Exhibit(c)(4)
AMENDMENT NO. 1 TO THE
AGREEMENT AND PLAN OF REORGANIZATION
This Amendment No. 1, dated as of June 6, 1997 (this "Amendment"), is
hereby entered into by and among VSP Holdings, Inc., a Delaware corporation (the
"Acquiror"), VSP Acquisition, Inc., a Delaware corporation and a wholly owned
subsidiary of Acquiror (the "Merger Sub"), VSP Holdings II, Inc., a Delaware
corporation ("Acquiror II"), Vivra Specialty Partners, Inc., a Nevada
corporation (the "Company"), and Vivra Incorporated, a Delaware corporation (the
"Parent"), to amend certain terms and conditions of the Agreement and Plan of
Reorganization, dated as of May 5, 1997 (the "Agreement"), by and among
Acquiror, Merger Sub, Acquiror II, the Company, and Parent. Capitalized terms
used but not defined herein shall have the meanings ascribed to such terms in
the Agreement.
WHEREAS, the parties to the Agreement desire to amend certain terms
and conditions of the Agreement; and
WHEREAS, pursuant to Section 10.2 of the Agreement, the parties may
amend the Agreement pursuant to an instrument in writing signed by all of the
parties to the Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by
the parties hereto, the parties hereby agree as follows:
Capitalization of Acquiror. Acquiror has amended its certificate
of incorporation to consolidate Acquiror Class A Common Stock and Acquiror Class
B Common Stock into a single class of common stock, par value $.01 per share, of
Acquiror (the "Acquiror Common Stock"). The parties hereto hereby agree that,
for all purposes in the Agreement, all references to shares of Acquiror Class A
Common Stock and Acquiror Class B Common Stock shall be deemed to refer to
shares of Acquiror Common Stock.
Amendment to Section 1.02 of the Agreement. Section 1.02 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 1.02 VHI Acquisition. Immediately prior to the consummation
of the Merger, the Company will sell and transfer to Acquiror II all
of the outstanding capital stock of Vivra Heart Imaging, Inc., a
Nevada corporation ("VHI"), owned by the Company in exchange for a
payment in cash by Acquiror II to the Company of an aggregate amount
equal to $488,435.00 (the "VHI Consideration"). The foregoing
transaction shall hereinafter be referred to as the "VHI Acquisition"
and, together with the Merger, the "Transactions.""
Amendment to Section 1.03 of the Agreement. Section 1.03 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 1.03 Closing. Subject to the satisfaction or waiver of the
conditions set forth herein, the closing of the Transactions (the
"Closing"), shall take place on June 6, 1997 at 9:00 a.m. (San
Francisco time) at the offices of
Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP, Xxxxx Street Tower, One Market, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, or at such other time and place as the
parties shall designate in writing (the "Closing Date")."
Amendment to Section 1.06 of the Agreement. Section 1.06 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 1.06 Certificate of Incorporation; Bylaws. At the Effective
Time, the Articles of Incorporation and Bylaws of the Surviving
Corporation, each as in effect immediately prior to the Effective
Time, shall be the Articles of Incorporation and Bylaws of the
Surviving Corporation until thereafter amended as provided by Nevada
Law, the Articles of Incorporation and the Bylaws."
Amendment to Section 1.08 of the Agreement. Section 1.08 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 1.08 Conversion of Shares. Subject to any adjustment to
such terms pursuant to Section 1.12, at the Effective Time, (a) each
share of Common Stock outstanding immediately prior to the Effective
Time (other than any Dissenting Shares (as hereinafter defined), any
shares of Common Stock held by Acquiror, and shares of Common Stock
which are exchanged for Acquiror Common Stock pursuant to Section
5.09(a) herein) shall automatically and without any action on the part
of the holder thereof, upon surrender of the certificate that formally
evidenced such Common Stock in the manner provided herein, be
cancelled and shall be converted automatically into the right to
receive an amount payable in cash, without interest, equal to
$1.08880483 per share of Common Stock (such amount payable per share
of Common Stock in the Merger being referred to herein as the "Merger
Consideration"), (b) each share of Common Stock outstanding
immediately prior to the Effective Time held by Acquiror shall be
cancelled for no consideration, and (c) each share of common stock,
$0.01 par value per share, of Merger Sub shall be converted into one
share of common stock of the Surviving Corporation. Notwithstanding
the foregoing, in the event that options (the "Vivra Options") to
acquire Parent common stock, par value $0.01 per share (the "Vivra
Common Stock"), are cancelled pursuant to the last sentence of Section
5.09(a) in connection with the Vivra Option Exchange (as defined in
Section 5.09(a)), the Merger Consideration shall be decreased by an
amount equal to the quotient obtained by dividing (i) the Gross Spread
(as defined below) by (ii) the actual number of shares of Common Stock
outstanding immediately prior to the Merger (after giving effect to
the exchanges contemplated by Section 5.09(a)) (the "Post-Adjustment
Merger Consideration"). For the purposes of the preceding sentence,
(i) the Gross Spread for the Vivra Options cancelled in the Vivra
Option Exchange shall be equal to the product of (x) the difference
between $35.62 and the weighted-average per share exercise price of
such Vivra Options and (y) the number of shares of Vivra Common Stock
covered by such cancelled Vivra Options, and (ii) the aggregate Gross
Spread for all Vivra Options cancelled in the Vivra Option Exchange
shall not exceed $4,837,382.00."
Amendment to Section 1.09 of the Agreement. Section 1.09 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 1.09 Stock Options.
(a) Each stock option (and any related rights) to purchase
capital stock of any of the VSP Reorganization Entities (as
hereinafter defined) granted under stock option plans of the VSP
Reorganization Entities outstanding prior to the consummation of
the Reorganization (as hereinafter defined) (each, a "VSP
Reorganization Entity Option") shall be converted into a stock
option to purchase shares of Class A Common Stock under the
Company's Stock Option Plans (the "Company Stock Option Plan")
prior to the Closing Date on the terms and conditions described
in Schedule 2.05(b) pursuant to the Reorganization (as
hereinafter defined).
(b) Each stock option (and any related alternative rights) to
purchase one share of Common Stock (the "Stock Options") granted
under the Company's Stock Option Plan (including those granted to
current or former employees, consultants and directors of the
Company or the VSP Reorganization Entities and including those
stock options granted pursuant to Section 1.09(a) above), which
Stock Options are outstanding at the Effective Time (whether or
not then presently exercisable), other than those that will
expire by their terms in connection with or as a result of the
Merger and those that are cancelled pursuant to Section 5.09(a)
in exchange for newly issued options to purchase shares of
Acquiror Common Stock pursuant to separate option exchange
agreements (as defined in Section 5.09(a)) entered into between
Acquiror and the holders of Stock Options, will be converted at
the Effective Time into an option to purchase an equal number of
shares of Acquiror Common Stock at a price per share equal to the
price per share of Class B Common Stock under each Stock Option
(the "Option Consideration"). The Company Stock Option Plan
shall terminate as of the Effective Time and thereafter the only
rights of participants therein shall be the right to receive the
consideration set forth in this Section 1.09. Prior to the
Effective Time, the Company shall use its reasonable efforts to
cause each holder of outstanding Stock Options to execute an
Option Exchange Agreement in form and substance acceptable to
Acquiror, and shall take such other action as may be necessary to
carry out the terms of this Section 1.09."
Amendment to Section 1.11(b) of the Agreement. Section 1.11(b)
of the Agreement is hereby amended and restated to read in its entirety:
"Section 1.11 Surrender of Common Stock and Stock Options.
(b) At the Closing, each holder of Stock Options other than
those cancelled pursuant to Section 5.09(a) shall deliver to
Merger Sub a stock option agreement or other agreement evidencing
the grant of Stock Options to the holder thereof (each an "Option
Agreement") which, at the Effective Time, represented all of such
holder's Stock Options, for
conversion and exchange into the Option Consideration pursuant to
this Section 1.11. At the Closing, Acquiror shall deliver, and
Acquiror and each holder of a Stock Option other than holders of
Stock Options cancelled pursuant to Section 5.09(a) shall enter
into, a stock option agreement, in form acceptable to Acquiror,
providing for the Option Consideration to be received by each
such optionholder (a "Replacement Option Agreement"). Following
the Effective Time and until the holder shall have executed and
delivered a Replacement Option Agreement and surrendered his or
her Stock Options as contemplated by this Section 1.11, each
holder of a Stock Option shall cease to possess any rights with
respect to such Stock Option, except the right to receive upon
such surrender and execution the Option Consideration as provided
herein and the provisions of Nevada Law."
Amendment to Section 1.13 of the Agreement. Section 1.13 of the
Agreement is hereby deleted.
Amendment to Section 2.05 of the Agreement. Section 2.05 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 2.05 Capitalization.
(a) The authorized capital stock of the Company consists of
80,000,000 shares of Preferred Stock, $0.01 per share (the
"Preferred Stock"), 100,000,000 shares of Class B Common Stock
and 20,000,000 shares of Class A Common Stock. The issued and
outstanding shares of Preferred Stock, Class A Common Stock and
Class B Common Stock (such issued shares are collectively
referred to herein as the "Capital Stock"), as of the date hereof
and as adjusted to give effect to the Reorganization (as
hereinafter defined), are as set forth on Schedule 2.05(a). All
of the shares of Capital Stock have been duly authorized and
validly issued and are fully paid and nonassessable. Except as
set forth in Schedule 2.05(b) hereto or as contemplated herein,
there are no subscriptions, options, warrants, conversion rights,
rights of exchange, or other rights, plans, agreements or
commitments of any nature whatsoever (including, without
limitation, conversion or preemptive rights) providing for the
purchase, issuance, transaction, registration or sale of any
shares of the Company's Capital Stock or any securities
convertible into or exchangeable for any shares of the Company's
Capital Stock (collectively, the "Company Derivative
Securities"). Without taking into account any effect of the
exchange of options pursuant to Section 5.09(a), none of the
Company Derivative Securities are entitled to be accelerated as a
result of the Merger. All of the Company Derivative Securities
have been issued, and all of the Company Derivative Securities to
be issued in the Reorganization will be issued, pursuant to valid
exemptions from registration under all Federal and state
securities laws, except where the failure to have such exemptions
would not have a Company Material Adverse Affect, and there are
no outstanding obligations of the Company to repurchase, redeem
or otherwise acquire
any of the Company Derivative Securities.
(b) The authorized and outstanding capital stock of each VSP
Entity, as of the date hereof and as adjusted to give effect to
the Reorganization (as hereinafter defined), is as set forth on
Schedule 2.05(c) hereto (such issued shares are collectively
referred to as the "VSP Entities' Capital Stock"). All such
shares of VSP Entities' Capital Stock have been duly authorized
and validly issued and are fully paid and nonassessable. Except
as set forth on Schedules 2.05(b) or 2.05(d) hereto or as
contemplated herein, there are no subscriptions, options,
warrants, concession rights, rights of exchange, or other rights,
plans, agreements or commitments of any nature whatsoever
(including, without limitation, conversion or preemptive rights)
providing for the purchase, issuance, transaction, registration
or sale of any shares of VSP Entities' Capital Stock or any
securities convertible into, or exchangeable for, any shares of
VSP Entities' Capital Stock (the "VSP Entity Derivative
Securities"). None of the VSP Entity Derivative Securities are
entitled to be accelerated as a result of the Merger. All of the
VSP Derivative Securities have been issued, and all of the VSP
Derivative Securities, if any, to be issued in the Reorganization
will be issued, pursuant to valid exemptions from registration
under all Federal and State securities laws, except where the
failure to have such exemption would not have a Company Material
Adverse Effect, and there are no outstanding obligations of any
of the VSP Entities or the Company to repurchase, redeem or
otherwise acquire any of the VSP Derivative Securities."
Amendment to Section 5.08 of the Agreement. Section 5.08 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 5.08 Reorganization. Prior to the Closing, Parent and the
Company will consummate, or cause to be consummated, the following
transactions:
(a) Each of Vivra Asthma Allergy Careamerica, Inc., Vivra ENT,
Inc., Vivra Health Advantage, Inc., Vivra Orthopaedics, Inc., and
Vivra OB-GYN Services, Inc. (collectively, the "VSP
Reorganization Entities") will be merged with and into the
Company, and, in connection therewith, each VSP Reorganization
Entity Option shall be converted into an option to purchase
shares of Common Stock under the Company Stock Option Plan as
reflected on Schedule 2.05(b) (the "VSP Reorganization Merger").
In connection therewith, the Company will use reasonable efforts
(without the requirement of paying any money or making any
financial concession) to cause each holder of VSP Reorganization
Entity Options to execute and deliver an option exchange
agreement, in form and substance satisfactory to the Company and
Acquiror, pursuant to which each holder of VSP Reorganization
Entity Options will agree, among other things, to the conversion
of his or her VSP Reorganization Entity Options into options to
acquire Common Stock pursuant to the Reorganization and, (i) to
cancel his or her options to acquire Common Stock in exchange for
newly issued options to acquire Acquiror Common Stock, (ii) to
enter into a stockholders' agreement, in form and substance
satisfactory to the Company and Acquiror, upon the exercise of
any options to acquire Acquiror Common Stock following the
Closing, and (iii) to terminate the existing stockholders
agreement relating to the shares of capital stock of the VSP
Reorganization Entity issuable upon the exercise of such holder's
VSP Reorganization Entity Options.
(b) Immediately prior to the Closing, Parent will convey,
transfer and assign to the Company all of the assets of Parent
listed on Schedule 5.08(b) and the Company will assume and agree
to perform all of the liabilities and obligations of Parent
listed on Schedule 5.08(b) hereto; provided, however, that with
respect to any leases listed on Schedule 5.08(b) hereto, the
Company will use reasonable efforts to obtain the consent of any
lessor to such leases prior to the Closing (the "Assignment" and
collectively with the VSP Reorganization Merger and the
conversion contemplated by Section 5.10, the "Reorganization")."
Amendment to Section 5.09 of the Agreement. Section 5.09 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 5.09 Certain Exchange Transactions.
(a) Prior to the Closing, Parent and the Company will use
reasonable efforts (without the requirement of paying any money
or making any financial concession) to cause each holder of
capital stock of the Company other than Parent and each holder of
Stock Options to enter into an agreement (each, an "Exchange
Agreement" or "Option Exchange Agreement," as applicable) with
Acquiror, (i) to exchange such shares of capital stock held by
such holder immediately prior to the Closing for an equal number
of shares of Acquiror Common Stock or to cancel such Stock
Options in exchange for options to purchase an equal number of
shares of Acquiror Common Stock, as applicable (such options to
have such exercise prices and voting terms as are agreed upon
between the Company and Acquiror), (ii) to terminate the
stockholders agreements, dated as of May 1, 1996, by and between
the Company and certain of its stockholders and optionholders,
and (iii) to enter into a new stockholders' agreement, in form
and substance satisfactory to Acquiror and the Company, relating
to such holder's shares of Acquiror Common Stock or the shares of
Acquiror Common Stock issuable upon such holder's exercise of
options, as applicable. The parties hereto agree and acknowledge
that Acquiror, the Company and Vivra may enter into separate
Option Exchange Agreements with certain members of management of
the Company pursuant to which (a) a portion of such persons'
existing Stock Options and Vivra Options may be cancelled in
advance of the Merger in exchange for new options to acquire
Company Common Stock (the "New Company Options") and (b) such New
Company Options will be cancelled simultaneously with the Merger
in exchange for options to acquire an equal number of shares of
Acquiror
Common Stock, in each case, on the terms and conditions agreed
upon between such members of management, the Company, Vivra and
Acquiror (the "Vivra Option Exchange").
(b) Prior to the Closing, Parent and the Company will use
reasonable efforts (without the requirement of paying any money
or making any financial concession) to cause each holder of
capital stock of Vivra Heart Services, Inc. ("VHS") other than
the Company and each holder of options to acquire VHS capital
stock ("VHS Options") to enter into an agreement with Acquiror,
(i) to exchange such shares of capital stock of VHS held by such
holders immediately prior to the Closing for a number of shares
of Acquiror Common Stock equal to the product of .405 multiplied
by the number of shares of capital stock of VHS held by each such
holder or to cancel such VHS Options in exchange for options to
purchase a number of shares of Acquiror Common Stock equal to the
product of .405 multiplied by the number of shares of capital
stock of VHS which could be purchased by such holder pursuant to
such holder's option, as applicable (such options to have such
exercise prices and voting terms as are agreed upon between the
Company and Acquiror), (ii) to terminate the stockholders
agreements, dated as of May 1, 1996, by and between VHS and
certain of its stockholders and optionholders, and (iii) to enter
into a new stockholders' agreement, in form and substance
satisfactory to Acquiror and the Company, relating to such
holder's shares of Acquiror Common Stock or the shares of
Acquiror Common Stock issuable upon such holder's exercise of
options, as applicable.
(c) Prior to the Closing, Parent and the Company will use
reasonable efforts (without the requirement of paying any money
or making any financial concession) to cause each holder of
capital stock of VHI other than the Company to enter into an
agreement with Acquiror II (i) to exchange such shares of capital
stock for an equal number of shares of capital stock of
Acquiror II, (ii) to cancel and terminate any stockholder
agreement to which such holder is a party relating to such shares
of VHI capital stock, and (iii) to enter into a new stockholders'
agreement, in form and substance satisfactory to Acquiror II and
the Company, relating to such holder's shares of capital stock of
Acquiror II."
Amendment to Section 5.13 of the Agreement. Section 5.13 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 5.13 Intercompany Transactions. Between the date hereof and
the Closing Date, Parent, on the one hand, and the Company and the VSP
Entities on the other hand, shall not engage in any transactions or
make any payments or advances to one another or enter into any
commitments to provide services or to transfer assets or liabilities
to or from one another, (i) except as contemplated by the
Reorganization, (ii) except as provided for in the Services
Agreement, dated as of the date hereof, between the Company and Parent
(the "Services Agreement"), a copy of which is attached hereto as
Exhibit 5.13 and (iii) except that, immediately prior to the Closing,
Parent shall
transfer to the Company $2,500,000.00 in cash."
Amendment to Section 8.08 of the Agreement. Section 8.08 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"Section 8.08 The Offer. Purchaser shall have advised Parent that,
subject to the satisfaction of the conditions to the Offer set forth in Annex A
to the Vivra Agreement, it will purchase the Parent Shares in the Offer or the
Purchaser or any other person or entity shall have acquired either (i) greater
than fifty percent (50%) of the outstanding capital stock of Parent or (ii) all
or substantially all of the assets of Parent, in either case by way of merger,
purchase of stock, purchase of assets or otherwise."
Addition of Section 8.09 to the Agreement. Section 8.09 of the
Agreement is hereby added to read as follows:
"Section 8.09 Non-Competition Agreement. The Company and the Parent
shall have entered into a non-competition agreement containing the
provisions set forth in Exhibit 7.06 hereto."
Amendment to Section 9.01. Section 9.01 of the Agreement is
hereby amended and restated to read in its entirety as follows:
"Section 9.01 Indemnification by Acquiror. The Acquiror, Acquiror II
and Merger Sub, shall, and, from and after the Effective Time, the
Surviving Corporation shall, indemnify, defend and hold harmless the
Parent and its successors, affiliates, stockholders, officers and
employees from and against any and all claims, demands, actions,
losses, damages, liabilities, costs and expenses (including reasonable
attorneys' fees and expenses) which arise out of or in connection with
the operation of the business of the Company and the VSP Entities,
including, without limitation, any liabilities of Parent and its
affiliates (other than the Company and the VSP Entities) arising out
of the provision of specialty physician network and disease management
services to managed care and provider organizations (other than such
businesses included within the Dialysis Business (as hereinafter
defined), including, without limitation all liabilities arising under
the agreements set forth on Schedule 9.01, other than those
liabilities and obligations that Parent has agreed to pay pursuant to
the Services Agreement (collectively, the "VSP Liabilities")."
Amendment to Section 9.02. Section 9.02 of the Agreement is
hereby amended and restated to read in its entirety as follows:
"Section 9.02 Indemnification by Parent. The Parent and its
successors shall indemnify, defend and hold harmless the Acquiror,
Acquiror II and Merger Sub, and from and after the Effective Time, the
Surviving Corporation, and their successors, affiliates, stockholders,
officers and employees from and against any and all claims, demands,
actions, losses, damages, liabilities, costs and expenses (including
reasonable attorneys' fees and expenses) which arise out of or in
connection with the operation of the business of the Parent (other
than the VSP Liabilities) and Vivra Renal Care, Inc. ("VRC") and the
Dialysis Subsidiaries (as
defined in the Vivra Agreement), including without limitation, any
liabilities of the Company and the VSP Entities arising out of the
provision of dialysis, renal care, nephrology, disease management, or
nephrologist practice management businesses or the business of
contracting with payors on behalf of nephrologists (the "Dialysis
Business")."
Closing Conditions. In consideration of the execution and
delivery of this Amendment and the certificates, opinions and other
documentation delivered by the parties to the Agreement concurrently herewith
pursuant to Articles VII and VIII of the Agreement, the parties hereto
acknowledge and agree that all conditions to their respective obligations to
close the Transactions have been satisfied.
Other Provisions Unchanged. Except as specifically amended and
restated by this Amendment, all of the terms and conditions of the Agreement
will continue in full force and effect.
Governing Law. This Amendment shall be governed by the laws of
the state of California, without regard to principles of conflicts or choice of
law.
Integration. This Amendment, together with the Agreement, sets
forth the entire understanding between and among the parties relating to the
subject matter contained herein and supersedes all prior discussions and
understandings between them.
Duplicate Originals. This Amendment may be executed in as many
duplicate originals as may be deemed necessary and convenient, each of which,
when so executed, shall be deemed an original but all such duplicate originals
shall constitute but one and the same instrument.
[remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed as of the date first above written.
VSP HOLDINGS, INC.
By:_________________________
Name:_______________________
Title:______________________
VSP HOLDINGS II, INC.
By:_________________________
Name:_______________________
Title:______________________
VSP ACQUISITION, INC.
By:_________________________
Name:_______________________
Title:______________________
VIVRA SPECIALTY PARTNERS, INC.
By:_________________________
Name:_______________________
Title:______________________
VIVRA INCORPORATED
By:_________________________
Name:_______________________
Title:______________________
