dividing 500,000 by the average bid price for such Parent's
stock for the five trading days prior to Closing. The stock
will be unregistered shares of the Parent and will be
"restricted stock" as defined under SEC Rule 144, which may
not be sold on the open market for a period of at least one
year.
3.1.4. Subject to the provisions of Section 4.5 and any other
sections of this Agreement allowing a party to terminate this
Agreement, in the event that Seller (i) fails to obtain any
consents required by the terms of any Client Contracts to make
a valid assignment of any of such Client
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Contracts the parties agree to adjust the purchase price (as
hereinafter set forth) by a percentage determined by dividing
the net revenue earned by Seller for services performed in
2003 on such Client Contract(s) for which a consent for an
assignment was not obtained or for assignments not otherwise
made divided by the total net revenue received by Seller from
all Client Contracts for services performed in 2003.
3.1.5. Notwithstanding the foregoing, Buyer shall be given
allowance(s) at Closing in the following amounts:
3.1.5.1. An amount, not to exceed the amount shown on Schedule
3.1.5.1, necessary to install purchase a new Toshiba
phone system by American Telecom with services
substantially the same as currently used by Seller at
its offices in Oklahoma City to allow Buyer to purchase
and install a phone system in the space to be subleased
from Seller by Buyer; and
3.1.5.2. An amount, not exceed two thousand dollars
($2000.00), if Buyer elects to install its own T-1 line
and any necessary router(s) and switch(s) for use by
Buyer in the space to be subleased from Seller in
Oklahoma City pursuant to this Agreement; and
3.1.5.3. The amount of $36,247.50 for the assignment or
transfer of Seller's current license and server
license(s) with IBM and Mysis as shown on Schedule
3.1.5.3.
3.1.6. Prepaid items will be prorated at Closing based on a 365 day
year.
4. OTHER TERMS. The obligation of either party to consummate this transaction
is subject to the following:
4.1. Completion of due diligence by Buyer of Seller, and by Seller of
Buyer, as each determines is needed;
4.2. The approval of this transaction by the respective boards of
directors of each company;
4.3. Buyer successfully raising the cash required to close the
transaction.
4.4. The entering into of an employment contract with a senior
manager/divisional president who will have primary operating
responsibility for the Assets on terms and conditions as generally
set forth in Exhibit 2 hereto or upon such other terms and
conditions as are approved by Buyer.
4.5. Seller assigning to Buyer such number of Client Contracts or to the
extent necessary, obtaining the consent to such assignments,
cumulatively representing a minimum of ninety percent (90%) of the
net revenue earned by Seller from services performed by Seller in
2003 pursuant to the Client Contracts;
4.6. The termination by Seller of the Covered Employees.
4.7. The assignment by Seller of the contracts of the Key Employees
unless the Seller and Buyer can reach mutual agreement on the amount
of any reduction
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in the Purchase Price as a result of the failure of Seller to
deliver the assignment of such contracts of said Key Employees. .
4.8. The commitment by a majority of the Covered Employees to become at
will employees for Buyer effective upon Closing.
4.9. The completion of all Schedules satisfactory to both Buyer and
Seller.
4.10. The approval by IBM and Mysis to allow the assignment of the IBM and
Mysis licenses referenced in Section 3.1.5.3 above for an amount not
to exceed five thousand dollars ($36,247.50).
4.11. The execution of a cost sharing agreement if Seller elects to use
Buyer's current T-3 line, Seller's web server or mail server after
Closing.
5. WARRANTIES OF SELLER. Seller warrants that:
5.1. Seller is a corporation duly organized, validly existing, and in
good standing under the laws of Oklahoma and has all necessary
corporate powers to own its properties and operate its business as
now owned and operated by it.
5.2. Except to the extent set forth on Schedule 5.2, Seller has full
power to transfer the Assets to Buyer without obtaining the consent
or approval of any other person or governmental authority.
5.3. Exhibit "A" to this Agreement is a complete and accurate list of all
of the Assets to be sold by Seller pursuant to terms set forth in
this Agreement. Such Exhibit A gives (i) an accurate brief
description of such Assets; (ii) identifies the contracts between
Seller and the customers and clients of Seller and the Seller's
accounts receivables, all trade receivables, all bank accounts,
brokerage accounts, CD's, deposits, rights, licenses which are
included within such Assets; and (iii) the location of all such
Assets.
5.4. Since the preparation of Exhibit A, there has not been any Material
Adverse Effect on the value of the Assets, except changes occurring
in the ordinary course of business.
5.5. Since the date of preparation of Exhibit "A" as shown on said
Exhibit A, there has been no:
5.5.1. transactions by Seller except in the ordinary course of
business, which would have a Material Adverse Effect on the
Assets;
5.5.2. Material adverse change in the financial statements of Seller
attached hereto as Exhibit C; 5.5.3. Destruction, damage to,
or loss of any of the Assets; 5.5.4. Amendment or termination
of any contract, agreement, or license listed on Exhibit A to
which Seller is a party, which would have a Material Adverse
Effect on the Assets;
5.5.5. Mortgage, pledge, or other encumbrance of any asset of Seller
which would which would have a Material Adverse Effect on the
Assets;
5.5.6. Waiver or release of any right or claim of Seller, except in
the ordinary course of business ,which would have a Material
Adverse Effect on the Assets;
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5.5.7. Commencement, notice, or threat of commencement of any civil
litigation or governmental proceeding against Seller or
investigation of its affairs which would have a Material
Adverse Effect on the Assets;
5.5.8. Agreement by Seller to do any of the things described in the
preceding clauses 5.5.1 through 5.5.7.
5.6. Except as set forth on Schedule 5.6, Seller does not have any debt,
liability, or obligation of any nature, whether
accrued, absolute, contingent, or otherwise, and whether due or to
become due, that would have a Material Adverse Effect the Assets set
forth in Exhibit "A" to this Agreement. Except as set forth on
Schedule 5.6, the parties agree that this transaction constitutes
the sale and purchase of the Assets of the Seller only and does not
include assumption or acquisition of the Seller's liabilities or
debt except to the extent that after Closing Buyer incurs debts or
liabilities relating to the Client Contracts, nor does it include
the acquisition of the capital stock of the Seller, which shall be
retained by the Seller.
5.7. Within the times and in the manner prescribed by Law, Seller has
filed all federal, state, and local tax returns required by law and
has paid all taxes, assessments, and penalties due and payable to
the extent that the failure to file the same would have a Material
Adverse Effect on the Assets.
5.8. Except as set forth on Schedule 5.8, none of the Assets set forth in
Exhibit "A", is held under any lease, security agreement,
conditional sales contract, or other title retention or security
arrangement, or is located other than in the possession of Seller.
5.9. To the best of the Knowledge of Seller, all accounts receivable of
Seller shown on Exhibit "A" arose from valid services in the
ordinary course of business.
5.10. To the extent that the same are a part of the Assets, Exhibit "A" to
this Agreement also sets forth all trade names, registered
trademarks, service marks, and registered copyrights and their
registrations, owned by Seller or in which it has any rights or
licenses, together with a brief description of each. Seller have no
knowledge of any infringement or alleged infringement by others of
any trade name, trademark, service xxxx, or copyright identified.
5.11. Seller does not own or have rights in any patents, inventions,
industrial models, processes, designs, and applications for patents
owned by Seller or in which it has any rights, licenses, or
immunities.
5.12. To the extent that the same are a part of the Assets, Exhibit "A" to
this Agreement includes a complete list, without extensive or
revealing descriptions, of Seller's trade secrets, including all
secret formulas, recipes, customer lists, processes, know-how,
computer programs and routines, and other technical data. The
specific location of each trade secret's documentation, including
its complete description, specifications, charts, procedures, and
other material relating to it, is also set forth in that Exhibit.
Each trade secret's documentation is current, accurate, and
sufficient in detail and content to identify and explain
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it and to allow its full and proper use by Buyer without reliance on
the special knowledge or memory of others.
5.12.1. Seller is the sole owner of each of these trade secrets,
free and clear of any liens, encumbrances, restrictions, or
legal or equitable claims of others. Seller has taken all
reasonable security measures to protect the secrecy,
confidentiality, and value of these trade secrets; any of
their employees and any other persons who, either alone or in
concert with others, developed, invented, discovered, derived,
programmed, or designed these secrets, or who have knowledge
of or access to information relating to them, have been put on
notice and, if appropriate, have entered into agreements that
these secrets are proprietary to Seller and not to be divulged
or misused.
5.12.2. All these trade secrets are presently valid and protectable
and are not part of the public knowledge or literature; they
have not, to Seller's or Seller's knowledge, been used,
divulged, or appropriated for the benefit of any past or
present employees or other persons, or to the detriment of
Seller.
5.13. Except to the extent set forth in Schedule 5.13, Seller has good and
marketable title to all the Assets and interests in such Assets,
whether real, personal, mixed, tangible, or intangible; and except
as set forth on said Schedule 5.13, all of the Assets are free and
clear of restrictions on or conditions to transfer or assignment and
free and clear of mortgages, liens, pledges, charges, encumbrances,
equities, claims, easements, rights of way, covenants, conditions,
or restrictions, except for possible minor matters that, in the
aggregate, are not substantial in amount and do not materially
detract from or interfere with the present or intended use of any of
these assets or materially impair business operations. Seller is not
in default or in arrears in any material respect under any lease
which is included within the Assets. Except as set forth on said
Schedule 5.13, all real property and tangible personal property of
Seller included in the Assets is in good operating condition and
repair, ordinary wear and tear excepted.
5.14. Seller does not occupy any real property in violation of any law,
regulation, or decree.
5.15. Except to the extent set forth in Schedule 5.15, Seller is not a
party to any distributor's or manufacturer's representative or
agency agreement; any output or requirements agreement; any
agreement not entered into in the ordinary course of business; any
indenture, mortgage, deed of trust, or lease.
5.16. Seller has not received notice of any violation of any applicable
federal, state, or local statute, law, or regulation (including any
applicable building, zoning, environmental protection, or other law,
ordinance, or regulation) which if adversely determined to Seller
would have any Material Adverse Effect on the Assets; and to the
best of the Knowledge of Seller and Seller, there are no such
violations which would have any Material Adverse Effect on the
Assets.
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5.17. There is no pending, or, to the Knowledge of Seller, threatened,
suit, action, arbitration, or legal, administrative, or other
proceeding, or governmental investigation which would have any
Material Adverse Effect on the Assets . Seller is not in default
with respect to any order, writ, injunction, or decree of any
federal, state, local, or foreign court, department, agency, or
instrumentality which would have any Material Adverse Effect on the
Assets. Neither Seller is presently engaged in any legal action to
recover money due to any of them or damages sustained by any of them
which would have any Material Adverse Effect on the Assets.
5.18. Except to the extent set forth in Schedule 5.18,the consummation of
the transactions contemplated by this Agreement will not result in
or constitute any of the following:
5.18.1. a breach of any term or provision of this Agreement;
5.18.2. a default or an event that, with notice, lapse of time, or
both, would be a default, breach, or violation of the articles
of incorporation or bylaws of Seller or any lease, license,
promissory note, conditional sales contract, commitment,
indenture, mortgage, deed of trust, or other agreement,
instrument, or arrangement to which Seller or Seller is a
party or by which any of them or the property of any of them
is bound to the extent that it would have a Material Adverse
Effect on the Assets;
5.18.3. an event that would permit any party to terminate any Client
Contracts or to accelerate the maturity of any indebtedness or
other obligation of Seller which would have a Material Adverse
Effect on the Assets; or
5.18.4. the creation or imposition of any lien, charge, or
encumbrance on any of the properties of Seller.
5.19. Except as set forth in Schedules 5.2, 5.13 or 5.18, Seller has the
right, power, legal capacity, and authority to enter into and
perform its obligations under this Agreement; and no approvals or
consents of any persons other than Seller are necessary in
connection with it.
5.20. The execution and delivery of this Agreement by Seller has been duly
authorized by all necessary corporate action.
5.21. Neither Seller, nor any officer or director of Seller, nor any
spouse or child of any of them has any direct or indirect interest
in any competitor, supplier, or customer of Seller or in any person
from whom or to whom Seller leases any real or personal property, or
in any other person with whom Seller is doing business to the extent
that it would have a Material Adverse Effect on the Assets.
5.22. None of the warranties made herein by Seller contains omits to state
any material fact necessary to make the statements made.
6. BUYER REPRESENTATIONS. Buyer and Parent represent and warrant to Buyer
that:
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6.1. Buyers are both corporations duly organized, existing, and in good
standing under the laws of California.
6.2. The execution and delivery of this Agreement and the consummation of
this transaction by Buyer have been duly authorized, and no further
corporate authorization is necessary on the part of Buyer.
6.3. The execution, delivery and performance of this Agreement by Buyer
and the issuance of any Buyer stock pursuant to this Agreement will
not:
6.3.1. violate Buyers' Certificates of Incorporation, as amended, or
Bylaws or any Law to which either Buyer is subject or by which
either Buyer may be bound, or (with or without giving notice
or the lapse of time or both) breach, or
6.3.2. conflict with any contract, agreement, or other commitment to
which either of Buyer is a party or by which Buyer is or may
be bound, or
6.3.3. result in the creation or imposition of any Lien against or
upon the Parent's Shares to be delivered to Seller at Closing.
6.4. Other than as disclosed in its public filings, there is no
litigation, proceeding (arbitral or otherwise), claim or
investigation of any nature, pending or, to Buyer's best Knowledge,
threatened, against Buyer that reasonably could be expected to
adversely affect Buyer's ability to perform in accordance with the
terms of this Agreement.
6.5. Neither Buyer nor any officer, director, partner or employee of
Buyer has been permanently or temporarily enjoined or barred by any
legal judgment from engaging in or continuing any conduct or
practice in connection with the activities of Buyer as currently
conducted; and there is not in existence any legal judgment
requiring Buyer to take any action of any kind with respect to the
assets or properties owned or leased by it, or its activities, or to
which Buyer or its activities, properties or assets are otherwise
subject or by which they are otherwise bound or affected.
6.6. The conduct by Buyer of its activities as currently conducted does
not violate or infringe any Laws currently in effect, or, to the
Knowledge of Buyer, proposed to become effective; and Buyer has not
received any notice of any violation by Buyer of any Laws applicable
to Buyer or their respective activities as currently conducted; and
Buyer does not know of any basis for the allegation of any such
violation.
6.7. Buyer has not dealt with, or made any arrangements or agreements
with any third party in connection with the transactions
contemplated by this Agreement so as to give rise to any claims for
brokerage commissions, finders fees or similar compensation.
6.8. Exhibit 4 includes true, complete and current copies of each Buyer's
Certificates of Incorporation, as amended.
6.9. Except as set forth on Schedule 6.9 hereto, no filing or
registration with, no permit, authorization, counsel or approval of,
and no notice to, any federal, state or local government or any
court, administrative or regulatory agency or commission or other
governmental authority or agency, domestic or foreign, or other
public body or authority or any other Person is necessary or
required in connection with the execution and delivery of this
Agreement by Buyer or for the consummation by Buyer of the
transactions contemplated by this Agreement.
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7. COVENANTS OF SELLER. Seller covenants that from the date of this Agreement
until the Closing:
7.1. Subject to applicable Laws, Buyer and its counsel, accountants, and
other representatives will have full access during normal business
hours to all properties, books, accounts, records, contracts, and
documents of or relating to Seller. Seller will furnish or cause to
be furnished to Buyer and its representatives all data and
information concerning the business, finances, and properties of
Seller that may reasonably be requested.
7.2. Between the execution of this Agreement and the Closing, Seller will
carry on its respective businesses and activities, in a manner which
will not have a Material Adverse Effect on the Assets. Between the
execution of this Agreement and the Closing, Seller shall conduct
all business transactions as and in the ordinary course, so as to
minimize any potential Material Adverse Effect on the Assets.
7.3. Between execution of this Agreement and Closing, Seller shall
preserve its present relationships with suppliers, customers, and
others having business relationships with Seller to the extent that
the failure to do so would have a Material Adverse Effect on the
Assets. Seller shall immediately notify Buyer of any changes,
cancellations, modifications, alterations, or other events which
affect Seller's present relationships with suppliers, customers, and
others having business relationships with Seller to the extent they
have a Material Adverse Effect on the Assets so that Buyer can
assess the impact of such changes on the viability of the proposed
purchase, which assessment shall be subject to a reasonable
interpretation of Material Adverse Effect.
7.4. Seller will not, or will not agree to: (1) make any change in
compensation payable to any Covered Employee; (2) make any change in
benefits payable to any Covered Employee under any bonus or pension
plan or other contract or commitment, except to the extent that it
is done for all employees of Seller and or its parent company; or
(3) modify any collective bargaining agreement to which it is a
party or by which it may be bound.
7.5.1 Seller will not or will not agree to do, without Buyer's
consent, any of the following: Enter into any contract,
commitment, or transaction not in the usual and ordinary
course of its business to the extent that the same would have
a Material Adverse Effect on the Assets. Seller shall
immediately notify Buyer of any changes, cancellations,
modifications, alterations, or other events which affect
Seller's present and/or future contractual relationships with
suppliers, customers, and others having business relationships
with Seller so that Buyer can assess the impact of such
changes on the viability of the proposed purchase, which
assessment shall be subject to a reasonable interpretation of
material adverse effect.
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7.5.2 To the extent that it would have a Material Adverse Effect on
the Assets, Seller will not modify, amend, cancel, or
terminate any of its existing contracts or agreements to the
extent they are listed in Exhibit A as apart of the Assets;
provided however, to the extent that a contract listed in
Exhibit A expires by its own terms, this Section shall not be
applicable.
7.6. As soon as reasonably practical after the execution and delivery of
this Agreement, and in any event on or before the Closing Date,
Seller will obtain the written consent of the persons required to
consent to any of the items herein and will furnish to Buyer
executed copies of those consents. Buyer will exercise its best
efforts, and promptly execute and deliver any documents and
instruments that may be reasonably required, to assist Seller in
obtaining such consents provided, however, that Buyer will not be
obligated under this Section to execute any guaranty, assumption of
liability, or other document or instrument requiring it to assume
obligations not contemplated by this Agreement.
7.7. As part of its due diligence and disclosure obligations under this
Agreement, Seller will document and describe it's trade secrets,
processes, or business procedures to be purchased by Buyer, in form
and content satisfactory to Buyer.
7.8. Seller hereby covenants that all agreements now in existence with
any third parties (these agreements are specifically included and
identified as "Assets" of the Seller and are itemized in Exhibit A),
which includes employment agreements, capital equipment and real
property lease agreements, client contracts, vendor agreements and
any other agreements of any title or description wherein Seller
derives income from a third party for services rendered, or is
contractually obligated to pay a third party, are fully assignable
to Buyer on terms identical to those now in existence, or will be
assigned to Buyer with terms equal to or superior to those now in
existence or consents therefore will be obtained. Subject to the
provisions of Section 3.1.4, that the value of the Assets to be
purchased hereby is in part, based upon the Seller's ability to
assign and Buyer's ability to assume all contracts and agreements
constituting a part of the Assets and that the inability to do so
would have a Material Adverse Effect on the Assets Seller shall
assist Buyer in obtaining approval of assignment of all contracts
and agreements related to the Assets prior to Closing.
7.9. All warranties of Seller set forth in this Agreement and in any
written statements delivered to Buyer by Seller under this Agreement
will also be true and correct on the Closing Date as if made on that
date.
7.10. Seller agrees that for two years following the Closing, Seller and
its parent or subsidiary companies will not offer billing services
for medical or radiation oncology practices except as allowed by
this Section ("Oncology Billing Services"); provided however, and
notwithstanding the foregoing, this Section shall not in any way
prohibit or prevent Seller from providing (i) Oncology Billing
Services for medical or radiation oncology practices located or
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practicing in cancer centers or hospitals owned in whole or in part
by Seller, or (ii) Oncology Billing Services for medical or
radiation oncology practices which are managed by Seller whereby
Sellers provides substantially all of the staffing, equipment,
fixtures, supplies and is responsible for substantially all of the
operating expenses of such oncology practice(s), or (iii) billing
services for medical practices other than medical or radiation
oncology.
8. OTHER AGREEMENTS:
8.1. As of the Closing Date, Seller shall terminate all Covered Employees
of Seller, and, as of the Closing Date, Buyer shall offer employment
to said Covered Employees at positions, salaries and wages
consistent with, but not more than the amounts presently paid for
the position, which salaries, wages and accrued vacation and sick
time of each such Covered Employee are set forth on Schedule 8.1.
Seller acknowledges that retention of the Covered Employees on terms
consistent with, but not more than the amounts presently paid for
the position, are a material term and consideration to Buyer in
entering into this Agreement.
8.2. Buyer shall assume and be solely responsible for up to one hundred
hours of each Covered Employees and Key Employees accrued paid time
off or vacation pay accrued as of the Closing Date and shall hold
Seller harmless therefrom. The salaries, wages and accrued vacation
and sick time of each such Covered Employee is set forth on Schedule
8.1.
8.3. Any former employee of Seller who is eligible to receive continual
coverage obligations (within the meaning of Code Section 4980B and
Part 6 of Subtitle B of Title 1 if ERISA) will remain covered
through Seller's COBRA provider. Immediately following the Closing
Date and as a result of the transactions contemplated by this
Agreement, Seller shall cease to offer COBRA benefits for any
applicable group health plan to Covered Employees who are employed
by Buyer as of or subsequent to Closing. Seller will thereby be
released from COBRA responsibility and liability for such employees.
8.4. As of the Closing Date, Seller will, at its expense or at the
expense of the applicable employee welfare benefit plan, (i)
terminate the participation of all Covered Employees from all such
plans and (ii) take such actions as are necessary to make, or cause
such plans to make, appropriate distributions to Covered Employees
to the extent required by, and in accordance with, such plans and
applicable Law, as determined by Seller and/or its counsel.
8.5. Buyer shall employ and retain for a period of ninety (90) days
following the Closing Date such Covered Employees as shall be
necessary to avoid any potential liability by Seller for a violation
of the Workers Adjustment and Retraining Notification Act, 29 U.S.
Xxxx.xx. 2101 et seq. (the "Warn Act") attendant to Seller's failure
to notify such Employees of a "mass layoff" or "plant Closing" (as
such terms are defined in the Warn Act). Prior to Closing, Seller
shall provide Buyer with a list of all Covered Employees subject to
this
11
provision. Buyer shall be liable and responsible for any
notification required under the Warn Act (or under any similar state
or local laws) and Buyer shall indemnify and hold Seller harmless
from and against any liability asserted against Seller under the
Warn Act as a result of Buyer's failure to comply with the provision
of the Warn Act as of or after the Closing Date.
8.6. Buyer agrees to assume and hold Seller and its officers and
directors harmless from the liabilities identified on Schedule 8.6
hereto ("Buyer Assumed Liabilities")
9. COVENANTS OF BUYER. In addition to its covenants set forth elsewhere in
this Agreement:
9.1. Subject to applicable Laws, Seller and its counsel, accountants, and
other representatives will have full access during normal business
hours to all properties, books, accounts, records, contracts, and
documents of or relating to Buyer. Buyer will furnish or cause to be
furnished to Seller and its representatives all data and information
concerning the business, finances, and properties of Buyer that may
reasonably be requested.
9.2. All warranties of Buyer set forth in this Agreement and in any
written statements delivered to Seller by Buyer under this Agreement
will also be true and correct on the Closing Date as if made on that
date.
9.3. Immediately following Closing, Buyer shall install a phone system
for its own use in the space to be subleased from Seller. To the
extent that following Closing Buyer utilizes the phone system of
Seller, Buyer shall reimburse Seller on demand or any costs incurred
by Buyer for the use of such phone system.
10. CONDITIONS PRECEDENT TO BUYER'S PERFORMANCE: In addition to the other
preconditions set forth in this Agreement to Buyer's duty to close the
transaction contemplated by this Agreement are also contingent on the
following:
10.1. At the Closing, Seller must deliver to Buyer the following
instruments, in form and substance satisfactory to Buyer and its
counsel:
10.1.1. A certificate executed by Seller, dated as of the Closing
Date, certifying that its representations and warranties in
this Agreement are true and correct on the Closing Date, as
though each representation and warranty had been made on that
date.
10.1.2. Delivery and execution of a sublease acceptable to both
Buyer and Seller for space at Seller's offices in Oklahoma
City, Oklahoma. The sublease shall be entered into on terms
equal to or superior to the terms of the lease which Seller is
presently subject to.
10.1.3. Seller shall have delivered to Buyer all Exhibits and
Schedules to this Agreement. Said Exhibits and Schedules are a
material part of this Agreement and neither Seller nor Buyer
cannot complete due diligence required to consummate this
purchase transaction until it has received an accurate and
complete set of Exhibits and Schedules.
12
10.2. The successful sale and transfer of the business and the Assets,
which are intended to be treated as a going concern sale to the
extent the Assets are involved, require that all agreements now in
existence with any third parties (specifically included and
identified as "Assets" of the Seller and itemized in Exhibit A),
which includes employment agreements, capital equipment and real
property lease agreements, client contracts, vendor agreements and
any other agreements of any title or description wherein Seller
derives income relating to the Assets from a third party for
services rendered, or is contractually obligated to pay a third
party, except to the extent otherwise set forth in this Agreement,
are fully assignable to Buyer on terms identical to those now in
existence, or will be assigned to Buyer with terms equal to or
superior to those now in existence. Seller acknowledges that the
value of the Assets to be purchased hereby, is in part based upon
the Seller's ability to assign and Buyer's ability to assume all
contracts and agreements constituting part of the Assets and that
the inability to do so could have a Material Adverse Effect on the
Assets and the business as a going concern.
10.2.1. A certificate from Seller dated as of Closing that between
the execution of this Agreement and Closing, (i) there has not
been any Material Adverse Effect in the Financial Statements
attached hereto as Exhibit C and (ii) that there has not been
any Material Adverse Effect in the value of the Assets except
changes incurred in the ordinary and usual course of their
respective businesses during that period that in the aggregate
are not materially adverse, and any other changes or
transactions contemplated by this Agreement, and (iii) that
Seller has not sustained any insured or uninsured loss or
damage to the Assets that would have a Materially Adverse
Effect on the Assets
10.3. The obligations of Buyer to purchase the Assets under this Agreement
are subject to the satisfaction, at or before the Closing, of all
the conditions set out herein. Buyer may waive any or all of these
conditions in whole or in part without prior notice; provided,
however, that no such waiver of a condition will constitute a waiver
by Buyer of any of its other rights or remedies, at law or in
equity, if Seller, or Seller are in default of any of their
representations, warranties, or covenants under this Agreement.
10.4. Seller must have performed, satisfied, and complied with all
covenants, agreements, and conditions required by this Agreement to
be performed or complied with by them, or any of them, by the
Closing Date.
10.5. Buyer will have received from counsel for Seller, an opinion dated
the Closing Date and rendered in accordance with the ABA Accord,
that (i) Seller is a corporation duly incorporated, validly
existing, and in good standing under the laws of the State of
Oklahoma, and has all necessary corporate power to transfer the
Assets pursuant to this Agreement; (ii) that this Agreement has been
duly and validly authorized and, when executed and delivered by the
13
Seller, will be valid, binding, and enforceable against each of them
in accordance with its terms, except as limited by bankruptcy and
insolvency laws and by other laws and equitable principles affecting
the rights of creditors generally; and (iii) that Counsel has no
actual knowledge, of any suit, action, arbitration, or legal,
administrative, or other proceeding or governmental investigation
pending or threatened against or affecting Seller which if adversely
decided would have a Material Adverse Effect on the Assets.
10.6. The execution and delivery of this Agreement by Seller, and the
performance of it's covenants and obligations under it, will have
been duly authorized by all necessary corporate action, and Buyer
will have received copies of all resolutions pertaining to that
authorization, certified respectively by the secretary of Seller.
10.7. Buyer will have received certificate of good standing certificate
for the State of Oklahoma for Seller dated as of a date not more
than five (5) days before the Closing date, of the appropriate State
Franchise Tax Board for Seller.
10.8. All necessary agreements and consents of any parties to the
consummation of the transactions contemplated by this Agreement, or
otherwise pertaining to the matters covered by it, will have been
obtained by Seller and delivered to Buyer. Seller acknowledges that
the going concern value of the Assets to be purchased hereby is in
part, based upon Buyer obtaining all necessary consents prior to
Closing, and that failure to obtain said consents could have a
Material Adverse Effect the Assets and the business as a going
concern. Seller shall obtain said consents prior to Closing and
acknowledges that failure to do so will necessarily defeat the
purpose and intent of this Agreement.
10.9. An employment agreement in the form set forth in Exhibit "B", dated
the Closing Date, will have been executed and delivered by Seller to
Buyer.
10.10. The form and substance of all certificates, instruments, opinions,
and other documents delivered to Buyer under this Agreement will be
satisfactory in all reasonable respects to Buyer and its counsel.
10.11. All Schedules shall be updated to the satisfaction of Buyer to
reflect any changes therein.
10.12. Seller shall deliver at Closing a change of name document for
filing with the Secretary of State's office in Oklahoma in such form
as necessary to allow Buyer to commence using the name "Cancer Care
Network" subsequent to Closing.
10.13. At or prior to Closing, Seller shall deliver to Buyer copies of any
leases for real estate leased by Seller at locations covered by any
Client Contracts.
11. Conditions precedent to Seller's performance: In addition to the other
preconditions set forth in this Agreement, Seller's duty to close the
transaction contemplated by this Agreement are also contingent on the
following:
14
11.1. The obligations of Seller to sell and transfer the Assets under this
Agreement are subject to the satisfaction, at or before the Closing,
of all the following conditions, which Seller may waive any or all
of these conditions in whole or in part without prior notice,
provided, however, that no such waiver of a condition will
constitute a waiver by Seller of any of its other rights or
remedies, at law or in equity, if Buyer should be in default of any
of its representations, warranties, or covenants under this
Agreement.
11.2. All warranties by Buyer contained in this Agreement or in any
written statement delivered by Buyer under this Agreement must be
true on and as of the Closing Date as though such representations
and warranties were made on and as of that date and a certificate to
that effect shall have been delivered by an officer of Buyer to that
effect.
11.3. Buyer must have performed and complied with all covenants and
agreements and satisfied all conditions that it is required by this
Agreement to perform, comply with, or satisfy before or at the
Closing.
11.4. Buyer will have furnished Seller with an opinion, dated the Closing
Date, of counsel for Buyer, in form and substance satisfactory to
Seller and their counsel, to the effect that:
11.4.1. Both of the Buyers are corporations duly incorporated,
validly existing, and in good standing under the laws of the
State of California and has all requisite corporate power to
perform its obligations under this Agreement.
11.4.2. All corporate proceedings required by Law or by the
provisions of this Agreement to be taken by Buyer on or before
the Closing Date, in connection with the execution and
delivery of this Agreement and the consummation of the
transactions contemplated by this Agreement, have been duly
and validly taken.
11.4.3. Buyer has the corporate power and authority to acquire the
Assets contemplated herein for the consideration set forth
herein.
11.4.4. Every consent, approval, authorization, or order of any
federal or California governmental agency or body that is
required for the consummation by Buyer of the transactions
contemplated by this Agreement has been obtained and will be
in effect on the Closing Date.
11.4.5. The agreement has been duly and validly authorized,
executed, and delivered by Buyer and is a valid and binding
obligation of Buyer enforceable against buyer in accordance
with its terms, except as limited by bankruptcy and insolvency
laws and by other laws and equitable principles affecting the
rights of creditors generally.
11.4.6. The consummation of the transactions contemplated by the
agreement does not violate or contravene any provision of the
articles of incorporation, bylaws, or to the best knowledge of
counsel any resolution of Buyer or of any indenture,
agreement, judgment, or order to which Buyer is a party or by
which Buyer is bound.
15
11.4.7. In rendering their opinion, counsel for Buyer may rely on
certificates of governmental authorities and on opinions of
associate counsel.
11.5. The board of directors and holders of a majority of the outstanding
stock of Buyer will have duly authorized and approved the execution
and delivery of this Agreement and all corporate action necessary or
proper to fulfill Buyer's obligations to be performed under this
Agreement on or before the Closing Date.
11.6. No action, suit, or proceeding before any court or any governmental
body or authority, pertaining to the transaction contemplated by
this Agreement or to its consummation, will have been instituted or
threatened on or before the Closing Date.
11.7. The form and substance of all certificates, instruments, opinions,
and other documents delivered to Seller under this Agreement will be
satisfactory in all reasonable respects to Seller and its counsel.
11.8. All necessary agreements and consents of any parties to the
consummation of the transactions contemplated by this Agreement, or
otherwise pertaining to the matters covered by it, will have been
obtained by Buyer and delivered to Seller.
11.9. At the Closing, Buyer must deliver to Seller the following
instruments and documents
11.9.1. The balance of he Purchase Price.
11.9.2. A certificate or certificates representing the Parent's
Shares, issued in the name of Seller in accordance with
Section 3.1.3 of this Agreement.
11.9.3. The opinion of counsel as provided herein.
11.10. All Schedules shall be updated to the satisfaction of Seller to
reflect any changes therein.
11.11. The execution by the parties of a billing contract wherein Buyer
will provide billing services for the radiation and medical oncology
practices at the cancer centers owned, operated or managed by Seller
in Midwest City, Ponca City , Xxxxxx and Chickasha Oklahoma.
12. Closing. The transfer by and between Buyer, Seller and Seller to (the
"Closing") will take place at the offices of Buyer, 0000 Xxxxxxxx Xxxx.
#000, Xxxxxx Xxxx, XX 00000, at 10:00 a.m. local time, on or before
February 27, 2004 (the "Closing Date")." The Closing Date may only be
changed by a written agreement signed by both Buyer and Seller.
13. Indemnification
13.1. Seller will indemnify, defend, and hold harmless Buyer against and
in respect of claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries, and deficiencies, including
interest, penalties, and
16
reasonable attorney fees, that Buyer may
incur or suffer, which arise, result from, or relate to any breach
of, or failure by Seller to perform, any of their representations,
warranties, covenants, or agreements in this Agreement or in any
schedule, certificate, exhibit, or other instrument furnished or to
be furnished by Seller under this Agreement. Seller's liability
under this Section will not, however, exceed the aggregate amount of
$1,000,000.00. In computing the amount to be paid by Seller under
his indemnity obligations, there will be deducted an amount equal to
any tax benefits actually received by Buyer, taking into account the
income tax treatment of the receipt of these payments.
13.2. Buyer will promptly notify Seller of the existence of any claim,
demand, or other matter to which Seller's indemnification
obligations would apply and will give him a reasonable opportunity
to defend the same at his own expense and with counsel of his own
selection; provided that Buyer will at all times also have the right
to participate fully in the defense at its own expense. If Seller,
within a reasonable time after this notice, fails to defend, Buyer
will have the right, but not the obligation, to undertake the
defense of, and to compromise or settle (exercising reasonable
business judgment), the claim or other matter on behalf, for the
account, and at the risk, of Seller. If the claim is one that cannot
by its nature be defended solely by Seller (including any federal or
state tax proceeding), Buyer will make available all information and
assistance that Seller may reasonably request.
13.3. Seller agrees not to divulge, communicate, use to the detriment of
Buyer or for the benefit of any other person or persons, or misuse
in any way, any confidential information or trade secrets of Seller,
including personnel information, secret processes, know-how,
customer lists, recipes, formulas, or other technical data. Seller
acknowledges and agrees that any information or data it has acquired
on any of these matters or items was received in confidence and as a
fiduciary of Seller.
13.4. Agreement by Buyer to assume Seller's obligations under the Client
Contracts.
13.5. Agreement by Buyer to assume the accounts payable set forth on
Schedule 13.5.
13.6. Buyer will indemnify and hold harmless Seller against, and in
respect of, claims, losses, expenses, costs, obligations, and
liabilities it may incur by reason of Buyer's breach of or failure
to perform any of its warranties, guaranties, commitments, or
covenants in this Agreement, or by reason of any act or omission of
Buyer, or any of its successors or assigns, after the Closing Date,
that constitutes a breach or default under, or a failure to perform,
any obligation, duty, or liability of any of the Seller under any of
the Assets to which it is a party or by which it is bound at the
Closing Date, but only to the extent to which Buyer expressly
assumes these obligations, duties, and liabilities under this
Agreement.
17
14. MISCELLANEOUS.
14.1. The parties covenant and agree that the terms of this Agreement are
sensitive and shall remain confidential and both Seller and Buyer
expressly agrees not to divulge the terms of the Agreement herein or
any information relating to compensation or any other matters
concerning the terms of Buyers acquisition and payments to the
Seller to any other person or party without the prior written
consent of the other party; provided however, a party may reveal
this Agreement and the nature of the transactions contemplated
thereby to Persons from whom consents are necessary to consummate
the transactions contemplated by this Agreement, including without
limitation Seller's clients, its bankers or other entities holding
any lien or security interest on any of the Assets, without the
express written consent of Buyer. Prior to the Closing, neither
Seller nor Buyer shall, without the prior written approval of the
other party, make any press release or other public announcement
concerning the transactions contemplated by this Agreement,
14.2. Each party will pay all its own costs and expenses incurred or to be
incurred by it in negotiating and preparing this Agreement and in
Closing and carrying out the transactions contemplated by this
Agreement.
14.3. The subject headings of the Sections and subsections of this
Agreement are included for convenience only and will not affect the
construction or interpretation of any of its provisions.
14.4. Unless the context clearly requires otherwise; Plural and singular
numbers will each be considered to include the other; The masculine,
feminine, and neuter genders will each be considered to include the
others; "Shall," "will," "must," "agree," and "covenants" are each
mandatory; "May" is permissive; "Or" is not exclusive; and
"Includes" and "including" are not limiting.
14.5. This agreement constitutes the entire agreement between the parties
pertaining to the subject matter contained in it and supersedes all
prior and contemporaneous agreements, representations, and
understandings of the parties. No supplement, modification, or
amendment of this Agreement will be binding unless executed in
writing by all the parties. No waiver of any of the provisions of
this Agreement will constitute a waiver of any other provision,
whether or not similar, nor will any waiver constitute a continuing
waiver. No waiver will be binding unless executed in writing by the
party making the waiver.
14.6. This Agreement may be executed simultaneously in one or more
counterparts, each of which will be considered an original, but all
of which together will constitute one and the same instrument.
Nothing in this Agreement, whether express or implied, is intended
to confer any rights or remedies under or by reason of this
Agreement on any persons other than the parties to it and their
respective successors and assigns. Nothing in this Agreement is
intended to relieve or discharge the obligation or liability of any
third persons to any party to this Agreement. No provision gives any
third persons any right of subrogation or action against any party
to this Agreement. A facsimile signature shall be binding on a party
hereto the same as an original signature.
18
14.7. This Agreement will be binding on, and will inure to the benefit of,
the parties to it and their respective heirs, legal representatives,
successors, and assigns.
14.8. Any controversy or claim arising out of, or relating to, this
Agreement, or the making, performance, or interpretation of it, will
be settled by binding arbitration in Los Angeles, California, under
the commercial arbitration rules of the American Arbitration
Association then existing, and judgment on the arbitration award may
be entered in any court having jurisdiction over the subject matter
of the controversy. Arbitrators will be persons experienced in
negotiating, making, and consummating acquisition agreements.
14.9. Each party's obligation under this Agreement is unique. If any party
should default in its obligations under this Agreement, both parties
acknowledge that it would be extremely impracticable to measure the
resulting damages; accordingly, the non-defaulting party or parties,
in addition to any other available rights or remedies, may xxx in
equity for specific performance, and the parties each expressly
waive the defense that a remedy in damages will be adequate. Despite
any breach or default by any of the parties of any of their
respective representations, warranties, covenants, or agreements
under this Agreement, if the purchase and sale contemplated by it is
consummated at the Closing, each of the parties waives any rights
that it may have to rescind this Agreement or the transaction
consummated by it; provided, however, that this waiver will not
affect any other rights or remedies available to the parties under
this Agreement or under the law.
14.10. If any legal action or any arbitration or other proceeding is
brought for the enforcement of this Agreement, or because of an
alleged dispute, breach, default, or misrepresentation in connection
with any of the provisions of this Agreement, the successful or
prevailing party or parties will be entitled to recover reasonable
attorney fees and other costs incurred in that action or proceeding,
in addition to any other relief to which it or they may be entitled.
14.11. All notices, requests, demands, and other communications under this
Agreement must be in writing and will be considered to have been
duly given on the date of service if served personally on the party
to whom notice is to be given, or on the second day after mailing if
mailed to the party to whom notice is to be given, by first class
mail, registered or certified, postage prepaid, and properly
addressed as follows: (i) To Seller at: The Xxxxxxxx Group, 0000
X.X. 00xx Xxxxxx, Xxxxx 0000, Xxxxxxxx Xxxx, XX 00000, and (ii) To
Buyer at: PracticeXpert, Inc., 0000 Xxxxxxxx Xxxx. #000, Xxxxxx
Xxxx, XX 00000. A party may change its address for purposes of this
Section by giving the other parties written notice of the new
address in the manner set forth above.
14.12. This agreement will be construed in accordance with, and governed
by, the laws of the State of California as applied to contracts that
are executed and performed entirely in California.
19
14.13. If any provision of this Agreement is held invalid or unenforceable
by any court of final jurisdiction, it is the intent of the parties
that all other provisions of this Agreement be construed to remain
fully valid, enforceable, and binding on the parties.
14.14. Either the Buyer or Seller hereto, may on the Closing Date may
terminate this Agreement without any liability to the other:
14.14.1. If any bona fide action or proceeding is pending against
any party on the Closing Date that could result in an
unfavorable judgment, decree, or order that would prevent or
make unlawful the performance of this Agreement or if any
agency of the federal or of any state government has objected
at or before the Closing Date to this acquisition or to any
other action required by or in connection with this Agreement;
14.14.2. If the legality and sufficiency of all steps taken and to
be taken by the parties and their Sellers in carrying out this
Agreement has not been approved by counsel as required by this
Agreement.
14.14.3. If either Buyer or Seller materially default in the due and
timely performance of any of their warranties or agreements
under this Agreement, the non-defaulting party or parties may
on the Closing Date give notice of termination of this
Agreement, in the manner provided herein. The notice will
specify with particularity the default or defaults on which
the notice is based. The termination will be effective five
days after the Closing Date, unless the specified default or
defaults have been cured on or before this effective date for
termination.
14.14.4. If this Agreement is terminated for any reason, it shall
become null and void and of no further force and effect;
provided however Seller shall be able to retain the Down
Payment as set forth in Section 3.1.1; provided however, and
notwithstanding the foregoing, in the event that this
Agreement is terminated due to Seller's failure to secure
consents required in Section 3.1.1 hereof, the Down Payment
shall be fully refunded to Buyer as of the effective date of
termination.
14.15. The representations, warranties and covenants of Seller and Buyer
20
contained in the Agreement Documents shall survive the consummation
of the transactions contemplated hereby. Any claims or causes of
action for breach or default, or for indemnification, under this
Agreement or any of the Agreement Documents, must be commenced by
either party hereto no later one year after such Party discovers or
reasonably should have discovered the existence of any such claim or
cause of action. For any action between the parties not otherwise
subsumed in the foregoing, such action may be commenced no later
than within the time permitted by the statute of limitations
provided by applicable Law. Notwithstanding anything to the contrary
in this Agreement, any act, omission, or misrepresentation which
does not materially result in any measurable damage or liability to
either party shall not be deemed or considered a breach or default
of this Agreement by either party.
14.16. Each party has been represented by its own counsel in connection
with the negotiation and preparation of this Agreement and,
consequently, each party hereby waives the application of any rule
of law that would otherwise be applicable in connection with the
interpretation of this Agreement, including, but not limited to, any
rule of law to the effect that any provision of this Agreement shall
be interpreted or construed against the party whose counsel drafted
that provision.
14.17. Each party represents and warrants to the other party that no
broker has been retained or otherwise employed to represent it in
this transaction which would entitle it to a commission.
IN WITNESS WHEREOF, the parties to this Agreement have duly executed it on the
day and year first above written.
"BUYER" "PARENT"
PRACTICEXPERT SERVICES, INC. PRACTICEXPERT, INC.
By: /S/ XXXXXXXX DOCTOR By: /S/ XXXXXXXX DOCTOR
------------------------------- ---------------------------
Xxxxxxxx Doctor, President Xxxxxxxx Doctor, President
"SELLER"
CANCER CARE NETWORK, INC.
By: /S/ XXXXXXX X. XXXXXXXX
-------------------------------
Xxxxxxx X. Xxxxxxxx, CEO
21
LIST OF EXHIBITS
Exhibit A Assets
Exhibit B Employment Contract
Exhibit C Financial Statements
LIST OF SCHEDULES:
Schedule 3.1.5.1 (Phone System)
Schedule 3.1.5.3 (Licenses)
Schedule 5.2.(Approvals Required For Transfer)
Schedule 5.6 (Assumed Liabilities)
Schedule 5.8 (Locations of Assets)
Schedule 5.13 (Liens/Leases re: Assets)
Schedule 5.15 (leases/requirement Contracts)
Schedule 5.18 (Assignments/ defaults caused by Transaction)
Schedule 6.9 (Buyer Required Consents)
Schedule 8.1 (Covered Employees and information relating thereto)
Schedule 8.6 (Buyer Assumed Liabilities)
Schedule 13.5 (Buyer Assumed Liabilities)
0
AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE OF ASSETS
This Amendment to Agreement For Purchase And Sale Of Assets ("Amendment")
is entered into as of the 27th day of February, 2004 by and between the
undersigned parties, who are designated as Seller and Buyer below.
WHEREAS, Seller and Buyer entered into an Agreement For Purchase And Sale
Of Assets ("Agreement") on the 2nd day of February, 2004; and
WHEREAS, Buyer was unable to pay the required Down Payment at execution of
the Agreement; and
WHEREAS, Seller and Buyer desire to amend said Agreement as set forth
herein.
WHEREUPON, the parties hereto agree as follows:
1. If Buyer does not deliver to Seller the Down Payment due under
Section 3.1 of said Agreement on or before the 10th day of March,
2004, Seller, in its sole and absolute discretion, may terminate
said Agreement.
2. If Buyer does not also submit to Seller on or before the 10th day of
March, 2004, such documentation, in form and substance satisfactory
to Seller, that demonstrates that Buyer has the financing in place
to close the transaction contemplated by said Agreement on or before
March 31, 2004, Seller, in its sole and absolute discretion, may
terminate said Agreement.
3. If Seller exercises its rights under either Paragraphs 1 or 2 above,
said Agreement shall be null and void and of no further force and
effect; provided however, any nondisclosure agreements executed
between the parties shall survive the termination of said Agreement.
4. The last sentence of Section 2 of said Agreement shall be deleted
and replaced with the following: "The Closing shall occur on or
before March 31, 2004 ("Closing Date")."
5. Except as amended herein, said Agreement remains in full force and
effect.
"Seller"
CANCER CARE NETWORK, INC.
By: /S/ XXXXXXX X. XXXXXXXX
---------------------------------
Xxxxxxx X. Xxxxxxxx, CEO
"Buyer"
PRACTICEXPERT SERVICES, INC. PRACTICEXPERT, INC.
By: /S/ XXXXXXXX DOCTOR By: /S/ XXXXXXXX DOCTOR
--------------------------------- ---------------------------------
Xxxxxxxx Doctor, President Xxxxxxxx Doctor, President
SECOND AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE OF ASSETS
This Second Amendment to Agreement For Purchase And Sale Of Assets
("Second Amendment") is entered into as of the 25th day of March, 2004 by and
between the undersigned parties, who are designated as Seller and Buyer below.
WHEREAS, Seller and Buyer entered into an Agreement For Purchase And Sale
Of Assets ("Agreement") on the 2nd day of February, 2004; and
WHEREAS, Seller and Buyer entered into an Amendment to said Agreement as
of February 24, 2004 ("Amendment"); and
WHEREAS, Buyer has now paid the Down Payment due pursuant to said
Agreement; and
WHEREAS, Buyer has not provided documentation required by Section 2 of
said Amendment and has not secured the financing needed to close the transaction
pursuant to the terms of said Agreement ("Transaction"); and
WHEREAS, Seller and Buyer desire to amend said Agreement as set forth
herein.
WHEREUPON, the parties hereto agree as follows:
1. Notwithstanding anything to the contrary in the Agreement, the
parties agree that said Down Payment is nonrefundable unless Seller
wrongfully fails to close said Transaction.
2. If Buyer does not submit to Seller on or before the 5th day of
April, 2004, such documentation, in form and substance satisfactory
to Seller, that demonstrates that Buyer has in escrow the four
million nine hundred thousand dollars ($4,900,000) needed to close
said Transaction pursuant to the terms of said Agreement, Seller, in
its sole and absolute discretion, may terminate said Agreement.
3. If Seller exercises its rights under Paragraph 2 above, said
Agreement shall be null and void and of no further force and effect;
provided however, (i) said Down Payment shall be retained by Seller,
and (ii) any nondisclosure agreements executed between the parties
shall survive the termination of said Agreement.
4. The last sentence of Section 2 of said Agreement shall be deleted
and replaced with the following: "The Closing shall occur
immediately following Buyer's filing of its Annual Report (10K);
provided however, such Closing shall not be later than April 17,
2004 ("Closing Date")."
5. Except as amended herein, said Agreement remains in full force and
effect.
"Seller"
CANCER CARE NETWORK, INC.
By: /S/ XXXXXXX X. XXXXXXXX
-----------------------------------
Xxxxxxx X. Xxxxxxxx, CEO
"Buyer"
PRACTICEXPERT SERVICES, INC. PRACTICEXPERT, INC.
By: /S/ XXXXXXXX DOCTOR By: /S/ XXXXXXXX DOCTOR
----------------------------------- --------------------------------
Xxxxxxxx Doctor, President Xxxxxxxx Doctor, President
THIRD AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE OF ASSETS
This Third Amendment to Agreement For Purchase And Sale Of Assets
("Third Amendment") is entered into as of the 5th day of April, 2004 by and
between the undersigned parties, who are designated as Seller and Buyer below.
WHEREAS, Seller and Buyer entered into an Agreement For Purchase And Sale
Of Assets ("Agreement") on the 2nd day of February, 2004; and
WHEREAS, Seller and Buyer entered into an Amendment to said Agreement as
of February 24, 2004 ("First Amendment"); and
WHEREAS, Seller and Buyer entered into a Second Amendment to said
Agreement as of March 25, 2004 ("Second Amendment");
WHEREAS, Buyer has now paid the Down Payment due pursuant to said
Agreement; and
WHEREAS, Buyer has now provided documentation required by Section 2 of
said First Amendment; but Buyer desires to change the manner in which the
Purchase Price is paid to Seller pursuant to the terms of said Agreement
("Transaction"); and
WHEREAS, Seller and Buyer desire to amend said Agreement as set forth
herein.
WHEREUPON, the parties hereto agree as follows:
1. Notwithstanding anything to the contrary in the Agreement or in any
Amendment thereto, the parties agree that said Down Payment is now
nonrefundable regardless of whether or not the Transaction closes or
the Fourth Amendment as hereinafter referenced is agreed upon by the
parties.
2. The parties agree that they will negotiate in good faith to enter
into a Fourth Amendment to said Agreement prior to the Closing Date,
which Fourth Amendment will address the following issues:
a. Buyer, in addition to the Down Payment, would deliver to
Seller $4,000,000 cash at the Closing of the Transaction.
b. Buyer would execute and deliver a nine hundred thousand dollar
($900,000) promissory note payable to Seller at Closing. Such
promissory note would have a payment term of ten (10) months
and would bear interest at the rate of 6.5% per annum.
Additionally such promissory note would be secured (i) by a
first security interest in the assets acquired by Buyer
pursuant to the Agreement, (ii) by a pledge of the stock of
the company used by Buyer to acquire the assets pursuant to
said Agreement and (iii) by a corporate guaranty of payment
and performance from PracticExpert, Inc. Such promissory note
and any and all of the documents setting forth or otherwise
creating the security for such promissory note shall contain
such terms, covenants and conditions as reasonably required by
Seller.
c. The billing contract to be delivered and executed as
referenced in Section 11.11 of said Agreement will be
structured to provide Seller with three hundred thousand
dollars in gross income per year for the first two years of
said billing contract. Such billing contract shall contain
appropriate adjustments for material changes in the activities
generating such gross income. Such billing contract shall
contain such terms, covenants and conditions as reasonably
required by Seller.
d. Buyer and Seller will amend the Agreement to reflect that the
common stock to be delivered to Seller pursuant to Section
3.1.3 of the Agreement will be priced at the average closing
price for a period of time to be agreed by the parties of not
less than the five trading days prior to Closing of the
Transaction and not more than thirty (30) trading days
preceding such Closing or on such other formula as agreed to
by the parties. Additionally the Agreement will be amended to
provide for a look back at the end of the twelfth month
following the Closing Date of the Transaction ("Look Back
Date") to determine if the average stock price of said common
stock for the thirty (30) trading days period prior to Look
Back Date is less than the price at which the common stock
delivered at Closing was valued. If such Look Back Date
average price is less that such Closing Date valuation price,
after adjusting for all stock splits during the period, if
any, Seller will be issued such additional common stock to
reflect the drop in the price of such stock ("Look Back
Provision"). For example, if the Closing Date valuation price
of the stock is $.50 per share and the Look Back Date average
price is $.40 cents per share, then an additional two hundred
and fifty thousand shares would then
be issued to Seller as of the Look Back Date. The Look Back
Provision agreement shall contain such additional terms,
covenants and conditions as reasonably required by Seller.
e. In the first sentence of Section 6 of the Agreement, the word
"Buyer" will be changed to "Seller".
f. At the end of Section 7.10(ii) the words "or an affiliated
company".
3. If the parties are unable to reach agreement on said Fourth Amendment by
the Closing Date, either party may terminate said Agreement. If a party
exercises its rights under this Section, said Agreement shall be null and
void and of no further force and effect; provided however, (i) said Down
Payment shall be retained by Seller, and (ii) any nondisclosure agreements
executed between the parties shall survive the termination of said
Agreement.
4. The last sentence of Section 2 of said Agreement shall be deleted and
replaced with the following: "The Closing shall occur immediately
following Buyer's filing of its Annual Report (10K); provided however,
such Closing shall not be later than April 17, 2004 ("Closing Date")."
5. This Third Amendment supercedes the prior two amendments and, except as
amended herein, said Agreement remains in full force and effect.
"Seller"
CANCER CARE NETWORK, INC.
By: /S/ XXXXXXX X. XXXXXXXX
-------------------------------------
Xxxxxxx X. Xxxxxxxx, CEO
"Buyer"
PRACTICEXPERT SERVICES, INC. PRACTICEXPERT, INC.
By: /S/ XXXXXXXX DOCTOR By: /S/ XXXXXXXX DOCTOR
---------------------------------- ----------------------------------
Xxxxxxxx Doctor, President Xxxxxxxx Doctor, President
SUPPLEMENT TO THIRD AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE OF ASSETS
This Supplement to the Third Amendment to Agreement For Purchase And Sale
Of Assets ("Supplemental Amendment") is entered into as of the 16th day of
April, 2004 by and between the undersigned parties, who are designated as Seller
and Buyer below.
WHEREAS, Seller and Buyer entered into an Agreement For Purchase And Sale
Of Assets ("Agreement") on the 2nd day of February, 2004; and
WHEREAS, Seller and Buyer entered into an Amendment to said Agreement as
of February 24, 2004 ("First Amendment"); and
WHEREAS, Seller and Buyer entered into a Second Amendment to said
Agreement as of March 25, 2004 ("Second Amendment");
WHEREAS, Seller and Buyer entered into a Third Amendment to said Agreement
as of April 5, 2004 ("Third Amendment"); and
WHEREAS, Seller and Buyer desire to supplement said Third Amendment as set
forth herein.
WHEREUPON, the parties hereto agree as follows:
1. The last sentence of Section 2 of said Agreement shall be deleted and
replaced with the following: "The Closing shall occur on or before April
28, 2004 ("Closing Date")."
"Seller"
CANCER CARE NETWORK, INC.
By: /S/ XXXXXXX X. XXXXXXXX
-----------------------------
Xxxxxxx X. Xxxxxxxx, CEO
"Buyer"
PRACTICEXPERT SERVICES, INC. PRACTICEXPERT, INC.
By: /S/ XXXXXXXX DOCTOR By: /S/ XXXXXXXX DOCTOR
---------------------------- ----------------------------
Xxxxxxxx Doctor, President Xxxxxxxx Doctor, President
5
FOURTH AMENDMENT TO AGREEMENT FOR PURCHASE AND SALE OF ASSETS
This Fourth Amendment to Agreement For Purchase And Sale Of Assets
("Fourth Amendment") is entered into as of the 28th day of April, 2004 by and
among the undersigned parties, who are designated as Seller and Buyer below.
WHEREAS, Seller and Buyer entered into an Agreement For Purchase And Sale
Of Assets ("Agreement") on the 2nd day of February, 2004; and
WHEREAS, Seller and Buyer entered into an Amendment to said Agreement as
of February 24, 2004 ("First Amendment"); and
WHEREAS, Seller and Buyer entered into a Second Amendment to said
Agreement as of March 25, 2004 ("Second Amendment"); and
WHEREAS, Seller and Buyer entered into a Third Amendment to said Agreement
as of April 5, 2004 ("Third Amendment"); and
WHEREAS, Seller and Buyer entered into a Supplement to the Third Amendment
dated the 16th day of April, 2004; and
WHEREAS, for the reasons set forth in the Third Amendment, the parties
have agreed to enter into this Fourth Amendment
WHEREUPON, the parties hereto agree as follows:
1. The introductory paragraph of the Agreement shall be amended to read
as follows:
"This Agreement For Purchase And Sale Of Assets ("Agreement")
is made as of February 2, 2004, at Toluca Lake, California, by
and among PRACTICEXPERT INC., a Nevada corporation ("Parent"),
its wholly owned subsidiary, PRACTICE XPERT SERVICES CORP.,
("Services"), a California corporation, both having their
principal office at 0000 Xxxxxxxx Xxxx. #000, Xxxxxx Xxxx, XX
00000 and its wholly owned subsidiary, PracticeXpert of
Oklahoma, Inc., an Oklahoma corporation, with it principal
place of business at 0000 X.X. 00xx Xxxxxx, Xxxxx 000,
Xxxxxxxx Xxxx, XX 00000 on the one hand (collectively
"Buyer"), and Cancer Care Network, Inc., an Oklahoma
corporation ("Seller")."
2. Section 3 of the Agreement shall be amended to read as follows:
"3. PURCHASE PRICE
3.1 The Purchase Price ("Purchase Price") will be five
million five hundred thousand dollars ($5,500,000.00)
and will be paid as follows:
3.1.1 ONE HUNDRED THOUSAND DOLLARS AND NO/100
(US$100,000.00) ("Down Payment") in immediately
available funds will be paid by Buyer to Seller upon
execution of this Agreement to ensure the good faith
performance of Buyer. Such Down Payment is
nonrefundable.
3.1.2 In addition to the Down Payment, Four million
dollars ($4,000,000.00) shall be paid to Seller in
immediately available funds at Closing.
3.1.3 In addition to the sum due at Closing pursuant to
Section 3.1.2, a Promissory Note in the amount of
nine hundred thousand dollars ($900,000) in the
form attached hereto as Exhibit D shall be fully
executed by Buyer and delivered to Seller at
Closing. In addition to such Promissory Note,
Buyer shall delivered fully executed copies of the
Stock Pledge Agreement attached hereto as Exhibit
E, the original stock certificates identified in
said Exhibit E, the Security Agreement attached
hereto as Exhibit F, the Stock Assignment and
Power of Attorney attached hereto as Exhibit H and
such other documents reasonably requested by
Seller in relation to such documents (collectively
the documents identified in this Section 3.1.3 are
referred to as the "Loan Documents).
3.1.4 The balance of the Purchase Price, to wit five
hundred thousand dollars ($500,000.00), shall be
paid by delivering to Seller at Closing shares of
Parent's Stock as set forth in Section 3 of this
Fourth Amendment. Such Parent Stock shall be
subject to all of the terms, covenants, and
restrictions set forth in said Section 3 of this
Fourth Amendment.
3.1.5 Subject to the provisions of Section 4.5 and any
other sections of this Agreement allowing a party
to terminate this Agreement, in the event that
Seller (i) fails to obtain any consents required
by the terms of any Client Contracts to make a
valid assignment of any of such Client Contracts
the parties agree to adjust the purchase price (as
hereinafter set forth) by a percentage determined
by dividing the net revenue earned by Seller for
services performed in 2003 on such Client
Contract(s) for which a consent for an assignment
was not obtained or for assignments not otherwise
made divided by the total net revenue received by
Seller from all Client Contracts for services
performed in 2003. Any such adjustment, at the
option of the Seller, may be made by reducing the
number of Parent's Stock to be delivered at
Closing.
2
3.1.6 Notwithstanding the foregoing, Buyer shall be given
allowance(s) at Closing in the following amounts:
3.1.6.1 An amount, not to exceed the amount shown on
Schedule 3.1.5.1, necessary to install purchase a
new Toshiba phone system by American Telecom with
services substantially the same as currently used
by Seller at its offices in Oklahoma City to allow
Buyer to purchase and install a phone system in
the space to be subleased from Seller by Buyer;
and
3.1.6.2 The amount of $36,247.50 for the assignment or
transfer of Seller's current license and server
license(s) with IBM and Mysis as shown on Schedule
3.1.5.3. 3.1.7 Prepaid items identified in
Schedule
3.1.7 will be prorated at Closing based on a 365 day
year."
3. The Stock referenced in Section 3.1.4 of the Agreement (as set forth
above in this Fourth Amendment) shall be subject to the following
terms, covenants, conditions and restrictions:
3.1. ISSUANCE OF PARENT STOCK TO SELLER. The balance of the
Purchase Price, to-wit five hundred thousand dollars
($500,000) shall be paid by delivering to Seller at Closing
shares of Parent's common stock, $.001 par value ("Parent
Stock"). The number of shares of Parent Common Stock to be
issued to Seller (the "Initial Stock") shall be determined by
dividing 500,000 by the average bid price for Parent Stock for
the twenty (20) trading days prior to April 20, 2004 and
rounded up to the nearest 100 shares.
3.2. ADJUSTMENTS TO SHARES OF PARENT STOCK ISSUED TO SELLER.
3.2.1. If, at the end of the twelve-month period following the
Closing Date (the "Anniversary Date"), the product of
(i) the higher of (a) the bid price per share of Parent
Stock for the twenty (20) trading days prior to the
fifth trading day preceding the Anniversary Date or (b)
the equivalent of thirty cents ($.30) per share prior to
any adjustments for changes in the number of issued and
outstanding shares of Parent Stock as the result of a
reclassification, subdivision, recapitalization,
combination, exchange or stock split (including reverse
stock split), (the "First Anniversary Bid Price") and
(ii) the number of Initial Shares is less than $500,000
(such product being the "First Anniversary Value"), then
the Parent shall issue additional shares of Parent Stock
(the "First Anniversary Additional Stock") as provided
in this subsection 3.2.1. The number of shares of First
Anniversary Additional Stock to be issued shall be equal
to the quotient of (x) the difference between $500,000
and the First Anniversary Value, divided by (y) the
First Anniversary Bid Price. If there is a change in the
number of issued and outstanding shares of Parent Stock
as the
3
result of a reclassification, subdivision,
recapitalization, combination, exchange, stock split
(including reverse stock split), stock dividend or
distribution or other similar transaction, the price set
forth in (b) above, the number of Initial Shares and the
number of shares of First Anniversary Additional Stock
shall be equitably adjusted to give effect to such
event. In the event of any merger, acquisition, sale of
substantially all of the assets or liquidation of the
Parent, the effective date of such event shall be deemed
to be the First Anniversary Date for the purposes of
this subsection 3.2.1.
3.2.2. If, at the end of the twenty-four month period
following the Closing Date (the "Second Anniversary
Date"), the product of (i) the higher of (a) the bid
price per share of Parent Stock for the twenty (20)
trading days prior to the fifth trading day preceding
the Second Anniversary Date or (b) the equivalent of
thirty cents ($.30) per share prior to any adjustments
for changes in the number of issued and outstanding
shares of Parent Stock as the result of a
reclassification, subdivision, recapitalization,
combination, exchange or stock split (including reverse
stock split) (the "Second Anniversary Bid Price") and
(ii) the number of Initial Shares (plus the number of
shares of First Anniversary Stock) is less than $500,000
(such product being the "Second Anniversary Value"),
then the Parent shall issue additional shares of Parent
Stock (the "Second Anniversary Additional Stock") as
provided in this subsection 3.2.2. The number of shares
of Second Anniversary Additional Stock to be issued
shall be equal to the quotient of (x) the difference
between $500,000 and the Second Anniversary Value,
divided by (y) the Second Anniversary Bid Price. If
there is a change in the number of issued and
outstanding shares of Parent Stock as the result of a
reclassification, subdivision, recapitalization,
combination, exchange, stock split (including reverse
stock split), stock dividend or distribution or other
similar transaction, the price set forth in (b) above,
the number of Initial Shares (plus the number of shares
of First Anniversary Stock) and the number of shares of
Second Anniversary Additional Stock shall be equitably
adjusted to give effect to such event. In the event of
any merger, acquisition, sale of substantially all of
the assets or liquidation of the Parent, after the First
Anniversary Date, but prior to the Second Anniversary
Date, the effective date of such event shall be deemed
to be the Second Anniversary Date for the purposes of
this subsection 3.2.2.
3.3. SELLER REPRESENTATIONS. Seller represents and warrants to the
Parent that:
3.3.1. it is an "accredited investor" within the meaning of
Rule 501 under the Securities Act and was not organized
for the specific purpose of acquiring the Shares;
3.3.2. it has sufficient knowledge and experience in investing
in companies similar to the Parent in terms of the
Parent's stage
4
of development so as to be able to evaluate the risks
and merits purchasing Parent Stock and it is able
financially to bear the risks thereof;
3.3.3. it has had an opportunity to discuss the Parent's
business, management and financial affairs with the
Parent's management;
3.3.4. the Shares being issued to it is being acquired for its
own account for the purpose of investment and not with a
view to or for sale in connection with any distribution
thereof; and
3.3.5. it understands that (i) the Shares have not been
registered under the Securities Act by reason of their
issuance in a transaction exempt from the registration
requirements of the Securities Act pursuant to Section
4(2) thereof, (ii) the Shares must be held indefinitely
unless a subsequent disposition thereof is registered
under the Securities Act or is exempt from such
registration, (iii) the Shares will bear a legend to
such effect and (iv) the Parent will make a notation on
its transfer books to such effect.
3.4. REQUEST FOR PIGGYBACK REGISTRATION. If at any time Parent
proposes to file a registration statement, other than pursuant
to a registration statement on Form S-4 or Form S-8 or similar
or successor forms, Parent shall promptly give written notice
of such proposed registration and the proposed method of sale
to Seller, which shall offer Seller the right to request
inclusion of the Initial Stock and the Additional Stock (if
any) (collectively, the "Shares") in the proposed registration
under the Securities Act of 1933, as amended (the "1933 Act")
for public sale in accordance with the method of disposition
specified in such notice. Seller shall have 10 days, or such
longer period as shall be set forth in the notice, from the
receipt of such notice to deliver to Parent a written request
specifying the number of Shares Seller intends to sell and
Seller's intended plan of disposition; provided, however,
Parent shall not be obligated to register, in the aggregate,
more than 50% of the Shares issued to Seller pursuant to
Sections 3.1 and 3.2 hereof. Upon receipt of a written request
pursuant to this Section, Parent shall use its best efforts to
effect the registration of the Shares to the extent required
to permit sale or disposition as set forth in the written
request.
3.4.1. REGISTRATION PROCEDURES. If and whenever the Parent is
required by the provisions of this Section 3.4 to use
its best efforts to effect the registration of any
Shares under the Securities Act, the Parent will, as
expeditiously as possible:
3.4.1.1. prepare and file with the Securities and
Exchange Commission (the "Commission") a
registration statement with respect to such
securities and use its best efforts to cause such
registration statement to become and remain
effective until the Seller is eligible to resell
all of the Shares in accordance with Section
3.4.1.2 hereof;
5
3.4.1.2. prepare and file with the Commission such amendments
and supplements to such registration statement and the
prospectus used in connection therewith as may be
necessary to keep such registration statement effective
for nine (9) months and comply with the provisions of
the Securities Act with respect to the disposition of
all Shares covered by such registration statement in
accordance with Seller's intended method of disposition
set forth in such registration statement for such
period;
3.4.1.3. furnish to Seller such number of copies of the
registration statement and the prospectus included
therein (including each preliminary prospectus) as such
persons reasonably may request in order to facilitate
the public sale or other disposition of the Shares
covered by such registration statement;
3.4.1.4. use its best efforts to register or qualify the
Shares covered by such registration statement under the
securities or "blue sky" laws of such jurisdictions as
Seller reasonably shall request; provided however, that
Parent shall not be required to consent to general
service of process, qualify to do business as a foreign
corporation where it would not be otherwise required to
qualify, or submit to liability for state or local taxes
where it is not liable for such taxes;
3.4.1.5. use its best efforts to list the Shares covered by
such registration statement with any securities exchange
on which the Parent Stock is then listed;
3.4.1.6. immediately notify Seller at any time when a
prospectus relating thereto is required to be delivered
under the Securities Act within the appropriate period
mentioned in Section 3.4.1.2 hereof, of the happening of
any event of which the Parent has knowledge as a result
of which the prospectus contained in such registration
statement, as then in effect, includes an untrue
statement of a material fact or omits to state a
material fact required to be stated therein or necessary
to make the statements therein not misleading in light
of the circumstances then existing;
3.4.1.7. make available for inspection by Seller, and any
attorney, accountant or other agent retained by Seller,
all financial and other records, pertinent corporate
documents and properties of the Parent, and cause the
Parent's officers, directors and employees to supply all
information reasonably requested by Seller, and any
attorney, accountant or other agent retained by Seller
in connection with such registration statement; and
3.4.1.8. in connection with each registration hereunder,
Seller will furnish to the Parent in writing such
information with respect to
6
it and the proposed distribution by it as Parent may
reasonably request. The obligations of Seller set forth
in this subsection 3.4.1.8 shall be a condition
precedent to Parent's obligations to register the Shares
as provided for herein.
3.4.2. EXPENSES. All expenses incurred by the Parent in complying
with Section 3.4, including, without limitation, all
registration and filing fees, printing expenses, fees and
disbursements of counsel and independent public accountants
for the Parent, fees and expenses (including counsel fees)
incurred in connection with complying with state securities or
"blue sky" laws, fees of the National Association of
Securities Dealers, Inc., and fees of transfer agents and
registrars, but excluding any Selling Expenses, are called
"Registration Expenses." All underwriting discounts and
selling commissions covered by registrations effected pursuant
to this Section 3.4 hereof are called "Selling Expenses".
3.4.2.1. The Parent will pay all Registration Expenses in connection
with each registration statement under Section 3.4. All
Selling Expenses in connection with each registration
statement under Section 3.4 shall be borne by Seller in
proportion to the number of Shares sold by it to the number of
shares of Parent Stock sold by participating sellers other
than the Parent (except to the extent the Parent shall be a
seller in such offering) as they may agree.
3.4.3. INDEMNIFICATION AND CONTRIBUTION. (A) In the event of a
registration of any of the Shares under the Securities Act
pursuant to Section 3.4, the Parent will indemnify and hold
harmless Seller, and each other person, if any, who controls
Seller or such underwriter within the meaning of the
Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which Seller, underwriter or
controlling person may become subject under the Securities Act
or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue
statement of any material fact contained in any registration
statement under which such Shares was registered under the
Securities Act pursuant to Section 3.4, any preliminary
prospectus or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to
make the statements therein not misleading, and will reimburse
Seller and each such controlling person for any legal or other
expenses reasonably incurred by them in connection with
investigating or defending any such loss,
7
claim, damage, liability or action, provided however, that the
indemnity contained in this subsection 3.4.3 shall not apply
to amounts paid in settlement of any such loss, claim, damage
or liability if settlement is effected without the consent of
Parent (which consent shall not unreasonably be withheld); and
provided, however, that the Parent will not be liable in any
such case if and to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged
omission so made in conformity with information furnished by
Seller, any such underwriter or any such controlling person in
writing specifically for use in the offering of securities of
Parent.
3.4.3.1. In the event of a registration of any of the Shares under
the Securities Act pursuant to Section 3.4, Seller will
indemnify and hold harmless the Parent, each person, if any,
who controls the Parent within the meaning of the Securities
Act, each officer of the Parent who signs the registration
statement , each director of the Parent and underwriter within
the meaning of the Securities Act, against all losses, claims,
damages or liabilities, joint or several, to which the Parent
or such officer, director, underwriter or controlling person
may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material
fact contained in the registration statement under which such
Shares was registered under the Securities Act pursuant to
Section 3.4, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof, or
arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and will reimburse the Parent and each such
officer, director, underwriter and controlling person for any
legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss,
claim, damage, liability or action, provided, however, that
Seller will be liable hereunder in any such case if and only
to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in
reliance upon and in conformity with information pertaining to
Seller, as a seller, furnished in writing to the Parent by
Seller specifically for use in the offering of securities of
Parent, and provided, further, however, that the liability of
Seller hereunder shall not in any event to exceed the proceeds
received by Seller from the sale of Shares covered by such
registration statement.
3.4.3.2. Promptly after receipt by the indemnified party of notice
of the commencement of any action which may give rise to a
claim for indemnification hereunder, such indemnified party
shall, if a claim in respect thereof is to be made against the
indemnifying party hereunder, notify the indemnifying party in
writing of the commencement thereof and generally summarize
such action, but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may
have to such indemnified party other than under this Section
3.4 and shall only relieve it from any
8
liability which it may have to such indemnified party under
this Section 3.4 if and to the extent the indemnifying party
is prejudiced by such omission. In case any such action 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 participate in and, to
the extent it shall wish, to assume and undertake the defense
thereof with counsel satisfactory to such indemnifying party,
and, after notice from the indemnifying party to such
indemnified party of its election so to assume and undertake
the defense thereof, the indemnifying party shall not be
liable to such indemnified party under this Section 3.4 for
any legal expenses subsequently incurred by such indemnified
party in connection with the defense thereof other than
reasonable costs of investigation and of liaison with counsel
so selected, provided, however, that, if the defendants in any
such action include both the indemnified party and the
indemnifying party and the indemnified party shall have
reasonably concluded that there may be reasonable defenses
available to it which are different from or additional to
those available to the indemnifying party or if the interests
of the indemnified party reasonably may be deemed to conflict
with the interests of the indemnifying party, the indemnified
party shall have the right to select a separate counsel
(reasonably satisfactory to the indemnifying party) and to
assume such legal defenses and otherwise to participate in the
defense of such action, with the expenses and fees of such
separate counsel to be reimbursed by the indemnifying party as
incurred.
3.4.3.3. In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which
either (i) Seller, or any controlling person thereof, makes a
claim for indemnification pursuant to this Section 3.4 but it
is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration
of time to appeal or the denial of the last right of appeal)
that such indemnification may not be enforced in such case
notwithstanding the fact that this Section 3.4 provides for
indemnification in such case, or (ii) contribution under the
Securities Act may be required on the part of Seller or any
such controlling person in circumstances for which
indemnification is provided under this Section 3.4; then, and
in each such case, the Parent and Seller will contribute to
the aggregate losses, claims, damages or liabilities to which
they may be subject (after contribution from others) in such
proportion as is appropriate to reflect the relative fault of
the indemnifying party and indemnified party in connection
with the statements or omissions which result in such losses,
claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative fault of such
indemnifying party and indemnified party shall be determined
by reference to, among other things, whether the untrue or
alleged untrue statement of
9
a material fact or the omission or alleged omission to state a
material fact relates to information supplied by such
indemnifying party or indemnified party and the parties'
relative intent, knowledge, access to information supplied by
such indemnifying party or indemnified party and opportunity
to correct or prevent such statement or omission; provided,
however, that, in any such case, (A) Seller will not be
required to contribute any amount in excess of the public
offering price of all such Shares offered by it pursuant to
such registration statement; and (B) no person or entity
guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of
such fraudulent misrepresentation.
3.5. The obligations of Buyer and each of them under this Section shall
survive the Closing of the Agreement.
4. In the third line of Section 4.4 of the Agreement, the words "Exhibit 2"
shall be changed to "Exhibit I".
5. Section 4.6 of the Agreement shall be deleted.
6. Section 4.8 of the Agreement shall be deleted.
7. The parties agree as follows:
7.1. Seller shall continue to employ only the employees listed on
Schedule 8.1 ("Covered Employees") and leave eligible for the
benefit plans of Seller (as may be amended from time to time by
Seller) through not later than the 30th day of June, 2004 ("Covered
Employee Termination Date"). Buyer understands that Seller
self-insures it employee health plan. From the date of Closing
through such Covered Employee Termination Date ("Employee Leasing
Term"), all such Covered Employees shall be deemed employees leased
to PracticeXpert of Oklahoma, Inc. (`PracticeXpert-OK"). Effective
as of the earlier of (i) Covered Employee Termination Date, (ii)
Buyer Breach Date (as identified below) or (iii) such earlier date
as agreed by Seller and PracticeXpert-OK, Seller shall terminate all
of said Covered Employees. Seller shall not have any obligation to
employees hired by Buyer or any of them after Closing. During the
Employee Leasing Term, Buyer assumes full and complete
responsibility for compliance with all applicable federal, state or
local laws rules or regulations covering or applying to said Covered
Employees and shall hold Seller harmless therefrom.
7.2. During such Employee Leasing Term, PracticeXpert-OK shall submit to
Seller its payroll data in a form, at a time and by the exact method
specified by Seller or it payroll processing company. Because the
accuracy of the payroll is limited by the data submitted by
PracticeXpert-OK, Seller is not responsible for errors, wage and
hour violation, employment discrimination or other employment
policies that may violate applicable local, state or federal law or
rules and regulations enacted in
10
relation thereto, or other employment policies that may violate the
law. It is the sole responsibility of PracticeXpert-OK to review the
processed payroll information and to promptly identify any errors.
If the data submitted by PracticeXpert-OK is incorrect, incomplete
or not in proper form, then PracticeXpert-OK agrees to pay Seller
for any costs, time or expenses incurred by Seller to correct the
same.
7.3. During such Leasing Term, Buyer shall electronically transfer to
Sellers designated bank account at least seventy-two hours prior to
the applicable payroll date for the Covered Employees such sums in
immediately available funds as are necessary to adequately fund
PracticeXpert-OK's for the Covered Employees, including taxes
(including without limiting the generality of the foregoing,
employer and Covered Employee FICA, FUTA, SUTA), escrows, benefit
plans, withholding, adjustments, or other associated fees and
charges. Should any transfer or other tender of funds to Seller be
returned for any reason whatsoever or be inadequate to fund all of
the above ("Buyer Breach Date"), Seller may immediately terminate
its obligations under this Section of this Fourth Amendment without
notice to Buyer and without any cure rights of Buyer.
7.4. In addition to the sums due Seller under Section 7.3 above, Seller,
to the extent not paid pursuant to said Section 7.3 above, shall
also be reimbursed by for the actual amount of wages, salaries,
overtime, taxes (including without limiting the generality of the
foregoing, employer and Covered Employee FICA, FUTA, SUTA),
insurance (including without limitation the cost of workers
compensation and fidelity bonds or other insurance) and benefits
(including without limitation any insurance premiums paid on behalf
of any Covered Employee, health or other benefits paid on behalf of
any Covered Employee, and any employer paid pension, 401k or other
similar plans and any third party costs for managing such plans) and
any other costs incurred by Seller and paid by Seller to, for or on
behalf of the Covered Employees provided by Seller pursuant to this
Agreement. Seller shall also be paid an administration fee of two
hundred and fifty dollars ($250) per each payroll period during the
Employee Leasing Term. Without limiting the rights of Seller under
said Section 7.3, if the amount due under this Section is not paid
within five (5) days after receipt of written notice from Seller,
Seller may immediately terminate its obligations under Section 7 of
this Fourth Amendment without further notice to Buyer and without
any cure rights of Buyer.
7.5. Any sum due pursuant to this Section 7 shall draw interest at 6.5%
from the due date until paid in full.
7.6. Buyer and each of them agree to protect, indemnify, defend and hold
Seller harmless against all loss, cost, damages, judgments,
administrative actions, attorney fees, court costs or expense which
Seller may incur or sustain in connection with or in consequence (i)
as a result of any failure of the Buyer to pay sums due pursuant to
Section 7 of this Fourth Amendment, (ii) as a result of any other
breach by Buyer of its obligations under Section 7 of this Fourth
Amendment, as a result of a claim of occupational injury relation to
Covered Employees arising in any manner out of or in any way
connected with or a result of performance of this Agreement, or
breach thereof, or (iii) as a result of any other intentional or
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negligent act or omission on the part of Buyer or any of them or
their respective employees, agents and representatives (including
without limiting the generality of the foregoing, the Covered
Employees), no matter by whom or on whose behalf such claim, demand,
suit, claim or action, as the case may be, may be asserted or
brought.
7.7. The obligations of Buyer and each of them under this Section 7 shall
survive the Closing of the Agreement.
8. Notwithstanding anything to the contrary (i) in the Agreement or in any
Amendment thereto or (ii) in any written or oral disclosures made or
delivered by or on behalf of Seller to Buyer or any of them or their
representatives at any time prior to the Closing of this Agreement, Buyer
and each of them agree and acknowledge that the only financial statements
or related financial documents of any kind or nature upon which they have
relied or are relying on in regards to the execution or Closing of the
Agreement or of the transactions contemplated by said Agreement are the
financial statements and related financial documents attached as Exhibit C
attached hereto. Buyer and each of them waive any claim or cause of action
of any kind or nature against Seller or its shareholder or their
respective agents, employees, attorneys, contractors or representatives
arising out of or relating to any financial statements or related
financial documents or information other than those set forth on Exhibit C
to the Agreement, which may have been delivered or disclosed to Buyer or
any of them or their representatives at any time prior to the Closing of
this Agreement and agree to indemnify, defend and hold Seller, its
shareholder and their respective officers, employees, attorneys,
contractors and representatives harmless from any claim made by Buyer or
any of them or by any third person(s) relating to any such other financial
statements or related financial documents.
9. Section 5.5.2 is deleted.
10. Section 10.2.1 is amended to read as follows: "A certificate from Seller
dated as of Closing that between the execution of this Agreement and
Closing that Seller has not sustained any insured or uninsured loss or
damage that would have a Materially Adverse Effect on the Assets."
11. The first sentence of Section 6 of the Agreement shall be amended to read
as follows: "Buyer and each of them represent and warrant to Seller that:"
12. Section 6.1 of the Agreement shall be amended to read as follows: "Buyers
are each corporations duly organized, existing, and in good standing under
the laws of the state where they are incorporated as identified in the
introductory section of this Agreement,"
13. In the fifth line of Section 7.10 of the Agreement, after the word
"Seller" add the words "or its parent company or any of their respective
subsidiary companies (collectively "Seller" for purposes of this Section
7.10."
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14. Add the following as Section 7.10(iv): "or the billing services provided
by Seller pursuant to the Radiation Therapy Physicians, Inc. Billing
Agreement of Seller."
15. Section 8.1 of the Agreement is deleted.
16. The following is added to the third line of Section 8.2 of the Agreement
after the words "Closing Date" " "and all of the accrued paid time off or
vacation pay accrued between the Closing and the Covered Employee
Termination Date set forth in Section 7 above of the Fourth Amendment to
this Agreement."
17. Sections 8.3 and 8.4 of the Agreement are deleted.
18. The parties agree as follows:
18.1. Notwithstanding anything to the contrary in the Agreement, it is
agreed and understood, regardless of the Closing Date, that through
the end of April, 2004 Seller, with the assistance of Buyer, will
continue to service the Client Contracts so that the books for such
Client Contracts can be closed out as of the end of April, 2004 on
Seller's books. Any payable incurred for or in relation to said
Client Contracts on or before April 30, 2004 shall, subject to the
terms of Section 18 of this Fourth Amendment, shall remain the
obligation of Seller. Moreover, subject to the terms of said Section
8, any income received, due or otherwise accrued from said Client
Contracts shall be the property of Seller. To the extent that Buyer
receives any such income after Closing it shall account to Seller
for the same and, subject to the terms and conditions of said
Section 18, shall promptly deliver the same to Seller. It is agreed
and understood that any income derived from the Client Contracts for
services rendered on or after May 1, 2004, shall belong to Buyer. It
is further agreed and understood that any payables incurred on or
after May 1, in relation to the Client Contracts shall be the
responsibility of Buyer. Seller covenants and agrees to handle and
maintain the Client Contracts and its Clients from the Closing Date
through the end of April, 2004 in conformance with its customary and
usual business practices consistent with its past practices and to
recognize any revenues and expenses associated with such Client
Contracts consistent with its past practices.
18.2. Notwithstanding anything to the contrary in the Agreement or in any
amendments thereto, including, without limiting the generality of
the foregoing, any of the Exhibits or Schedules thereto, all amounts
received from billing for Client Contracts (other than the
Cookeville Contracts identified in Section 18.2 hereof) as a result
of services rendered through and including April 30, 2004, whether
the services were rendered by Seller or Buyer, shall be retained by
Seller.
18.3. Additionally, all amounts received or due to Seller or Buyer for
services rendered on or before April 30, 2004 in relation to the
Client Contracts for Xx. Xxxxxxx and Dr. Sydris in Cookeville,
Tennessee ("Cookeville Contracts") shall be retained by or delivered
to Seller, as the
13
case may be, to the extent that drug purchases and supplies
purchased on or before Closing Date for the Cookeville Contracts
("Cookeville Purchases") are unpaid as of Closing Date. Seller shall
keep Buyer advised of the status of the pay-off of such Cookeville
Purchases. Once such Cookeville Purchases are paid off, any
additional sums due Buyer or Seller for such services rendered shall
be the property of Buyer.
18.4. Seller may audit Buyer's books to insure compliance with this
Section 18.
18.5. The obligations of Buyer and each of them under this Section 18
shall survive the Closing of the Agreement.
19. In the first line of Section 11.5 of the Agreement, the words "and holders
of a majority of he outstanding stock" shall be deleted.
20. Section 13.3 should be renumbered as Section 7.11 and shall be amended to
read as follows: "Except to the extent that the information (i) is or
becomes generally available to and known by the public (other than as a
result of unpermitted disclosure directly or indirectly by Seller, or its
affiliates, advisors, officers, employees, directors or representatives,
(ii) has been previously disclosed by Seller or its employees, officers or
agents in the course of its business, (iii) is disclosed pursuant to a
valid court order of a court of competent jurisdiction, a valid
administrative subpoena or a lawful request for information by an
administrative or regulatory agency and (iv) except to the extent used by
Seller in conjunction with providing the services allowed pursuant to
Section 7.10 or (v) except as may be required by law, Seller agrees not to
divulge, communicate, use to the detriment of Buyer or for the benefit of
any other person or persons, or misuse in any way, any confidential
information or trade secrets of Seller, including personnel information,
secret processes, know-how, customer lists, recipes, formulas, or other
technical data".
21. Section 13.4 should be renumbered as Section 11.12 and shall be amended to
read as follows: "Agreement by Buyer to assume Seller's obligations under
the Client Contracts in the form set forth on Exhibit J hereto.
22. Section 13.5 should be renumbered as Section 11.13 and shall be amended to
read as follows: "Agreement by Buyer to assume the accounts payable set
forth on Schedule 11.13".
23. In the fourth line of Section 13.6 after the word "Agreement", add the
following "any amendment(s) thereto, or any documents executed by the
Buyer in conjunction with the Closing of this Agreement, including without
limiting the generality of the foregoing, the Loan Documents.
24. The words "Except for claims seeking injunctive relief," shall be added to
the beginning of Section 14.8 and in said Section 14.8, the words "Los
Angeles, California" shall be deleted and replaced with the words
"Oklahoma City, Oklahoma."
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25. Section 14.12 shall be amended to read as follows: This Agreement shall be
construed and enforced in accordance with, and governed by, the laws of
the state of Oklahoma, without regard to its conflict of law rules. Any
action or claim brought by Buyer or any of them regarding this Agreement
or any of the agreements executed and deliver in conjunction with the
Closing of the Agreement, including without limiting the generality of the
foregoing, the Loan Documents, may only be brought in a court of competent
jurisdiction in Oklahoma County, Oklahoma."
26. Section 14.14.4 shall be deleted and replaced with the following: "If this
Agreement is terminated for any reason, it shall become null and void and
of no further force and effect; provided however Seller shall be able to
retain the Down Payment referenced in Section 3 of the Agreement."
27. In the first line of Section 14.15 after the word "covenants" insert ("but
only to the extent that any such covenant requires performance by
covenanter after Closing in relation to any such covenant)".
28. The following sentence shall be added to the end of Section 1.3:
"Notwithstanding anything to the contrary in this Agreement, the Client
Contracts do not include the management service agreements and related
billing agreements which Seller has with the medical practices for or
relating to the locations in the following Oklahoma cities, TO WIT,
Midwest City, Oklahoma City, Edmond, Clinton, Ponca City and Chickasha."
29. The List of Exhibits and Schedules attached to the Agreement shall be
replaced by the attached list of Exhibits and Schedules.
30. It is agreed and understood that any reference to the term "Agreement" in
the Agreement For Purchase And Sale Of Assets dated the 2nd day of
February, 2004 or in any Amendment thereto shall refer to such Agreement
For Purchase And Sale Of Assets, as amended. Capitalized terms used in the
Agreement shall be deemed to have the same meaning in any Amendment
thereto unless otherwise indicated in such Amendment.
31. It is agreed and understood that this Agreement and any of the other
documents to be executed and delivered pursuant to this Agreement,
including without limiting the generality of the foregoing, the Loan
Documents, may be executed in one or more counterparts, each of which
shall, for all purposes of such applicable documents be e deemed an
original, but all of which shall constitute one and the same agreement.
The parties also agree that a facsimile signature shall be binding the
same as an
15
original signature; provided however, on demand a party shall produce such
original signature pages corresponding to a previously delivered facsimile
signature.
"Seller"
CANCER CARE NETWORK, INC.
By: /S/ XXXXXXX X. XXXXXXXX
---------------------------------
Xxxxxxx X. Xxxxxxxx, CEO
"Buyer"
PRACTICE XPERT SERVICES Corp. PRACTICEXPERT, INC.
By: /S/ XXXXXXXX DOCTOR By: /S/ XXXXXXXX DOCTOR
--------------------------------- -------------------------------
Xxxxxxxx Doctor, President/CEO Xxxxxxxx Doctor, President/CEO
PRACTICEXPERT OF OKLAHOMA, INC.
By: /S/ XXXXXXXX DOCTOR
---------------------------------
Xxxxxxxx Doctor, CEO
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