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EXHIBIT 10.3
AMENDMENT TO AMENDED AND RESTATED COMMON STOCK AND WARRANT AGREEMENT
This AMENDMENT, dated as of January 25, 2001 (this "AMENDMENT"),
amends the Amended and Restated Common Stock and Warrant Agreement made and
entered into as of March 30, 2000, and amended and restated as of May 24, 2000
(the "AGREEMENT"), by and between Xxxxxxxx.xxx, Inc., a Delaware corporation
("PARENT"), and University HealthSystem Consortium, an Illinois corporation
("UHC").
RECITALS
WHEREAS, Parent, Novation, LLC, a Delaware limited liability company
("NOVATION"), VHA Inc., a Delaware corporation ("VHA"), UHC, and Healthcare
Purchasing Partners International, LLC, a Delaware limited liability company
("HPPI"), have entered into that certain Outsourcing and Operating Agreement,
dated as of March 30, 2000, and amended and restated as of May 24, 2000 and
January 25, 2001 (the "OUTSOURCING AGREEMENT"). Capitalized terms in this
Amendment which are not otherwise defined in this Amendment shall have the
meanings assigned to them in the Agreement, or if not defined therein, in the
Outsourcing Agreement.
WHEREAS, in consideration of the services rendered and to be
rendered by UHC pursuant to the Outsourcing Agreement and UHC's fulfillment of
its duties and obligations thereunder, Parent issued to UHC (i) 11,279,150
shares (such shares, the "SHARES") of Parent common stock, par value $0.001 per
share ("COMMON STOCK"), and (ii) a warrant to purchase up to 7,519,436 shares of
Common Stock (the "WARRANT").
WHEREAS, on December 19, 2000, UHC exercised its right to purchase
1,879,859 shares of Common Stock subject to the Warrant, representing all of the
vested and exercisable shares of Common Stock available for purchase pursuant to
Sections 1.1.2 (1) and 1.1.3 (1) of the Warrant, leaving a balance of 5,639,577
shares of Common Stock that remain subject to the Warrant.
WHEREAS, Parent and UHC mutually desire to cancel the Warrant and
substitute for the remaining shares subject to potential vesting under the
Warrant, 5,639,577 shares of restricted Common Stock, which shares shall be
subject to forfeiture by UHC to Parent, in each case, subject to the terms and
conditions set forth in this Amendment.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements set forth in this
Amendment, the Agreement and the Outsourcing Agreement, the parties agree as
follows:
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ARTICLE I
SUBSTITUTION OF RESTRICTED SHARES FOR WARRANT
1.1 Authorization; Closing. As of the consummation of the transactions
substituting Restricted Shares (as defined below) for the Warrant (the
"SUBSTITUTION CLOSING"), Parent will have authorized the issuance to UHC of
4,229,682 shares of restricted Common Stock (the "TRANCHE A SHARES") and
1,409,895 shares of restricted Common Stock (the "TRANCHE B SHARES", and
collectively with the Tranche A Shares, the "RESTRICTED SHARES"). The
Substitution Closing will take place at the offices of Fenwick & West LLP, Two
Palo Alto Square, Palo Alto, California, on January 25, 2001, or such other time
and date as mutually agreed upon by the parties.
1.2 Cancellation and Substitution of Warrant and Issuance of Restricted
Shares.
(a) At the Substitution Closing, UHC shall return to Parent for
cancellation, and Parent shall cancel, the Warrant. On and after the
Substitution Closing, the Warrant shall, in all respects, be cancelled,
terminated and of no further force or effect.
(b) At the Substitution Closing, Parent shall issue to UHC
4,229,682 Tranche A Shares and 1,409,895 Tranche B Shares. UHC's right to fully
enjoy beneficial ownership of the Restricted Shares shall be subject to a
substantial risk of forfeiture by UHC to Parent pursuant to the terms and to the
extent set forth in this Article I (the "FORFEITURE RISK"). Restricted Shares
that become vested pursuant to this Article I and are no longer subject to the
Forfeiture Risk are referred to as "VESTED SHARES."
1.3 Definitions.
(a) "CUMULATIVE SIGNED PURCHASING VOLUME" means, as of any
Determination Date (as defined in Sections 1.4(a), (b) and (c) of this
Amendment), the sum of (x) the cumulative dollar volume of purchases by
Healthcare Organizations that are members or patrons of UHC (calculated, for
each such Healthcare Organization, by multiplying (A) the amount of Novation
contract purchases (as reported in the SRIS system maintained for Novation's
benefit) by such Healthcare Organization during the most recent complete
calendar year ending prior to the first Determination Date on or prior to which
such Healthcare Organization Signed-Up with Parent by (B) 2.4 (the "BASE
AMOUNT")) and that Signed-Up with Parent on or prior to such Determination Date,
plus (y) 19.6% of the cumulative dollar volume of purchases by Healthcare
Organizations that are members or patrons of HPPI (using, for each such
Healthcare Organization, its Base Amount) and that Signed-Up with Parent on or
prior to such Determination Date, provided that (i) for purposes of computing
the first Base Amount for each Healthcare Organization, such Base Amount will be
increased by 3.625% and (ii) in addition to the increase in the Base Amount for
any Healthcare Organization pursuant to the preceding clause (i), the Base
Amount for each Healthcare Organization shall also be increased annually by
7.25% when computing Cumulative Signed Purchasing Volume for Determination Dates
which are subsequent to the first Determination Date on or prior to which a
particular Healthcare Organization Signed-Up with Parent. For purposes of
clarity, the parties agree that once a Healthcare Organization is deemed to have
"Signed-Up" with Parent, its Cumulative Signed Purchasing Volume, as computed
and increased under the formula set forth in this definition,
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shall be included in the computation of Cumulative Signed Purchasing Volume for
all Determination Dates arising on or after the date such Healthcare
Organization Signed-Up with Parent, whether or not such Healthcare Organization
continues to do business with Parent.
(b) "HEALTHCARE ORGANIZATION" shall mean any facility providing
health care services.
(c) "PREFERRED PROVIDER" means the Healthcare Organization agrees
to use the Parent internet-based system for at least 50% of its internet-based
purchases of Novation contracted products.
(d) "SIGNED-UP" means, with respect to any Healthcare
Organization, that such Healthcare Organization and Parent have entered into a
written agreement, arrangement or understanding for Parent to be the Preferred
Provider of an Internet-based system for the acquisition of Novation contracted
products by such Healthcare Organization.
1.4 Vesting of Tranche A Shares.
(a) 1,409,894 Tranche A Shares shall become Vested Shares on June
30, 2002 (the "FIRST DETERMINATION DATE") if Cumulative Signed Purchasing Volume
as of the First Determination Date is at least $1,520 million (the "FIRST
TRANCHE A TARGET AMOUNT").
(b) 1,409,894 Tranche A Shares shall become Vested Shares on June
30, 2003 (the "SECOND DETERMINATION DATE") if Cumulative Signed Purchasing
Volume as of the Second Determination Date is at least $2,347 million (the
"SECOND TRANCHE A TARGET AMOUNT").
(c) 1,409,894 Tranche A Shares shall become Vested Shares on June
30, 2004 (the "THIRD DETERMINATION DATE") if Cumulative Signed Purchasing Volume
as of the Third Determination Date is at least $3,231 million (the "THIRD
TRANCHE A TARGET AMOUNT").
(d) In the event the Tranche A Target Amount of Cumulative Signed
Purchasing Volume specified in any of Section 1.4 paragraphs (a), (b) or (c)
above is not achieved as of the particular Determination Date specified in such
paragraph (such shortfall below a particular Tranche A Target Amount being
referred to as a "TRANCHE A SHORTFALL AMOUNT"), then the number of Tranche A
Shares which shall become Vested Shares at a particular Determination Date
pursuant to Section 1.4 paragraphs (a), (b), or (c) above shall equal the
product of 1,409,894 and a fraction, the numerator of which is the Cumulative
Signed Purchasing Volume as of the Determination Date in question and the
denominator of which is the Tranche A Target Amount for the Determination Date
in question. By way of example, using the formula in the preceding sentence, if
as of June 30, 2002, Cumulative Signed Purchasing Volume is $1,000 million,
927,562 Tranche A Shares shall become Vested Shares:
1,409,894 x 1,000 = 927,562 Vested Shares
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1,520
If there is a Tranche A Shortfall Amount relating to a particular Determination
Date, then the number of Tranche A Shares which will not vest due to such
shortfall shall equal
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1,409,894 minus the number of Tranche A Shares which became Vested Shares on
such Determination Date (the "TRANCHE A SHORTFALL SHARES"). Using the facts set
forth in the preceding example, if as of June 30, 2002, Cumulative Signed
Purchasing Volume is $1,000 million, and 927,562 Tranche A Shares become Vested
Shares, then 482,332 Tranche A Shares shall be deemed Tranche A Shortfall Shares
as of the First Determination Date:
1,409,894 - 927,562 = 482,332 Tranche A Shortfall Shares
A Determination Date as of which there is a Tranche A Shortfall
Amount is referred to as a "TRANCHE A SHORTFALL DETERMINATION DATE." A
Determination Date which occurs immediately after a Tranche A Shortfall
Determination Date is referred to as a "TRANCHE A CATCH UP DETERMINATION DATE."
If as of a Tranche A Catch Up Determination Date, the applicable Tranche A
Target Amount for such Tranche A Catch Up Determination Date is met or exceeded,
then the Tranche A Shortfall Shares which did not vest on such Tranche A
Shortfall Determination Date shall immediately become Vested Shares on the
Tranche A Catch Up Determination Date, it being agreed that if the Tranche A
Target Amount relating to such Tranche A Catch Up Determination Date is not met,
such Tranche A Shortfall Shares shall never become vested. By way of example, if
the Tranche A Shortfall Amount on the First Determination Date is $520 million
resulting in 482,332 Tranche A Shortfall Shares, and as of the Second
Determination Date (which, in this example, is the Tranche A Catch Up
Determination Date with respect to the First Determination Date) the Second
Tranche A Target Amount of Cumulative Signed Purchasing Volume of $2,347 million
is met, then the 482,332 Tranche A Shortfall Shares relating to the First
Determination Date which had become a Tranche A Shortfall Determination Date
will become Vested Shares on the Second Determination Date, provided however,
that if as of the Second Determination Date Cumulative Signed Purchasing Volume
is less than $2,347 million, the 482,332 Tranche A Shortfall Shares relating to
the First Determination Date shall never become vested, even if as of the Third
Determination Date the relevant Tranche A Target Amount for such Determination
Date is met or exceeded.
(e) If, on the December 15 immediately preceding a Determination
Date, UHC delivers to Parent written evidence establishing that a number of
Tranche A Shares would become Vested Shares on such December 15 if such December
15 were to be treated as if it were the immediately following Determination Date
(but not any other subsequent Determination Date or December 15), then such
Tranche A Shares shall become Vested Shares as of such December 15, and the
number of Tranche A Shares eligible to become Vested Shares on the immediately
following Determination Date shall be reduced by a like amount. If less than all
of the Tranche A Shares available to become Vested Shares on a particular
December 15 become Vested Shares on such date, any and all such Tranche A Shares
which did not become Vested Shares on such December 15 may become Vested Shares
on the Determination Date immediately following such December 15 in accordance
with the pro rata provisions of paragraph (d), and if such Determination Date
immediately following such December 15 is a Tranche A Shortfall Determination
Date, each of the December 15 immediately following such Tranche A Shortfall
Determination Date and the Determination Date immediately following such Tranche
A Shortfall Determination Date, but no other December 15 or Determination Date,
shall be a Tranche A Catch Up Determination Date for such Tranche A Shortfall
Determination Date. All other provisions and limitations of paragraph (d) with
respect to a Tranche A Catch Up Determination Date shall be applicable.
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1.5 Forfeiture of Tranche A Shares. On and following any date on which
any Tranche A Shares cannot become Vested Shares pursuant to the provisions of
Section 1.4 of this Amendment, all such Tranche A Shares that cannot become
Vested Shares shall, without the payment of any consideration by Parent or any
further action by UHC or Parent, be forfeited by UHC to Parent. Upon any such
forfeiture of Tranche A Shares, UHC shall promptly, but in no event later than
three business days after such forfeiture, return the certificates representing
the shares so forfeited to Parent for cancellation.
1.6 Vesting of Tranche B Shares.
(a) 469,965 Tranche B Shares shall become Vested Shares on the
First Determination Date if Cumulative Signed Purchasing Volume as of the First
Determination Date is at least $2,026 million (the "FIRST TRANCHE B TARGET
AMOUNT").
(b) 469,965 Tranche B Shares shall become Vested Shares on the
Second Determination Date if Cumulative Signed Purchasing Volume as of the
Second Determination Date is at least $3,130 million (the "SECOND TRANCHE B
TARGET AMOUNT").
(c) 469,965 Tranche B Shares shall become Vested Shares on the
Third Determination Date if Cumulative Signed Purchasing Volume as of the Third
Determination Date is at least $4,308 million (the "THIRD TRANCHE B TARGET
AMOUNT").
(d) In the event the Tranche B Target Amount of Cumulative Signed
Purchasing Volume specified in any of Section 1.6 paragraphs (a), (b), or (c)
above is not achieved as of the particular Determination Date specified in such
paragraph (such shortfall below a particular Tranche B Target Amount being
referred to as a "TRANCHE B SHORTFALL AMOUNT"), then the number of Tranche B
Shares which shall become Vested Shares at a particular Determination Date
pursuant to Section 1.6 paragraphs (a), (b), or (c) above shall equal the
product of 469,965 and a fraction, the numerator of which is the Cumulative
Signed Purchasing Volume as of the Determination Date in question minus the
Tranche A Target Amount for the Determination Date in question and the
denominator of which is the Tranche B Target Amount for the Determination Date
in question minus the Tranche A Target Amount for the Determination Date in
question. It is agreed that no Tranche B Shares will become Vested Shares on a
particular Determination Date if the Tranche A Target Amount relating to such
Determination Date is not exceeded. By way of example, if as of June 30, 2002,
Cumulative Signed Purchasing Volume is $2,000 million, 445,817 Tranche B Shares
shall become Vested Shares:
469,965 x (2,000 - 1,520) = 445,817 Vested Shares
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(2,026 - 1,520)
If there is a Tranche B Shortfall Amount relating to a particular
Determination Date, then the number of Tranche B Shares which will not vest due
to such shortfall shall equal 469,965 minus the number of Tranche B Shares which
became Vested Shares on such Determination Date (the "TRANCHE B SHORTFALL
SHARES"). If no Tranche B Shares became Vested Shares on a Determination Date,
then there will be 469,965 Tranche B Shortfall Shares with
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respect to the Determination Date in question. Using the facts set forth in the
preceding example, if as of June 30, 2002, Cumulative Signed Purchasing Volume
is $2,000 million, and 445,817 Tranche B Shares become Vested Shares, then
24,148 Tranche B Shares shall be deemed Tranche B Shortfall Shares as of the
First Determination Date:
469,965 - 445,817 = 24,148 Tranche B Shortfall Shares
A Determination Date as of which there is a Tranche B Shortfall
Amount is referred to as a "TRANCHE B SHORTFALL DETERMINATION DATE." A
Determination Date which occurs immediately after a Tranche B Shortfall
Determination Date is referred to as a "TRANCHE B CATCH UP DETERMINATION DATE."
If as of a Tranche B Catch Up Determination Date, the applicable Tranche B
Target Amount for such Tranche B Catch Up Determination Date is met or exceeded,
then the Tranche B Shortfall Shares which did not vest on such Tranche B
Shortfall Determination Date shall immediately become Vested Shares on the
Tranche B Catch Up Determination Date, it being agreed that if the Tranche B
Target Amount relating to such Tranche B Catch Up Determination Date is not met,
such Tranche B Shortfall Shares shall never become vested. By way of example, if
the Tranche B Shortfall Amount on the First Determination Date is $26 million
resulting in 24,148 Tranche B Shortfall Shares, and as of the Second
Determination Date (which, in this example, is the Tranche B Catch Up
Determination Date with respect to the First Determination Date) the Second
Tranche B Target Amount of Cumulative Signed Purchasing Volume of $3,130 million
is met, then the 24,148 Tranche B Shortfall Shares relating to the First
Determination Date which had become a Shortfall Determination Date will become
Vested Shares on the Second Determination Date, provided however, that if as of
the Second Determination Date Cumulative Signed Purchasing Volume is less than
$3,130 million, the 24,148 Tranche B Shortfall Shares relating to the First
Determination Date shall never become vested, even if as of the Third
Determination Date the relevant Tranche B Target Amount for such Determination
Date is met or exceeded.
(e) If, on the December 15 immediately preceding a Determination
Date, UHC delivers to Parent written evidence establishing that a number of
Tranche B Shares would become Vested Shares on such December 15 if such December
15 were to be treated as if it were the immediately following Determination Date
(but not any other subsequent Determination Date or December 15), then such
Tranche B Shares shall become Vested Shares as of such December 15, and the
number of Tranche B Shares eligible to become Vested Shares on the immediately
following Determination Date shall be reduced by a like amount. If less than all
of the Tranche B Shares available to become Vested Shares on a particular
December 15 become Vested Shares on such date, any and all such Tranche B Shares
which did not become Vested Shares on such December 15 may become Vested Shares
on the Determination Date immediately following such December 15 in accordance
with the pro rata provisions of paragraph (d), and if such Determination Date
immediately following such December 15 is a Tranche B Shortfall Determination
Date, each of the December 15 immediately following such Tranche B Shortfall
Determination Date and the Determination Date immediately following such Tranche
B Shortfall Determination Date, but no other December 15 or Determination Date,
shall be a Tranche B Catch Up Determination Date for such Tranche B Shortfall
Determination Date. All other provisions and limitations of paragraph (d) with
respect to a Tranche B Catch Up Determination Date shall be applicable.
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1.7 Forfeiture of Tranche B Shares. On and following any date on which
any Tranche B Shares cannot become Vested Shares pursuant to the provisions of
Section 1.6 of this Amendment, all such Tranche B Shares that cannot become
Vested Shares shall, without the payment of any consideration by Parent or any
further action by UHC or Parent, be forfeited by UHC to Parent. Upon any such
forfeiture of Tranche B Shares, UHC shall promptly, but in no event later than
three business days after such forfeiture, return the certificates representing
the shares so forfeited to Parent for cancellation.
1.8 Continuation of Vesting Provisions. In the event of a merger,
consolidation, business combination, recapitalization, liquidation, dissolution
or similar transaction involving Parent pursuant to which shares of Common Stock
are converted into a different number or kind of security or other property
(other than cash), all Restricted Shares that are not Vested Shares shall remain
subject to the vesting provisions and the Forfeiture Risk described in this
Article I, after equitably and proportionately adjusting the provisions of this
Article I to the number and kind of securities or other property into which the
Restricted Shares have been converted pursuant to such corporate transaction. In
the event of a merger, consolidation, business combination, recapitalization,
liquidation, dissolution or similar transaction involving Parent pursuant to
which all shares of Common Stock are converted into cash, or a cash tender offer
for all shares of Common Stock is consummated, all Restricted Shares shall
become Vested Shares.
ARTICLE II
REPRESENTATIONS, WARRANTIES
AND CERTAIN AGREEMENTS OF PARENT
Parent hereby represents and warrants to UHC, subject to the exceptions
specifically disclosed in writing in the disclosure letter delivered by Parent
dated as of the date hereof and certified by a duly authorized officer of Parent
(the "PARENT DISCLOSURE LETTER") (which Parent Disclosure Letter shall be deemed
to be representations and warranties to UHC by Parent under this Article II), as
follows:
2.1 Organization of Parent.
(a) Parent and each of its subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has all requisite corporate power and
authority, and all requisite qualifications to do business as a foreign
corporation, to conduct its business in the manner in which its business is
currently being conducted, except where the failure to be so organized, existing
or in good standing or to have such power, authority or qualifications would
not, individually or in the aggregate, have a Material Adverse Effect on Parent.
(b) The Restricted Shares, when issued as provided in this
Agreement, will be duly authorized and validly issued, fully paid and
nonassessable.
(c) Based in part on the representations made by UHC in Article
III hereof, the issuance of the Restricted Shares solely to UHC in accordance
with this Agreement (assuming no change in currently applicable law) is exempt
from the registration and prospectus delivery requirements of the Securities Act
of 1933, as amended (the "1933 ACT").
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2.2 Due Authorization.
(a) Parent has all requisite corporate power and authority to
enter into this Amendment and to consummate the transactions contemplated
hereby. The execution and delivery of this Amendment and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of Parent. This Amendment has been duly executed
and delivered by Parent and, assuming the due authorization, execution and
delivery thereof by UHC, constitutes the valid and binding obligation of Parent,
enforceable against Parent in accordance with its terms, except as
enforceability may be limited by bankruptcy and other similar laws affecting the
rights of creditors generally and general principles of equity.
(b) The execution and delivery of this Amendment by Parent does
not, and the performance of this Amendment by Parent will not, (i) conflict with
or violate the Parent Charter Documents, (ii) conflict with or violate any law,
rule, regulation, order, judgment or decree applicable to Parent or by which any
of its properties is bound or affected, or (iii) result in any breach of or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or impair Parent's rights or alter the rights or
obligations of any third party under, or give to others any rights of
termination, amendment, acceleration or cancellation of, or result in the
creation of an Encumbrance on any of the properties or assets of Parent pursuant
to, any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation to which Parent is a party
or by which Parent or any of its properties are bound or affected, except, in
the case of clauses (ii) and (iii), for such conflicts, violations, breaches,
defaults, impairments, or rights which, individually or in the aggregate, would
not have a Material Adverse Effect on Parent or a material adverse effect on
Parent's ability to perform its obligations hereunder. There are no consents,
waivers or approvals under any of Parent's or any of its subsidiaries'
agreements, contracts, licenses or leases required to be obtained in connection
with the consummation of the transactions contemplated hereby, which, if
individually or in the aggregate not obtained, would have a Material Adverse
Effect on Parent or a material adverse effect on Parent's ability to perform its
obligations hereunder.
(c) No consent, approval, order or authorization of, or
registration, declaration or filing with any court, administrative agency or
commission or other governmental entity or instrumentality, foreign or domestic
("GOVERNMENTAL ENTITY") is required to be obtained or made by Parent in
connection with the execution, delivery and performance of this Amendment or the
consummation of the transactions contemplated hereby, except for (i) such
consents, approvals, orders, authorizations, registrations, declarations and
filings as may be required under applicable federal, foreign and state
securities (or related) laws, and (ii) such other consents, authorizations,
filings, approvals and registrations which if not obtained or made would not
have a Material Adverse Effect on Parent or have a material adverse effect on
the ability of the parties hereto to consummate or perform the transactions
contemplated hereby.
2.3 Nasdaq Listing. Parent agrees that it will authorize for listing on
the Nasdaq Stock Market the Restricted Shares issuable in connection with this
Amendment, effective upon official notice of issuance.
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2.4 Litigation. There are no claims, suits, actions or proceedings
pending or, to the knowledge of Parent, threatened against, relating to or
affecting Parent or any of its subsidiaries, before any Governmental Entity or
any arbitrator that seeks to restrain or enjoin the consummation of the
transactions contemplated by this Amendment.
2.5 Brokers' and Finders' Fees. Parent has not incurred, nor will it
incur, directly or indirectly, any liability for brokerage or finders' fees or
agents' commissions or any similar charges in connection with this Amendment.
2.6 Anti-Takeover Protections. The Board of Directors of Parent has
taken all actions so that the restrictions contained in Section 203 of the
General Corporation Law of the State of Delaware applicable to a "business
combination" (as defined in such Section 203) will not apply to the execution,
delivery or performance of this Amendment. To Parent's knowledge, no other
anti-takeover, control share acquisition, fair price, moratorium or other
similar statute or regulation applies or purports to apply to this Amendment or
the transactions contemplated hereby.
ARTICLE III
REPRESENTATIONS, WARRANTIES
AND CERTAIN AGREEMENTS OF UHC
UHC hereby represents and warrants to Parent as follows:
3.1 Organization, Good Standing and Qualification. UHC represents that
it is an entity duly organized, validly existing and in good standing under the
laws of the state of its formation and has all requisite power and authority,
and all requisite qualifications to do business as a foreign entity, to conduct
its business in the manner in which its business is currently being conducted,
except where the failure to be so organized, existing or in good standing or to
have such power, authority or qualifications would not have a Material Adverse
Effect on UHC.
3.2 Authorization.
(a) UHC has all requisite power and authority to enter into this
Amendment and to consummate the transactions contemplated hereby. The execution
and delivery of this Amendment and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary action on the
part of UHC. This Amendment has been duly executed and delivered by UHC and
constitutes the valid and binding obligations of UHC, enforceable against UHC in
accordance with its terms, except as enforceability may be limited by bankruptcy
and other similar laws affecting the rights of creditors generally and general
principles of equity.
(b) The execution and delivery of this Amendment by UHC does not,
and the performance of this Amendment by UHC will not, (i) conflict with or
violate the certificate of incorporation, bylaws, operating agreement or other
organizational documents of UHC, (ii) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to UHC or by which any of its
properties are bound or affected, or (iii) result in any breach of or constitute
a default (or an event that with notice or lapse of time or both would become a
default) under, or impair UHC's rights or alter the rights or obligations of any
third party under, or give to others
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any rights of termination, amendment, acceleration or cancellation of, or result
in the creation of an Encumbrance on any of the properties or assets of UHC
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to which UHC is a
party or by which UHC or any of its properties are bound or affected, except, in
the case of clauses (ii) and (iii), for such conflicts, violations, breaches,
defaults, impairments, or rights which, individually or in the aggregate, would
not have a Material Adverse Effect on UHC or a material adverse effect on UHC's
ability to perform its obligations hereunder. There are no consents, waivers or
approvals under any of UHC's or any of its subsidiaries' agreements, contracts,
licenses or leases which are required to be obtained in connection with the
consummation of the transactions contemplated hereby, which, if individually or
in the aggregate not obtained, would have a Material Adverse Effect on UHC or a
material adverse effect on UHC's ability to perform its obligations hereunder.
(c) No consent, approval, order or authorization of, or
registration, declaration or filing with any Governmental Entity is required to
be obtained or made by UHC in connection with the execution and delivery of this
Amendment or the consummation of the transactions contemplated hereby, except
for (i) such consents, approvals, orders, authorizations, registrations,
declarations and filings as may be required under applicable federal, foreign
and state securities (or related) laws, and (ii) such other consents,
authorizations, filings, approvals and registrations which if not obtained or
made would not have a Material Adverse Effect on UHC or have a material adverse
effect on the ability of the parties hereto to consummate or perform the
transactions contemplated hereby.
3.3 Acquisition for Own Account. Except as previously disclosed to
Parent, the Restricted Shares to be delivered to UHC hereunder will be acquired
for UHC's own account, not as a nominee or agent, and not with a view to the
public resale or distribution thereof within the meaning of the 1933 Act, and
UHC represents that it has no present intention or agreement to sell, grant any
participation in, or otherwise distribute any of the Restricted Shares to be
acquired by UHC hereunder in any public resale or distribution within the
meaning of the 1933 Act. UHC also represents that it has not been formed for the
specific purpose of acquiring the Restricted Shares.
3.4 Disclosure of Information. UHC believes it has received or has had
full access to all the information it considers necessary or appropriate to make
an informed ownership decision with respect to the Restricted Shares to be
issued to UHC under this Agreement. UHC further has had an opportunity to ask
questions and receive answers from Parent regarding the terms and conditions of
the offering of the Restricted Shares and to obtain additional information (to
the extent Parent possessed such information or could acquire it without
unreasonable effort or expense) necessary to verify any information furnished to
UHC or to which UHC had access. The foregoing, however, does not in any way
limit or modify the representations and warranties made by Parent in Article II.
3.5 Experience. UHC understands that ownership of the Restricted Shares
involves substantial risk. UHC: (i) has experience as owner of securities of
companies in the development stage and acknowledges that UHC is able to fend for
itself, can bear the economic risk of UHC's ownership of the Restricted Shares
and has such knowledge and experience in financial or business matters that UHC
is capable of evaluating the merits and risks of ownership
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of the Restricted Shares and protecting its own interests in connection with
this ownership and/or (ii) has a preexisting personal or business relationship
with Parent and certain of its officers, directors or controlling persons of a
nature and duration that enables UHC to be aware of the character, business
acumen and financial circumstances of such persons.
3.6 Accredited Investor Status. UHC is an "accredited investor" within
the meaning of Regulation D promulgated under the 1933 Act.
3.7 Restricted Securities. UHC understands that the Restricted Shares
will be characterized as "restricted securities" under the 1933 Act inasmuch as
they are being acquired from Parent in a transaction not involving a public
offering and that under the 1933 Act and applicable regulations thereunder such
securities may be resold without registration under the 1933 Act only in certain
limited circumstances. In this connection, UHC represents that UHC is familiar
with Rule 144 of the SEC, as presently in effect, and understands the resale
limitations imposed thereby and by the 1933 Act.
3.8 No Solicitation. At no time was UHC presented with or solicited by
any publicly issued or circulated newspaper, mail, radio, television or other
form of general advertising or solicitation in connection with the issuance or
delivery of the Restricted Shares.
3.9 Further Limitations on Disposition. Without in any way limiting the
representations set forth above, UHC agrees not to make any disposition of all
or any portion of the Vested Shares or of any interest therein to any person or
entity unless:
(a) there is then in effect a registration statement under the
1933 Act covering such proposed disposition of the Vested Shares and such
disposition is made in accordance with such registration statement; or
(b) UHC shall have notified Parent of the proposed disposition of
the Vested Shares and shall have furnished Parent with a statement of the
circumstances surrounding such proposed disposition, and, at the expense
of UHC or its transferee, with an opinion of counsel, reasonably
satisfactory to Parent, that such disposition will not require
registration of such securities under the 1933 Act.
3.10 Transfer of Restricted Shares. UHC agrees that it will not, directly
or indirectly, in a single transaction or series of related transactions,
without the prior written consent of Parent, sell, pledge, Encumber, transfer,
assign or otherwise dispose (each, a "TRANSFER") of legal or beneficial
ownership of any Restricted Shares to any person prior to such time as they
become Vested Shares pursuant to this Agreement. Any purported Transfer in
violation of the foregoing restriction shall be void and Parent may, and may
instruct the transfer agent of the Common Stock to, refuse to record, whether on
the stock records of Parent or otherwise, any purported transfer of unvested
Restricted Shares or recognize any purported transferee of unvested Restricted
Shares and Parent may issue stop transfer orders with respect to any such
Transfer of unvested Restricted Shares.
3.11 Legends. UHC understands and agrees that the certificates evidencing
the Restricted Shares and the Vested Shares will bear legends substantially
similar to those set forth
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in paragraphs (a) and (b) below, and that the certificates evidencing the
Restricted Shares will bear a legend substantially similar to that set forth in
paragraph (c) below, in addition to any other legend that may be required by
applicable law, by Parent's Certificate of Incorporation or Bylaws, or by any
agreement between Parent and UHC:
(a) THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE
SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR
RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE
SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL
RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF
THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER
OTHERWISE PERMITTED UNDER CONTRACTUAL RESTRICTIONS ON RESALE APPLICABLE TO
THESE SECURITIES IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE
SECURITIES LAWS.
(b) THE SECURITIES REPRESENTED HEREBY MAY BE SUBJECT TO CERTAIN
RESTRICTIONS ON RESALE AND ON VOTING AND THE HOLDERS HEREOF MAY BE BOUND
BY CERTAIN RESTRICTIONS ON ACQUISITION OF THE ISSUER'S CAPITAL STOCK
PURSUANT TO AN AMENDED AND RESTATED COMMON STOCK AND WARRANT AGREEMENT
BETWEEN THE ORIGINAL HOLDER OF THESE SECURITIES AND THE ISSUER, A COPY OF
WHICH MAY BE OBTAINED FROM THE ISSUER.
(c) PURSUANT TO THE TERMS OF AN AMENDED AND RESTATED COMMON STOCK
AND WARRANT AGREEMENT BETWEEN THE ORIGINAL HOLDER OF THESE SECURITIES AND
THE ISSUER, A COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER, THE
SECURITIES REPRESENTED HEREBY MAY NOT BE SOLD, PLEDGED, ENCUMBERED OR
OTHERWISE TRANSFERRED. THE ISSUER WILL NOT RECOGNIZE ON ITS STOCK TRANSFER
RECORDS ANY PURPORTED TRANSFEREE OF THE SECURITIES REPRESENTED HEREBY.
The legend set forth in (a) above shall be removed by Parent from any
certificate evidencing Restricted Shares or Vested Shares upon delivery to
Parent of an opinion by counsel, reasonably satisfactory to Parent, to the
effect that a registration statement under the 1933 Act is at that time in
effect with respect to the legended security or to the effect that such security
can be freely transferred in a public sale without such a registration statement
being in effect and that such transfer will not jeopardize the exemption or
exemptions from registration pursuant to which Parent issued the Restricted
Shares or the Vested Shares when they were Restricted Shares. The legend set
forth in (b) above shall be removed by Parent from any certificate evidencing
Restricted Shares or Vested Shares upon delivery to Parent of an opinion by
counsel, reasonably satisfactory to Parent, to the effect that the resale,
voting and standstill restrictions contained in this Agreement, as amended
hereby, are no longer applicable to the holder of the securities represented
thereby. The legend set forth in (c) above shall be removed by Parent from any
certificate evidencing Restricted Shares which have become Vested Shares.
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3.12 Dividends for Restricted Shares. In the event that Parent declares a
dividend or other distribution to holders of its Common Stock, any such dividend
paid or distribution made in respect of Restricted Shares that have not become
Vested Shares shall be paid or made to an escrow holder selected by Parent and
reasonably satisfactory to UHC and held by such person to be delivered either to
UHC upon the vesting and delivery of the Restricted Shares in respect of which
such dividend or distribution was made or to Parent upon the forfeiture of the
Restricted Shares in respect of which such dividend or distribution was made.
ARTICLE IV
ADDITIONAL AMENDMENTS
4.1 Amendment of Voting Provisions. Section 6.1 of the Agreement is
hereby amended to read in its entirety as follows:
"6.1 Voting of Common Stock. UHC agrees that from and after the
date of the Closing through the fifth anniversary of the Closing (the
"FIFTH ANNIVERSARY"), and for as long after the Fifth Anniversary as the
outstanding shares of Common Stock (including Restricted Shares and Vested
Shares) beneficially owned by UHC together with all "affiliates" (which
for purposes of this Agreement (other than Section 3.12) shall have the
meaning given such term in Rule 144(a)(1) promulgated under the 0000 Xxx)
of UHC exceeds 9% of the then outstanding Common Stock of Parent (the
entire such period, the "RESTRICTED PERIOD"), to the extent that the
outstanding shares of Common Stock (including outstanding Shares,
Restricted Shares and Vested Shares) beneficially owned by UHC together
with all affiliates of UHC exceeds 9% of the then outstanding Common Stock
of Parent (the shares (including outstanding Shares, Restricted Shares and
Vested Shares) in excess of such 9% threshold, "EXCESS SHARES"), UHC
shall, and shall cause its controlled affiliates to, vote all Excess
Shares it holds or is entitled to vote in proportion to the votes cast by
all other stockholders of Parent in connection with each matter submitted
to Parent's stockholders for approval, except for (i) a proposed Change of
Control or (ii) an amendment of the Certificate of Incorporation of Parent
that would materially and adversely affect UHC as a Parent stockholder in
a manner different from the effect such amendment would have on other
Parent stockholders generally. On all matters submitted to Parent
stockholders for approval other than those identified in clauses (i) and
(ii) of the preceding sentence, UHC shall, and shall cause its controlled
affiliates to, vote all Excess Shares in proportion to the votes cast by
all other stockholders of Parent in connection with each matter submitted
to Parent stockholders' for approval, including, without limitation, on
any matters regarding equity-based or other compensation plans of Parent,
the issuance of capital stock of Parent, amendments to the Certificate of
Incorporation of Parent other than as set forth in clause (ii) above,
elections of directors to the Board of Directors, or transactions
involving interested or related parties. Notwithstanding the foregoing,
all Restricted Shares that are not Vested Shares shall be voted on all
matters submitted to Parent's stockholders for approval in proportion to
the votes cast by all other stockholders of Parent, including those
matters identified in items (i) and (ii) of the first sentence of this
section. Notwithstanding any voting restrictions set forth herein, the
Board of Directors of Parent may waive any voting restriction set forth
herein with respect to any particular matter. For purposes of
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this Agreement, "CHANGE OF CONTROL" means the consummation of any
transaction or series of related transactions, including an
acquisition of Parent by another entity and any reorganization,
merger, consolidation or share exchange, that results in the
beneficial owners of Parent's capital stock immediately prior to the
transaction or transactions holding less than 50% of the voting
power of Parent immediately after the transaction or transactions,
or a transaction or series of related transactions which result in
the sale, exchange, transfer, acquisition or disposition of more
than 50% of the assets of Parent. For the avoidance of doubt, for
purposes of this Section 6.1, VHA, Novation and HPPI are not
"affiliates" of UHC."
4.2 Other Amendments.
(a) Section 6.2 of the Agreement shall be amended by deleting the
phrase "except pursuant to the Warrant."
(b) Section 6.4(a) of the Agreement shall be amended by deleting
the phrase, in two locations, "on a fully converted basis (taking into
account for VHA, all shares of Common Stock issuable upon the exercise of
the warrant issued to VHA pursuant to the VHA Agreement)."
(c) Section 6.4(b) of the Agreement shall be amended by deleting
the phrase, "on a fully converted basis (taking into account for UHC, all
shares of Common Stock issuable upon the exercise of the Warrant)."
Section 6.4(b) of the Agreement shall be further amended by adding the
following sentence at the end of such Section 6.4(b): "Notwithstanding the
foregoing, UHC will not have the right to nominate a person to Parent's
Board of Directors pursuant to this Section 6.4(b) for so long as Xxxxxx
X. Xxxxx, or any other person nominated or appointed by UHC, is a member
of Parent's Board of Directors."
(d) Section 6.4(c) of the Agreement shall be amended by deleting
the phrase, "on a fully converted basis (taking into account for UHC, all
shares of Common Stock issuable upon the exercise of the Warrant)."
Section 6.4(c) of the Agreement shall be further amended by adding the
following sentence at the end of such Section 6.4(c): "Notwithstanding the
foregoing, Parent will not be obligated to comply with the foregoing
provisions of this Section 6.4(c) for so long as Xxxxxx X. Xxxxx, or any
other person nominated or appointed by UHC, is a member of Parent's Board
of Directors."
(e) Section 10.9 of the Agreement is hereby amended to read in its
entirety as follows:
"10.9 Entire Agreement. The Agreement, as amended by this
Amendment, together with all exhibits and schedules and any
disclosure letters delivered pursuant thereto and hereto, and the
Outsourcing Agreement constitute the entire agreement and
understanding of the parties with respect to the subject matter
thereof and hereof and supersedes any and all prior negotiations,
correspondence, agreements, understandings duties or obligations
between the parties with respect to the subject matter hereof."
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ARTICLE V
GENERAL PROVISIONS
5.1 Reaffirmation. The Agreement, as amended hereby, is in all respects
ratified, reaffirmed and remade, and is in full force and effect.
5.2 Governing Law. This Amendment shall be governed by and construed
under the internal laws of the State of Delaware as applied to agreements among
Delaware residents entered into and to be performed entirely within Delaware,
without reference to principles of conflict of laws or choice of laws.
5.3 Counterparts. This Amendment may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same agreement.
* * * * *
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6.5 Nasdaq Listing. The Shares shall have been approved for
listing on the Nasdaq Stock Market, subject to official notice of issuance.
ARTICLE VII
CONDITIONS TO THE COMPANY'S OBLIGATIONS AT CLOSING
The obligations of the Company under this Agreement are subject to
the fulfillment or waiver on or before the Closing of each of the following
conditions:
7.1 Representations and Warranties. The representations and
warranties of UHC contained in Article IV shall be true and correct in all
material respects on the date of the Closing with the same effect as though such
representations and warranties had been made on and as of the Closing. The
Company shall have received a certificate with respect to the foregoing signed
on behalf of UHC by the Chief Executive Officer or the Chief Financial Officer
of UHC.
7.2 Performance. UHC shall have performed and complied in all
material respects with all agreements, obligations and conditions contained in
this Agreement that are required to be performed or complied with by it on or
before the Closing.
7.3 Securities Exemptions. The issuance of the Shares to UHC
pursuant to this Agreement shall be exempt from the registration requirements of
the 1933 Act, the qualifications requirements of California Law and the
registration and/or qualification requirements of all other applicable state
securities laws.
7.4 Consents. (i) All required approvals or consents of any
Governmental Entity or other person in connection with the consummation of the
transactions contemplated hereby shall have been obtained (and all relevant
statutory, regulatory or other governmental waiting periods, shall have expired)
unless the failure to receive any such approval or consent would not be
reasonably likely, directly or indirectly, to result in a Material Adverse
Effect on the Company and its subsidiaries, taken as a whole, and (ii) all such
approvals and consents which have been obtained shall be on terms that are not
reasonably likely, directly or indirectly, to result in a Material Adverse
Effect on the Company and its subsidiaries, taken as a whole.
ARTICLE VIII
TERMINATION
8.1 Termination. This Agreement may be terminated prior to the
Closing:
(a) by mutual written consent duly authorized by the Boards of
Directors of the Company and UHC;
(b) by either the Company or UHC if the Closing shall not have
occurred by February 15, 2001 for any reason; provided, however, that the right
to terminate this Agreement under this Section 9.1(b) shall not be available to
any party whose action or failure to act has been a principal cause of or
resulted in the failure of the Closing to occur on or before such date and such
action or failure to act constitutes a breach of this Agreement; or
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(c) by either the Company or UHC if a Governmental Entity shall
have issued an order, decree or ruling or taken any other action, in any case
having the effect of permanently restraining, enjoining or otherwise prohibiting
the Closing, which order, decree, ruling or other action is final and
nonappealable.
8.2 Notice of Termination; Effect of Termination. Any proper
termination of this Agreement under Section 8.1 will be effective immediately
upon the delivery of written notice of the terminating party to the other party
hereto. In the event of the termination of this Agreement as provided in Section
8.1, this Agreement shall be of no further force or effect, except (i) as set
forth in this Section 8.2 and Article IX, each of which shall survive the
termination of this Agreement, and (ii) nothing herein shall relieve either
party from liability for any willful breach of this Agreement.
ARTICLE IX
GENERAL PROVISIONS
9.1 Survival of Warranties. The representations, warranties and
covenants of UHC (except for any covenant that by its express terms survives the
Closing, and for the representations, warranties and covenants set forth in
Sections 4.3 through 4.10 inclusive, which shall survive the execution and
delivery of this Agreement and the Closing) contained in or made pursuant to
this Agreement shall terminate at the Closing. The representations, warranties
and covenants of the Company (except for any covenant that by its express terms
survives the Closing) contained in or made pursuant to this Agreement shall
terminate at the Closing.
9.2 Assignment. No party may assign either this Agreement or any
of its rights, interests, or obligations hereunder without the prior written
consent of the other party hereto. Subject to the preceding sentence, this
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and permitted assigns. Any purported
assignment in violation of this Section shall be void.
9.3 Governing Law. This Agreement shall be governed by and
construed under the internal laws of the State of Delaware as applied to
agreements among Delaware residents entered into and to be performed entirely
within Delaware, without reference to principles of conflict of laws or choice
of laws.
9.4 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.
9.5 Interpretation; Certain Defined Terms.
(a) When a reference is made in this Agreement to Exhibits, such
reference shall be to an Exhibit to this Agreement unless otherwise indicated.
When a reference is made in this Agreement to Sections, such reference shall be
to a Section of this Agreement unless otherwise indicated. The words "INCLUDE,"
"INCLUDES" and "INCLUDING" when used herein shall be deemed in each case to be
followed by the words "WITHOUT LIMITATION." The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
18
meaning or interpretation of this Agreement. When reference is made herein to
"THE BUSINESS OF" an entity, such reference shall be deemed to include the
business of all direct and indirect subsidiaries of such entity. Reference to
the subsidiaries of an entity shall be deemed to include all direct and indirect
subsidiaries of such entity.
(b) For purposes of this Agreement, "ENCUMBRANCES" means any lien,
pledge, hypothecation, charge, mortgage, security interest, encumbrance, claim,
option, right of first refusal, preemptive right, community property interest or
restriction of any nature (including any restriction on the voting of any
security, any restriction on the transfer of any security or other asset, any
restriction on the receipt of any income derived from any asset, any restriction
on the use of any asset and any restriction on the possession, exercise or
transfer of any other attribute of ownership of any asset) (other than (i) liens
for taxes not yet due and payable; (ii) liens reflected on the Company Balance
Sheet, if applicable; (iii) liens which are not material in character, amount or
extent, and which do not materially detract from the value or materially
interfere with the use of the property subject thereto or affected thereby; and
(iv) contractor's liens).
(c) For purposes of this Agreement, the term "MATERIAL ADVERSE
EFFECT" when used in connection with an entity means any change, event,
violation, inaccuracy, circumstance or effect that is or is reasonably likely to
be materially adverse to the business, assets (including intangible assets),
capitalization, financial condition, operations or results of operations of such
entity taken as a whole with its subsidiaries, except to the extent that any
such change, event, violation, inaccuracy, circumstance or effect directly and
primarily results from (i) changes in general economic conditions or changes
affecting the industry generally in which such entity operates (provided that
such changes do not affect such entity in a substantially disproportionate
manner) or (ii) changes in the trading prices for such entity's capital stock.
(d) For purposes of this Agreement, the term "PERSON" shall mean
any individual, corporation (including any non-profit corporation), general
partnership, limited partnership, limited liability partnership, joint venture,
estate, trust, company (including any limited liability company or joint stock
company), firm or other enterprise, association, organization, entity or
Governmental Entity.
9.6 Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given upon delivery either personally or by
commercial delivery service, or sent via facsimile (receipt confirmed) to the
parties at the following addresses or facsimile numbers (or at such other
address or facsimile number for a party as shall be specified by like notice):
IF TO UHC: WITH A COPY TO:
University HealthSystem Consortium XxXxxxxxx, Will & Xxxxx
0000 Xxxxxx Xxxx, Xxxxx 000 000 Xxxx Xxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxxxx 00000 Xxxxxxx, Xxxxxxxx 00000
Facsimile: 000-000-0000 Facsimile: 000-000-0000
Attn: Executive Vice President Attn: Xxxxxxxx X. Xxxxxx
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IF TO THE COMPANY: WITH A COPY TO:
Xxxxxxxx.xxx, Inc. Fenwick & West LLP
3061 Zanker Road Two Xxxx Xxxx Xxxxxx,
Xxx Xxxx, Xxxxxxxxxx 00000 Xxxx Xxxx, Xxxxxxxxxx 00000
Facsimile: 000-000-0000 Facsimile: 000-000-0000
Attn: Chief Financial Officer
Attn: Xxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxx
9.7 Expenses; Finder's Fees. All fees and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such expenses whether or not the Closing occurs. UHC
agrees to indemnify and to hold harmless the Company from any liability for any
commission or compensation in the nature of a finder's or broker's fee (and any
asserted liability) for which UHC or any of its officers, partners, members,
employees, or representatives is responsible. The Company agrees to indemnify
and hold harmless UHC from any liability for any commission or compensation in
the nature of a finder's or broker's fee (and any asserted liability) for which
the Company or any of its officers, employees or representatives is responsible.
9.8 Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision(s) shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision(s) were so excluded and shall be enforceable in
accordance with its terms.
9.9 Entire Agreement. This Agreement, together with all exhibits
and schedules hereto, constitute the entire agreement and understanding of the
parties with respect to the subject matter hereof and supersedes any and all
prior negotiations, correspondence, agreements, understandings duties or
obligations between the parties with respect to the subject matter hereof.
9.10 Further Assurances. From and after the date of this Agreement,
upon the request of UHC or the Company, the Company and UHC shall execute and
deliver such instruments, documents or other writings as may be reasonably
necessary or desirable to confirm and carry out and to effectuate fully the
intent and purposes of this Agreement.
9.11 Amendment; Extension; Waiver. Subject to applicable law, this
Agreement may be amended by the parties hereto at any time by execution of an
instrument in writing signed on behalf of the Company and UHC. At any time prior
to the Closing any party hereto may, to the extent legally allowed, (i) extend
the time for the performance of any of the obligations or other acts of the
other party hereto, (ii) waive any inaccuracies in the representations and
warranties made to such party contained herein or in any document delivered
pursuant hereto and (iii) waive compliance with any of the agreements or
conditions for the benefit of such party contained herein. Any agreement on the
part of a party hereto to any such extension or waiver shall be valid only if
set forth in an instrument in writing signed on behalf of such party. Delay in
exercising any right under this Agreement shall not constitute a waiver of such
right.
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9.12 Other Remedies; Specific Performance. Except as otherwise
provided herein, any and all remedies herein expressly onferred upon a party
will be deemed cumulative with and not exclusive of any other remedy conferred
hereby, or by law or equity upon such party, and the exercise by a party of any
one remedy will not preclude the exercise of any other remedy. The parties
hereto agree that irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to seek an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having jurisdiction, this
being in addition to any other remedy to which they are entitled at law or in
equity.
9.13 Rules of Construction. The parties hereto agree that they have
been represented by counsel during the negotiation and execution of this
Agreement and, therefore, waive the application of any law, regulation, holding
or rule of construction providing that ambiguities in an agreement or other
document will be construed against the party drafting such agreement or
document.
9.14 Company Disclosure Letter. Disclosure made with regard to a
representation or warranty of the Company in the Company Disclosure Letter shall
also be deemed to qualify other representations and warranties of the Company if
it is readily apparent from the language contained in such disclosure that such
disclosure is applicable to such other representation or warranty.
9.15 Waiver Of Jury Trial. EACH OF THE COMPANY AND UHC HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE ACTIONS THE COMPANY OR UHC IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized respective officers as of the date first written above.
XXXXXXXX.XXX, INC.
By:_____________________________________
Name:___________________________________
Title:__________________________________
UNIVERSITY HEALTHSYSTEM CONSORTIUM
By:_____________________________________
Name:___________________________________
Title:__________________________________
[SIGNATURE PAGE TO COMMON STOCK PURCHASE AGREEMENT]
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SCHEDULE OF EXHIBITS
Exhibit A: Registration Rights Agreement Amendment
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EXHIBIT A
AMENDMENT NO. 1 TO
REGISTRATION RIGHTS AGREEMENT
This AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT dated January 25,
2001 (this "AMENDMENT") amends that certain Registration Rights Agreement, dated
as of June 30, 2000, by and among Xxxxxxxx.xxx, Inc., a Delaware corporation
(the "COMPANY"), and the Investors (the "PRIOR RIGHTS AGREEMENT"). The
capitalized terms not otherwise defined herein have the respective meanings
given to them in the Prior Rights Agreement.
RECITALS
WHEREAS, Section 7.1 of the Prior Rights Agreement states in part that any
term or provision of the Prior Rights Agreement may be amended by a writing
signed by the Company and the holders of a majority of the shares of the
Registrable Securities.
WHEREAS, the undersigned parties include the Company and the holders of a
majority of the shares of the Registrable Securities.
NOW, THEREFORE, in consideration of the mutual promises made herein and
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto agree to amend the Prior Rights
Agreement as follows:
1. Amendment of Section 1.7 of the Prior Rights Agreement. Section 1.7
of the Prior Rights Agreement is amended to add (i) the shares of Common Stock
issued to VHA pursuant to that certain Common Stock Purchase Agreement, dated as
of January 25, 2001, by and between the Company and VHA and (ii) the shares of
Common Stock issued to UHC pursuant to that certain Common Stock Purchase
Agreement, dated as of January 25, 2001, by and between the Company and UHC to
the definition of Registrable Securities. Section 1.7 shall read in its entirety
as follows:
"1.7 "REGISTRABLE SECURITIES" means shares of Common Stock of the
Company (i) issued or issuable upon conversion of the Preferred Stock (the
"CONVERSION STOCK") and (ii) issued or issuable with respect to, or in
exchange for or in replacement of the Conversion Stock or other
Registrable Securities, (iii) issued or issuable with respect to, or in
exchange for or in replacement of other securities convertible into or
exercisable for Preferred Stock upon any stock split, stock dividend,
recapitalization, or similar event, (iv) issued to the former stockholders
of Pharos Technologies, Inc., (the "PHAROS INVESTORS") in connection with
its acquisition by the Company, (v) issued to the former stockholders of
U.S. LifeLine, Inc. (the "USL INVESTORS") in connection with its
acquisition by the Company, (vi) issued to the former stockholders of
EquipMD, Inc., (the "EMI INVESTORS") in connection with its acquisition by
the Company, (vii) issued to, or issuable upon exercise of warrants issued
to, VHA, Inc., a Delaware corporation ("VHA") or University Healthsystem
Consortium, an Illinois corporation ("UHC") in connection with the
commercial agreement among Neoforma, Novation, LLC, a
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Delaware limited liability company ("NOVATION"), Healthcare Purchasing
Partners International, LLC, a Delaware limited liability company, VHA and
UHC, (viii) issued to VHA pursuant to that certain Common Stock Purchase
Agreement, dated as of January 25, 2001, by and between the Company and
VHA and (ix) issued to UHC pursuant to that certain Common Stock Purchase
Agreement, dated as of January 25, 2001, by and between the Company and
UHC (the shares of Common Stock of the Company (or other securities
convertible or exchangeable therefor) described in clauses (vii), (viii)
and (ix), the "NOVATION REGISTRABLE SECURITIES"), excluding: (A) any
shares of Common Stock that have been sold to or through a broker, dealer,
market maker or underwriter in a public distribution or a public
securities transaction or redeemed by the Company in accordance with its
Certificate of Incorporation, (B) any shares of Common Stock of the
Company (or Preferred Stock or other securities convertible or exercisable
therefor) that have been sold in violation of this Agreement, and (C) all
shares of Common Stock of the Company (or Preferred Stock or other
securities convertible or exchangeable therefor) described in clause (i),
(ii), (iii), (iv), (v), (vi), (vii), (viii) or (ix) of this Section 1.7
held by a Holder that can, in the opinion of counsel to the Company, be
sold by such Holder in a three-month period without registration under the
Securities Act pursuant to Rule 144."
2. All Other Terms Unchanged. Except as expressly modified by this
Amendment, all terms of the Prior Rights Agreement shall remain in full force
and effect.
3. Governing Law. This Amendment shall be governed by and construed
under the internal laws of the State of Delaware as applied to agreements among
Delaware residents entered into and to be performed entirely within Delaware,
without reference to principles of conflict of laws or choice of laws.
4. Counterparts. This Amendment may be executed in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
25
IN WITNESS WHEREOF, this Amendment has been executed as of the date first above
written.
COMPANY: INVESTORS (Entity):
XXXXXXXX.XXX, INC.
________________________________
(Printed Entity Name Here)
By:
Xxxxxx X. Xxxxxxxxxx By:_____________________________
Chief Financial Officer and Secretary
Name:___________________________
Title:__________________________
INVESTORS (Individual):
________________________________
Signature Here
________________________________
Printed Name Here
[SIGNATURE PAGE TO AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT]
26
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their duly authorized respective officers as of the
date first written above.
XXXXXXXX.XXX, INC.
By:______________________________________
Name:____________________________________
Title:___________________________________
UNIVERSITY HEALTHSYSTEM CONSORTIUM
By:______________________________________
Name:____________________________________
Title:___________________________________
[SIGNATURE PAGE TO UHC AMENDMENT TO AMENDED AND RESTATED
COMMON STOCK AND WARRANT AGREEMENT]
