EXHIBIT 10.1
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is dated as of June 1997,
by and among (i) WAKULLA MANOR, INC., a Florida corporation ("Company"), (ii)
WAKULLA ACQUISITION, INC., a Delaware corporation ("Acquisition"), (iii)
XXXXXX X. XXXXXX ("Xxxxxx") and XXXXXXXX X. XXXXXXXX ("Xxxxxxxx") (hereinafter
Xxxxxx and Xxxxxxxx are sometimes collectively referred to as "Guarantor"),
XXXXXX X. XXXXXXXX ("Xxxxxxxx"), C. XXX XXXXXX ("Xxxxxx"), and XXXXXXX X.
XXXXXXXX ("Franklin") (hereinafter Clarke, Cummings, Mitchell, Farmer, and
Franklin are sometimes referred to as "Sellers"), and (iv) NEWCARE HEALTH
CORPORATION, a Nevada corporation ( "Purchaser").
WITNESSETH:
WHEREAS, Acquisition owns 100% of the Company's common stock; and
WHEREAS, Sellers own 100% of the issued and outstanding shares of
Acquisition's common stock ("Common Stock") as follows:
Sellers Number of Shares
-------- ----------------
Xxxxx 100
Xxxxxxxx 100
Xxxxxxxx 100
Xxxxxx 100
Franklin 200
and
WHEREAS, Purchaser desires to purchase from Sellers all of Sellers'
Common Stock upon the terms and conditions set forth below:
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereby agree as follows:
ARTICLE I
THE PURCHASE
SECTION 1.1. Purchase of Common Stock. On the terms and subject to the
conditions herein expressed, and simultaneously with the execution of this
Agreement, Sellers hereby sell, convey and transfer to Purchaser all of
Sellers' right, title, and interest in and to 600 shares of the Common Stock,
which shares constitute one hundred percent (100%) of the issued and
outstanding shares of the stock of Acquisition and Purchaser hereby purchases
from Sellers said shares of stock for the purchase price set forth herein
below.
SECTION 1.2. Purchase Price and Deposit. The total purchase price for the
stock to be paid by Purchaser is $1,200,000, which shall be payable on a pro
rata stock ownership basis to Sellers at Closing. Contemporaneous with the
execution of this Agreement, Purchaser shall deliver a nonrefundable xxxxxxx
money deposit in the amount of $50,000 in cash to be payable to Seller's
Counsel, Xxxxxx & XxXxxxxx, P.A., which shall be credited to the Purchase
Price at Closing.
SECTION 1.3. Closing. The sale contemplated hereby shall be consummated
on the closing date designated by Purchaser (the "Closing Date"), but in no
event later than July 31, 1997. The closing shall occur at the offices of
Purchaser or Purchaser's counsel in Atlanta, Georgia on the Closing Date. On
the Closing Date, the purchase and sale shall take place as follows, subject
to all the terms and conditions of this Agreement:
(a) Sellers shall execute and deliver a Xxxx of Sale with
accompanying stock certificates conveying all of Sellers' right, title and
interest in and to the stock, free and clear of all liens, security interests,
claims, restrictions, and any other encumbrances whatsoever, in a form
reasonably acceptable to Purchaser.
(b) To the extent not contained in the Xxxx of Sale, Sellers shall
execute and deliver to Purchaser such documents as are necessary to convey to
Purchaser all rights necessary for the use and enjoyment of Sellers' rights in
the Company.
(c) Sellers shall deliver to Purchaser a written opinion,
satisfactory to Purchaser, dated as of the Closing Date from counsel for
Sellers to the effect that:
(i) Company, Acquisition, Sellers and Guarantor have full power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby.
(ii) The individuals that have executed this Agreement have the
authority to so execute this Agreement on behalf of Acquisition and Sellers.
(iii) Sellers have taken all requisite action to authorize,
approve and carry out this Agreement and the transactions on the part of
Sellers, Company and Acquisition contemplated hereby, and this Agreement
constitutes a legal, valid and binding agreement of Sellers except to the
extent limited by bankruptcy, insolvency, reorganization, moratorium and other
laws of general application relating to or affecting the enforcement of
creditors' rights.
(iv) The consummation of the transactions on the part of
Sellers, Acquisition, and Company contemplated by this Agreement, does not
require the consent, approval, authorization or order, giving of notice to, or
the registration with, any court or any Federal, state, or other governmental
authority, agency or instrumentality or any other person.
(v) To such counsel's knowledge, no action or proceeding
against Sellers, Acquisition or Company is pending before any court, or before
or by any governmental body, to restrain, prohibit, invalidate or obtain
damages with respect to, or otherwise question or attack the transactions
contemplated by this Agreement and to the best of such counsel's knowledge,
neither Sellers nor Company is involved in any litigation which might have an
adverse effect on the property of the Company.
(d) Sellers shall deliver to Purchaser a Reaffirmation, as of the
Closing Date, of the representations and warranties set forth in Article II
hereof.
(e) Sellers shall execute and deliver to Purchaser an any other
documents and certificates which may be reasonably requested by Purchaser and
which are customarily executed in connection with similar transactions.
SECTION 1.4. Additional Agreements. In addition to the transfers
contemplated by this Agreement, Clarke, Cummings, Mitchell, Farmer, and
Franklin each covenant and agree to resign as employees, officers and
directors of the Company, Acquisition, and all Company Subsidiaries, without
payment of any compensation other than as contained in this Agreement.
SECTION 1.5. Pre-Closing Revenues and Liabilities. All revenues, rents,
other items of income accruing to the Company in the ordinary course of their
business activities and other assets listed on Exhibit I preceding the Closing
Date and any proceeds derived therefrom and received thereafter by the Company
shall be separately accounted for by the Company listed on Exhibit I (the
"Company's Revenues"). All expenses, liabilities and other debts or charges of
the Company existing, arising or accruing as of the Closing Date (the
"Company's Liabilities"), including, without limitation, all items listed on
Exhibit 11 shall become the obligations of the Sellers and Guarantor and are
hereby covered by Article 111 herein. As of midnight on the date immediately
preceding the Closing Date, a listing of such Company's Liabilities (the
"Preliminary Liabilities List") shall be prepared by Sellers and provided to
Purchaser.
At the Closing Date the Sellers will establish an Escrow Account with
their Counsel, Xxxxxx & XxXxxxxx, P.A. of Tallahassee, Florida, which may be
used to discharge excess Company's Liabilities upon final settlement one
hundred and eighty (180) days after the Closing Date. The Escrow balance will
be equal to the amount that Sellers Liabilities (Preliminary Liabilities List)
exceed Company's Revenues as of the Closing Date or $200,000, whichever is
higher. For this computation of the initial Escrow balances the total of
Company's accounts receivable shall be reduced by 20% (one-fifth) of patient
accounts receivable, subject to confirmation by the reasonable and timely due
diligence of Purchaser.
The Company shall receive revenues and other items of income accruing to
the Sellers (Company's Revenues) after the Closing Date. The Company will pay
and discharge the Company's Liabilities (Preliminary Liabilities List) from
the receipt of Company's Revenues after the Closing Date. One hundred and
eighty (180) days after the Closing Date, the Company shall provide to Seller
an accounting showing the then Company's Revenues and the then current
Company's Liabilities. Company's Revenues shall be reduced by 50% (one-half)
of any patient accounts receivables remaining to determine the total Adjusted
Company's Revenues. On the one hundred and eightieth (180th) day following the
Closing Date, Sellers may request from the Escrow Account the positive net
difference, if any, of the then current Company's Adjusted Revenues in excess
of the then current Company's Liabilities. Likewise on the one hundred and
eightieth (180th) day following the Closing Date, the Company may request from
the Escrow account the positive net difference, if any, of the then current
Company's Liabilities in excess of the then current Company's Adjusted
Revenues.
Thereafter, the Sellers and the Company agree to continue to deliver to
each other such amounts as may be necessary to comply with the intent of this
Section 1.5.
ARTICLE 11
REPRESENTATIONS AND WARRANTIES
SECTION 2.1. Representations and Warranties by the Sellers and Guarantor.
Sellers and Guarantor, jointly and severally, represent and warrant to, and
agree with, Purchaser as follows:
(a) Organization and Qualification of the Company and Acquisition.
Company and Acquisition are corporations duly incorporated, validly existing
and in good standing, under the laws of the States of Florida and Delaware,
respectively, and have all requisite corporate power and corporate authority
to own or lease and operate its properties and assets and to carry on its
business as, and in the places where, such properties and assets are now owned
or leased and operated and such business is now being conducted. Attached
hereto as Schedule 2.1(a) are true and complete copies of the Company's and
Acquisition's Articles of Incorporation and Bylaws as amended.
(b) Company Subsidiaries. Except as listed on Schedule 2.1(b), the
Company has no Company Subsidiaries. For purposes of this Agreement, the term
"Company Subsidiary" shall mean any corporation or other business entity of
which the Company and/or one or more other Company Subsidiaries owns a
majority of the outstanding voting stock entitled to vote for the election of
directors or an equivalent equity interest.
(c) Capitalization of the Company. The authorized Capital stock of
the Company consists of 1000 shares of Common Stock of which 600 shares are
validly issued and outstanding, all of which are fully paid and nonassessable
and free of preemptive rights. There are no outstanding options, warrants,
convertible securities or other rights, agreements, arrangements or
commitments obligating the Company or Sellers to issue or sell any shares of
capital stock of the Company. No dividends have been declared with respect to
any shares of the Company's capital stock which have not been paid.
(d) Authority Relative to Agreement: Non-Contravention. The Company
has all requisite corporate power and corporate authority to enter into this
Agreement, and to perform its obligations hereunder. This Agreement has been
duly executed and delivered by the Company, Sellers and Guarantor and (i) will
constitute valid and binding obligations of the Company, Sellers and
Guarantor, enforceable against the Company, Sellers and Guarantor in
accordance with its terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization, fraudulent conveyance or other laws
relating to or affecting the enforcement of creditors' rights or the
collection of debtors' obligations in general or by general equitable
principles, and (ii) will not (A) conflict with any provision of the Articles
of Incorporation or Bylaws of the Company or Sellers or (B) result in any
violation of or default under, or permit the acceleration of any obligation
under, any material mortgage, indenture, lease, agreement or other instrument,
permit, concession, grant, franchise, license, judgment, order, decree,
statute, law, ordinance, rule or regulation applicable to the Company or its
properties or any material agreement or understanding between any
administrative or regulatory authority, on the one hand, or any rules or
regulations of any trade association or organization of which the Company is a
member.
(e) Financial Statements. Attached hereto as Schedule 2.1(c) are
true, correct and complete copies of the Company's and the Company
Subsidiaries' financial statement for the period ended April 30, 1997 (the
"Financial Statements"). The Financial Statements have been prepared in
accordance with generally accepted accounting principles applied on a
consistent basis (except as may be expressly stated therein or in the notes
thereto) and fairly present the financial position of the Company (and each
Company Subsidiary, as applicable) at the date thereof and the results of its
operations and its cash flow for the period then ended. The Financial
Statements were prepared from books and records of the Company (and each
Company Subsidiary, as applicable), which accurately and fairly reflect all
the transactions of, acquisitions and dispositions of assets by, and
incurrence of liabilities by, the Company (and each Company Subsidiary, as
applicable). The Financial Statements contain all material liabilities or
material obligations that were, as of April 30, 1997, required to be accrued,
reserved against or otherwise disclosed in the Financial Statements under
generally accepted accounting principles.
(f) Accounts Receivable. All accounts receivable are reflected on
the Company's (and each Company Subsidiary's, as applicable) records and
Financial Statements and arose from bona fide transactions in the ordinary
course of business. Such accounts receivable will be collectible at their
aggregate balance, with allowance for doubtful accounts on the Company's (and
each Company Subsidiary's, as applicable) books and records (which has been
determined in accordance with generally accepted accounting principles and
historical practices) in the ordinary course of business without resort to
litigation, and will not in the aggregate be subject to any material
counterclaims, set-offs or other reductions.
(g) No Default or Litigation
(i) The business of the Company and the Company Subsidiaries is
being conducted in compliance with, and the Company has made (or has caused to
be made) all material filings required by, the laws, orders, regulations,
policies and guidelines of all applicable governmental entities (including,
without limitation, applicable laws, orders and regulations relating to labor
relations or environmental protection);
(ii) The Company and/or the Company Subsidiaries are not in
default under the terms of any outstanding contract, agreement, lease or other
commitment and there does not currently exist under any such contract,
agreement, lease or commitment any condition or event that, with notice or
lapse of time or both, would constitute a default;
(iii) There are no actions at law, suits in equity,
administrative proceedings or claims pending or, to their knowledge,
threatened against or affecting the Company, the Company Subsidiaries, or
their properties and, to their knowledge, there is no basis for any such
action, proceeding or claim;
(iv) The Company and/or the Company Subsidiaries have not been
charged by any governmental entity with any violation of, or threatened by any
governmental entity with a charge or any violation of. any applicable law,
order or regulation; and
(v) The Company and/or the Company Subsidiaries are not subject
to any judgment, order, writ, injunction, decree or award of any court,
arbitrator or governmental department, agency, board, bureau or
instrumentality issued or entered in a proceeding to which the Company or a
Company Subsidiary is or was a party which is binding upon the Company or a
Company Subsidiary, including, without limitation, any uncorrected license
deficiencies, restrictions or limitations related to the operation of Wakulla
Manor Nursing Home, a 120-bed skilled nursing facility located at 0000
Xxxxxxxxxxxxx Xxxxxxx, Xxxxxxxxxxxxx, Xxxxxxx (the "Facility").
(h) Licenses, Permits and Authorizations. The Company and the
Company Subsidiaries have validly and legally obtained and duly hold all
approvals, licenses or other permits of all governmental or regulatory
agencies, whether federal, state or local, which are required for the
operations of their business as it is presently being conducted, including
without limitation, all licenses, permits and approvals necessary for the
lawful operation of the Facility.
(i) Taxes. All tax returns, reports and forms required to be filed
by or on behalf of the Company and/or the Company Subsidiaries and Acquisition
with respect to any income, properties or operations of the Company and/or the
Company Subsidiaries and Acquisition with any taxing authority have been
timely filed, and all taxes owed by the Company and the Company Subsidiaries
and Acquisition have been or will be timely paid prior to Closing. Neither the
Company nor any of the Company Subsidiaries nor Acquisition have consented to
the extension of the applicable statute of limitation with respect to any
federal, state or local income, franchise, property or other tax. There is no
action, suit, proceeding, investigation, audit or claim now pending against,
nor has any claim for additional tax or assessment been asserted by any taxing
authority relating to the Company or any of the Company Subsidiaries nor
Acquisition, nor are there any agreements for the extension of the time for
the assessments of any taxes of the Company or any of the Company Subsidiaries
or Acquisition with respect to any income, properties or operations of the
Company or any Company Subsidiary or Acquisition. Neither the Company nor any
of the Company Subsidiaries nor Acquisition have filed any agreement or
consent under Section 341(f) of the Internal Revenue Code of 1986, as amended
(the "Code"). There are no liens for federal, state or local income or
property taxes upon the assets of the Company or any of the Company
Subsidiaries or Acquisition except liens for current federal, state and local
taxes not yet due.
(j) Labor Controversies. Neither the Company, Acquisition, nor any
of the Company Subsidiaries are a party to any collective bargaining agreement
with respect to any employees of the Company, Acquisition, or the Company
Subsidiaries. There are no labor controversies presently pending or threatened
against the Company, Acquisition, or any of the Company Subsidiaries which may
reasonably be expected to adversely affect the business or financial condition
of the Company, Acquisition, or any of the Company Subsidiaries.
(k) Employee Benefit Plans.
(i) Employee Welfare Benefit Plans. There is no "employee
welfare benefit plan" (as defined in Section 3(1) of the Employment Retirement
Income Security Act of 1974 ("ERISA")) maintained by the Company or any
corporate or other trade or business under common control of the Company,
within the meaning of Section 414 of the Code (hereinafter an "Affiliate") or
to which the Company, or any Affiliate thereof, contributes or is required to
contribute (such plans being hereinafter collectively referred to as "Employee
Welfare Benefit Plans") for employees or for former employees of the Company.
(ii) Employee Pension Benefit Plans. There is no "employee
pension benefit plan" (as defined in Section 3(2) of ERISA) maintained by the
Company or any Affiliate, and there is no such plan to which the Company or
any Affiliate contributes, is required to contribute or has contributed (such
employee benefit plans being hereinafter collectively referred to as the
"Employee Pension Benefit Plans"). The Company and any Affiliate do not
maintain or contribute to any pension plan (including any multi-employer
pension plan as defined in Section 3(37) of ERISA) which is subject to the
provision of Part 3 of Title I or Title IV of ERISA.
(iii) Other Tax Qualified Plans. Neither the Company, nor any
Affiliate, maintains any tax qualified plans within the meaning of Section 401
of the Code.
(iv) Certain Severance Arrangements. Neither the Company, nor
any Affiliate, is a party to or obligated under any agreement, plan, contract
or other arrangement pursuant to which the Company, or any Affiliate or the
Purchaser is or might be required to make payments that would not be
deductible or capitalizable for federal income tax purposes by reason of the
application of Section 280G of the Code. Further, the consummation of the
transactions contemplated by this Agreement will not by their occurrence
result in any employee becoming entitled to severance payments from the
Company.
(v) Health Care Continuation Coverage. The Company and any
Affiliates have complied with the requirements of Section 162(k) of the Code
regarding continuation of health care coverage under any group health plans.
(vi) No Other Liabilities. As of the Closing Date, there are no
material liabilities (in excess of $5,000.00 individually or $25,000.00 in the
aggregate), absolute or contingent, of the Company, any Company Subsidiary, or
of any employee, officer, director or any person which may have indemnity
rights or contributions rights or other recourse against the Company or any
Company Subsidiary with respect to any employee benefit plan, program,
practice, arrangement, agreement or understanding, whether written or oral,
except for liabilities which have been fully accrued on the Company's (and
each Company Subsidiary, as applicable) financial statements.
(1) Compliance with Environmental Laws. Neither the Company nor any
of the Company Subsidiaries have received any notification from a governmental
agency that there is any past, present or continuing violation of any
environmental laws, environmental ordinances, environmental regulations or
environmental rules with respect to the business or properties of the Company
and/or the any of the Company Subsidiaries and such business and the use of
such properties conform in all material respects to all applicable
environmental laws, environmental ordinances, environmental regulations and
environmental rules. Notwithstanding anything to contrary contained herein,
Purchaser's obligations hereunder are subject to the receipt by Purchaser
prior to Closing of a Phase I environmental report satisfactory to Purchaser
in its sole discretion.
(m) Intellectual Property. Schedule 2.1(d) to this Agreement sets
forth a complete and correct list of each patent, patent application,
trademark (whether or not registered), trademark application, trade name,
service xxxx, copyright and proprietary intellectual property (including,
without limitation, proprietary computer software, whether in object or source
form) (collectively, "Intellectual Property") owned, used or licensed by the
Company or any Company Subsidiary and a description of whether such
Intellectual Property is owned or licensed by the Company and/or any Company
Subsidiary. To their knowledge, the Company and/or the Company Subsidiary has
the right to use such Intellectual Property and the current use by the Company
or the Company Subsidiary of such Intellectual Property does not infringe upon
the rights of any other person. To their knowledge, no other person is
infringing upon the right of the Company or any Company Subsidiary in any such
Intellectual Property where such infringement may have a material adverse
effect on the Company or any Company Subsidiary.
(n) Title to Properties; Absence of Liens and Encumbrances, Etc. All
real property owned by the Company or any Company Subsidiary and all real and
personal property leased to the Company or any Company Subsidiary are
described in Schedule 2.1(e) hereof. The Company and each of the Company
Subsidiaries has good ,and marketable title to all its properties and assets,
real, personal and mixed, used in its business, including without limitation
to the Facility, free and clear of any liens, charges, pledges, security
interests or other encumbrances, except for liens with respect to (A) those
items shown on Schedule 2.1(e) hereto, (B) statutory liens arising or incurred
in the ordinary course of business with respect to the underlying obligations
are not delinquent and (C) liens for taxes not yet due for the current year.
All leases under which the Company or a Company Subsidiary is the lessee of
any real or personal property are valid and binding on the lessors thereunder
in accordance with their respective terms and there is not under any of such
leases any existing default, or any condition, event or act which with notice
or lapse of time or both would constitute such a default.
(o) Contracts and Commitments. Except as set forth on Schedule 2.
l(f), neither the Company nor any Company Subsidiary is a party to, or subject
to any liabilities arising from:
(i) any management or employment contract, special termination
agreement or other contract for personal services with an officer, consultant,
director, employee or other person that is not terminable by the Company or a
Company Subsidiary on not more than one month's notice without penalty;
(ii) any contract to sell goods or any contract to purchase
goods which exceeds $5,000 in price;
(iii) any plan, contract, or arrangement providing for bonuses,
pensions, deferred compensation, retirement plan payments, profit sharing,
incentive pay, or for any other employee benefits;
(iv) any agreement providing for liability for severance pay,
collective bargaining agreements, labor contracts, or labor or personnel
policies;
(v) any contract, agreement, or instrument evidencing or
relating to any outstanding indebtedness for borrowed money or the deferred
purchase price of property, or any direct or indirect guarantee of any such
indebtedness or deferred purchase price.
(vi) any agreement that restricts the right of the Company or
any Company Subsidiary to engage in any place, in any line of business,
solicit employees or customers or otherwise compete in any line of business;
(vii) any contract, commitment, or agreement that involves (A)
capital expenditures by the Company or any Company Subsidiary or (B) the
disposition of any assets of the Company or any Company Subsidiary reflected
in the Financial Statements not in the ordinary course of business consistent
with past prices;
(viii) any contract, commitment, or agreement between (A) the
Company or any Company Subsidiary and (B) any shareholder, officer or director
(or any of their affiliates) of the Company or any Company Subsidiary;
(ix) any partnership agreement in which the Company or any
Company Subsidiary is a partner;
(x) any joint venture contract or arrangement or any other
agreement that involves a sharing of profits.
Complete and correct copies (in the case of any of the foregoing that are
in writing) or descriptions (in the case of any of the foregoing that are not
in writing) of each of the foregoing have been delivered to Purchaser. Each of
the foregoing is in full force and effect and neither the Company nor any
Company Subsidiary is in default with respect to any of the foregoing and has
not been notified or advised by any party to any of the foregoing of such
party's intention or desire to terminate or modify in any respect any of the
foregoing.
(p) Insurance. The properties of the Company and the Company
Subsidiaries, including without limitation, the Facility, are insured under
valid and enforceable policies issued by insurers of recognized responsibility
against all risks usually insured against by persons operating similar
properties in the localities where such properties are located. Copies of each
of the foregoing insurance policies will be delivered to Purchaser prior to
the Closing Date. Sellers shall be entitled to any refund of insurance
premiums paid (for property, liability, casualty and workers' compensation)
prior to the Closing Date for coverage after the Closing Date.
(q) Absence of Certain Changes. Since neither the Company nor any of
the Company Subsidiaries have suffered any material adverse change in its
financial condition, assets, liabilities, business, business prospects, or
operations, incurred any indebtedness, incurred any other obligations or
liabilities, paid any dividends or made any other distribution in respect of
its capital stock, or made any payments or loans to any affiliate.
(r) Accounts Payable. All accounts payable are reflected on the
Company's (and each Company Subsidiary's, as applicable) records and Financial
Statements and arose from bona fide transactions in the ordinary course of
business.
SECTION 2.2. Representations and Warranties by Purchaser. Purchaser
represents and warrants to, and agrees with, Sellers as follows
(a) Organization of Purchaser. Purchaser is a corporation duly
incorporated, validly existing and in good standing, under the laws of the
State of Nevada and has all requisite corporate power and corporate authority
to own or lease and operate its properties and assets and to carry on its
business as, and in the places where, such properties and assets are now owned
or leased and operated and such business is now being conducted.
(b) Authority Relative to Agreement; Non-Contravention. Purchaser
has all requisite corporate power and corporate authority to enter into this
Agreement, and to perform its obligations hereunder. This Agreement has been
duly executed and delivered by Purchaser and (i) will constitute valid and
binding obligations of Purchaser, enforceable against Purchaser in accordance
with its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance or other laws
relating to or affecting the enforcement of creditors' rights or the
collection of debtors' obligations in general or by general equitable
principles, and (ii) will not (A) conflict with any provision of the Articles
of Incorporation or Bylaws of Purchaser or (B) result in any violation of or
default under, or permit the acceleration of any obligation under, any
material mortgage, indenture, lease, agreement or other instrument, permit,
concession, grant, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to Purchaser or its properties or any
material agreement or understanding between any administrative or regulatory
authority, on the one hand, or any rules or regulations of any trade
association or organization of which Purchaser is a member.
(c) Purchaser shall be required to acquire property, liability,
casualty and workers' compensation insurance coverages comparable to Company's
prior to closing to be effective as of the Closing Date.
(d) Purchaser shall not make any election under IRC Section 338.
ARTICLE III
INDEMNITY
Indemnification by the Sellers and Guarantors. Sellers and Guarantor,
jointly and severally, hereby agree to indemnify, defend and hold harmless
Purchaser and the Company (including without limitation its officers,
directors, agents and employees) from and against all demands, claims, actions
or causes of action, assessments, losses, damages, liabilities, costs and
expenses, including without limitation, interest, penalties and reasonable
attorney's fees and expenses asserted against, resulting to, imposed upon or
incurred by Purchaser or the Company (including its officers, directors,
agents and employees) by reason of or as a result of (i) any breach of or
misrepresentation or omission in any representation or warranty contained
herein; and (ii) any breach by Sellers or Guarantor of any agreement entered
into or in any certificate furnished to Purchaser in connection with this
Agreement, for a period of three (3) years from the Closing Date. If any
action or suit is instituted against Purchaser by reason of, or in connection
with, any claim against or liability of Sellers, of whatsoever kind or nature,
not specifically assumed by Purchaser in this Agreement, then and in such
event, Purchaser, upon being duly served with process, shall give notice to
Sellers of the institution of such action, and in any such action, Sellers
shall have the option to defend the same at their own expense, and pay any
judgment entered therein, but Purchaser shall in such case have the right, if
it so chooses, to participate in any such action or suit with counsel of its
own selection at its own expense.
ARTICLE IV
MISCELLANEOUS
SECTION 4.1. Brokers. Each party hereto represents and warrants to all
other parties that no broker, finder or investment banker is entitled to any
brokerage, finder's or other fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf
of such party.
SECTION 4.2. Expenses. All costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby (including legal,
accounting, investment advisory and other such costs) shall be paid by the
party incurring such expenses; provided, however, Sellers (not the Company)
shall pay for all expenses relating to Sellers hereunder.
SECTION 4.3. Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if sent by registered or
certified mail, postage prepaid, addressed as follows:
If to Sellers or Guarantor:
000 Xxxxx Xxxx Xxx
Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxx Xxxxxxxx
With a copy to: Xxxxxx X. Xxxxxxxx, CPA
Xxxxxxxx & Company
0000 Xxxxxxxxx Xxxxx Xxxxxx, Xxxxx X
Xxxxxxxxxxx, Xxxxxxx 00000
If to Purchaser: 0000 Xxxx Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: General Counsel
or such other address as shall be furnished in writing by any party to the
others prior to the giving of the applicable notice or communication.
SECTION 4.4. 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 instrument.
SECTION 4.5. Headings. The headings herein are for convenience of
reference only, do not constitute a part of this Agreement, and shall not be
deemed to limit or affect the provisions hereof.
SECTION 4.6. Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof, and
supersedes all prior agreements and negotiations.
SECTION 4.7. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the substantive laws of the State of Florida,
without regard to conflicts of laws principles.
SECTION 4.8. Assignment. Purchaser may not assign any of its right,
title, and interest in and to this Agreement without the consent of Sellers,
not to be unreasonably withheld or delayed, except that Purchaser may assign
this Agreement to any entity under common control with Purchaser, where
Purchaser has majority control of the assignee or where Purchaser or
Purchaser's largest shareholder controls the assignee, without the consent of
Sellers. Upon any such assignment Purchaser shall be relieved from all
liability for the performance of each and every term, condition,
representation, warranty, covenant in and of this Agreement that is or may be
applicable to Purchaser. In the event of any such assignment, this Agreement
shall automatically be deemed amended to cover and take into account such
assignee as the Purchaser. Neither Sellers nor Guarantor may assign any of its
right, title or interest in and to this Agreement without the consent of
Purchaser, which may be withheld in Purchaser's sole discretion.
SECTION 4.9. Survival of Representations, Warranties and Agreements. All
covenants, representations, warranties and agreements made hereunder or
pursuant hereto or in connection with the transactions contemplated hereby
shall survive the closing of the transactions contemplated hereby, the
delivery of any instruments or documents pursuant hereto, and shall remain
effective regardless of any investigation made by any party at any time, for a
period of three (3) years following the Closing Date.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed under seal as of the date first above written.
Sellers:
Wakulla Acquisition, Inc.
By:/s/ Xxxxxxx X. Xxxxxxxx
Title: President
Attest:/s/ Xxxxxx X. Xxxxxxxx
Title: Secretary
[CORPORATE SEAL]
Guarantor and Shareholders:
/s/ Xxxxxx X. Xxxxxx
/s/ Xxxxxxxx X. Xxxxxxxx
Shareholders:
/s/ Xxxxxx X. Xxxxxxxx
/s/ C. Xxx Xxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
Company:
Wakulla Manor, Inc.
By:/s/ Xxxxxxx X. Xxxxxxxx
Title President
Attest:/s/ Xxxxxx X. Xxxxxxxx
Title: Secretary
[CORPORATE SEAL]
Purchaser:
NewCare Health Corporation
By:/s/ Xxxxx X. Xxxxxxxxx
Title: President
Attest:/s/ Xxxxxx X. Xxxx
Title: Secretary
[CORPORATE SEAL]
FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT is dated as of July 24,
1997, by and among (i) WAKULLA MANOR, INC., a Florida corporation ("Company"),
(ii) WAKULLA ACQUISITION, INC., a Delaware corporation ("Acquisition"), (iii)
XXXXXX X. XXXXXX ("Xxxxxx") and XXXXXXXX X. XXXXXXXX ("Xxxxxxxx") (hereinafter
Xxxxxx and Xxxxxxxx are sometimes collectively referred to as "Guarantor"),
XXXXXX X. XXXXXXXX ("Xxxxxxxx"), C. XXX XXXXXX ("Xxxxxx"), and XXXXXXX X.
XXXXXXXX ("Franklin") (hereinafter Clarke, Cummings, Mitchell, Farmer, and
Franklin are sometimes referred to as "Sellers"), and (iv) NEWCARE NURSING
CORPORATION, a Georgia corporation ("Purchaser"), as assignee of NEWCARE
HEALTH CORPORATION, a Nevada corporation.
W I T N E S S E T H:
WHEREAS, the parties have entered into that certain Stock Purchase
Agreement dated as of June, 1997 (the "Stock Purchase Agreement");
WHEREAS, Sellers have requested that the Closing Date (as defined in the
Stock Purchase Agreement) be extended from July 31, 1997 to no later than
August 31, 1997;
WHEREAS, Purchaser is willing to extend the Closing Date to no later than
August 31, 1997 subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereby agree as follows:
1. Amendment to Stock Purchase Agreement. Section 1.3 of the Stock
Purchase Agreement is hereby amended by deleting the date "July 31, 1997" and
inserting in lieu thereof the date "August 31, 1997."
2. Condition to Closing. Sellers acknowledge and agree that the only
condition to Sellers' obligation to close the sale of Acquisition's Common
Stock contemplated by the Stock Purchase Agreement is obtaining a court order
in the case of Xxxxxxxx X. Xxxxxxxx. United States Bankruptcy Court for the
Southern District of Florida. Case No. 96-33413-BKC-SHF authorizing and
approving the sale of Xxxxxxxx' shares of Acquisition's Common Stock to
Purchaser on the terms and conditions set forth in the Stock Purchase
Agreement, as amended hereby? and the running of any applicable notice period
to creditors required by law or by such court order. Sellers agree to seek in
good faith to obtain the court order referred to in the preceding sentence.
3. Reaffirmation of the Stock Purchase Agreement. Except as expressly
amended hereby, Sellers and Purchaser ratify and confirm the terms and
conditions of the Stock Purchase Agreement.
4. Deposit. This First Amendment to Stock Purchase Agreement and the
Stock Purchase Agreement shall be null and void if Purchaser has not delivered
the $50,000.00 deposit required by Section 1.2 of the Stock Purchase Agreement
to Sellers' counsel, Xxxxxx & XxXxxxxx, P.A., within two (2) business days
after Purchaser receives Sellers' fully executed counterpart to this
Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed under seal as of the date first above written.
COMPANY:
WAKULLA MANOR, INC., a Florida corporation
By: /s/ Xxxxxxx X. Xxxxxxxx
President
Attest: /s/ Xxxxxx X. Xxxxxxxx
Secretary
[CORPORATE SEAL]
SELLERS:
WAKULLA ACQUISITION, INC., a Delaware
corporation
By: /s/ Xxxxxxx X. Xxxxxxxx
President
Attest: /s/ Xxxxxx X. Xxxxxxxx
Secretary
[CORPORATE SEAL]
GUARANTOR AND SHAREHOLDERS:
/s/ Xxxxxx X. Xxxxxx
/s/ Xxxxxxxx X. Xxxxxxxx
SHAREHOLDERS:
/s/ Xxxxxx X. Xxxxxxxx
/s/ C. Xxx Xxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
NEWCARE NURSING CORPORATION,
a Georgia Corporation
By: /s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: President
