EXHIBIT 10.78
OPTION AGREEMENT FOR THE PURCHASE AND SALE OF BUSINESSES
This OPTION AGREEMENT FOR THE PURCHASE AND SALE OF BUSINESSES (this
"AGREEMENT"), dated as of June 1, 1997, is entered into by and among Castle
Dental Centers of Texas, Inc., a Texas corporation ("CDC TEXAS"), Castle Dental
Centers, Inc., a Delaware corporation ("CASTLE"), Xxxx X. Xxxxxx, D.D.S., P.C.,
a Texas professional corporation ("CASTLE PC"), SW Dental Associates, LC, a
Texas limited liability company ("SW DENTAL"), Xxxx Xxxxxxx,D.D.S. ("XXXXXXX")
and Xxxxxx Xxxxxxx, Xx. ("XXXXXXX").
W I T N E S S E T H:
WHEREAS, SW Dental and CDC Texas each wish to grant the other an option to
enter into and consummate the transactions contemplated by the Member Interests
Purchase Agreement substantially in the form of EXHIBIT A hereto (the "Purchase
Agreement");
WHEREAS, CDC Texas wishes to grant, and SW Dental wishes to acquire, an
option for SW Dental to enter into and consummate the transactions contemplated
by an Asset Purchase Agreement substantially in the form of EXHIBIT B hereto
(the "HORIZON AGREEMENT"), which agreement contemplates the purchase by SW
Dental of substantially all of the assets of CDC Texas located in Xxxxxx County,
Texas, and all counties contiguous thereto (the "TERRITORY"); and
WHEREAS, in connection with the grant of such options the parties are,
contemporaneously herewith, entering into a Management Services Agreement to
facilitate the transition of business operations in the event that any of the
options contemplated herein is exercised;
NOW, THEREFORE, in consideration for the mutual covenants and other
consideration described herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
covenant and agree as follows:
ARTICLE I
OPTIONS TO PURCHASE AND SELL BUSINESSES
1.1 CERTAIN DEFINITIONS. As used herein, the following terms shall have
the following meanings ascribed to them:
"EQUITY SECURITIES" shall mean any securities of Castle,
including, without limiting the
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generality of the foregoing, any common or preferred stock,
securities convertible into or exchangeable for such common or
preferred stock and any warrants, options, rights, or any
instruments (including debt instruments or preferred stock)
convertible into or exchangeable for such common stock or
preferred stock of Castle.
"NET CASH PROCEEDS" shall mean the amount obtained by
subtracting (i) the sum of the legal fees of Castle, printing
costs, filing fees paid to any governmental authority
(including blue sky fees), accountant's fees and fees and
allowances paid to any investment banker, broker, underwriter
or finder attributable to sale(s) of Equity Securities after
the date hereof, from (ii) the total gross proceeds received
by Castle from such sale(s) of Equity Securities.
"ROUND ROCK LEASE" means the lease dated as of August 1, 1997,
between Castle Dental Centers of Texas, Inc., as lessee, and
Socrates Retail Joint Venture, as lessor, covering the
premises known as Xxx 0X, Xxxxx 0, replat of Xxx 0, Xxxxx 0,
Xxxxxxxx Xxxxxxxx, Xxxxx XX.
"TELECOMMUNICATIONS RIGHTS" shall mean telephone numbers, fax
numbers and e-mail addresses pertaining to the location
covered by the Round Rock Lease.
1.2 GRANT OF OPTIONS. (a) Subject to the terms and conditions of this
Agreement, (i) CDC Texas shall have an exclusive non-transferable option (the
"CDC OPTION"), but not the obligation, to purchase from Xxxxxxx and Xxxxxxx all
of the outstanding limited liability company interests in and capital stock of
SW Dental, and (ii) upon the exercise of such option by CDC Texas, Xxxxxxx and
Xxxxxxx shall be obligated to sell such interests to CDC Texas, such purchase
and sale to be on the terms and conditions set forth in the Purchase Agreement.
During the CDC Purchase Option Term (as such term is defined below), any
certificates representing interests in, or capital stock of, SW Dental shall
contain a legend referring to this Agreement.
(b) Subject to the terms and conditions of this Agreement, SW Dental shall
have an exclusive non-transferable option (the "HORIZON OPTION"), but not the
obligation, to purchase from CDC Texas all of the assets of CDC Texas related to
the conduct of business in the Territory, all as set forth in the Horizon
Agreement, and upon the exercise of such option by SW Dental, CDC Texas shall be
obligated to sell such business and assets to SW Dental, such purchase and sale
to be on the terms and conditions further set forth in the Horizon Agreement.
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(c) During the period commencing three days after the sale for cash by
Castle, whether in one or more private placements or in a public offering, of
any Equity Securities from which Castle receives aggregate Net Cash Proceeds
(including and combined with any other Net Cash Proceeds received after the date
hereof) in excess of $15,000,000, and ending 10 days after such aggregate Net
Cash Proceeds are received, CDC Texas shall exercise the CDC Option and effect
the purchases contemplated in the Purchase Agreement, subject only to the
conditions (if any) set forth in the Purchase Agreement, and the foregoing
promise of CDC Texas shall be subject to enforcement by court ordered specific
performance.
1.3 OPTION TERMS. (a) CDC Texas may exercise the CDC Option during the
period commencing on the date hereof and ending on the earlier of (i) the first
anniversary of the date hereof, and (ii) ten days after the sale for cash by
Castle, whether in a private placement or in a public offering, of any Equity
Securities from which Castle receives Net Cash Proceeds (including and combined
with any other Net Cash Proceeds received after the date hereof) in excess of
$15,000,000. The period during which such option may be exercised by CDC Texas
is referred to herein as the "CDC PURCHASE OPTION TERM." Upon exercise of the
CDC Option, the Horizon Option shall terminate.
(b) SW Dental may exercise the Horizon Option for a period of 60 days,
commencing on the first to occur of (1) the date the CDC Option expires by its
terms or is canceled or terminated by CDC Texas, (2) the date the Management
Services Agreement, dated as of even date herewith (the "MANAGEMENT SERVICES
AGREEMENT"), between CDC Texas and SW Dental, is terminated by CDC Texas. The
period during which such option may be exercised by SW Dental is referred to
herein as the "HORIZON PURCHASE OPTION TERM".
1.4 CONSIDERATION FOR THE OPTIONS. (a) In consideration of the grant by
Xxxxxxx to CDC Texas of the CDC Option, CDC Texas shall (i) pay, immediately
upon the execution hereof, to Xxxxxxx $1,000,000 (the "NON-REFUNDABLE PAYMENT"),
(ii) pay to SW Dental, upon the exercise of the CDC Option at the closing of the
transactions contemplated in the Purchase Agreement, (A) if the CDC Option is
exercised more than 180 days but less than 270 days after the date hereof, an
amount equal to $170,000, (b) if the CDC Option is exercised at least 270 days
but less than 300 days after the date hereof, an amount equal to $255,000, and
(C) if the CDC Option is exercised at least 300 days after the date hereof but
on or before the one year anniversary of the date hereof, an amount equal to
$340,000.
(b) In the event that CDC Texas does not exercise the CDC Option and
effect the purchase contemplated by the Purchase Agreement and the CDC Option
expires by its terms, then (i) the Non-Refundable Payment shall be and remain
the sole property of Xxxxxxx, (ii) no payments, other than the Non-Refundable
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Payment as contemplated in Section 1.4(a) hereof, shall be paid and delivered to
SW Dental, and (iii) CDC Texas shall, in lieu of the payments (other than the
Non-Refundable Payment) contemplated in Section 1.4(a), (A) assign and transfer
to SW Dental the Round Rock Lease (in the event that SW Dental is not a party to
the Round Rock Lease as lessee thereunder) and the equipment, fixtures, patient
records, computer software, customer lists, Telecommunications Rights, employee
information and all other property or things of value located at the premises
covered by the Round Rock Lease, and (B) permit (and shall not interfere with,
prohibit or restrict) any offer to employ or the hiring by SW Dental of any or
all employees (including administrative staff as well as dental technicians and
dentists) of CDC Texas employed at the location covered by the Round Rock Lease,
and from and after the date of such assignments and transfers, all property and
assets, real or personal, tangible or intangible, shall be the sole property and
assets of SW Dental, and CDC Texas shall execute such bills of sale and
assignments as SW Dental shall reasonably request to further evidence the
foregoing.
(c) The Non-Refundable Payment is and shall hereafter be the sole and
exclusive property of Xxxxxxx. Notwithstanding anything contained in this
Agreement or in any other agreement to which Xxxxxxx and any person party hereto
are a party, the Non-Refundable Payment is not refundable to any person, for any
reason or circumstance, including without limitation by reason of (i) any events
or conditions that prevent, prohibit, limit or adversely affect in any way the
exercise by CDC Texas of the CDC Option, (ii) the acts of any governmental
authority to enjoin or limit the exercise of the CDC Option, (iii) any changes
in (A) general economic or local business conditions, or (B) any federal, state
or local laws, rules or regulations, that adversely affect the CDC Option or the
potential profitability of the dental care business, (iv) the breach of any
covenant, by SW Dental or Xxxxxxx, set forth in any written agreement with CDC
Texas or any affiliate thereof, or (v) any representation or warranty of Xxxxxxx
or SW Dental set forth in any written agreement thereof with CDC Texas or any
affiliate thereof, is untrue or incorrect in any respect, whether or not
material. It is the intention of the parties hereto that the Non-Refundable
Payment is permanently and irrevocably transferred by CDC Texas and its
affiliates to Xxxxxxx without any recourse against the Non-Refundable Payment,
and without rights to rescind or recapture the Non-Refundable Payment, by action
in quantum meruit, at common law, in equity or otherwise.
(d) SW Dental has executed the Management Services Agreement in
consideration of the valuable services to be provided thereunder and of the
granting by SW Dental to CDC Texas of the CDC Option.
(e) All payments by any party hereto to any other party hereto pursuant to
this Section 1.4 shall be made by wire transfer of immediately available funds.
1.5 REIMBURSEMENT OF EXPENSES BY CDC TEXAS. CDC Texas acknowledges that SW
Dental has incurred, prior to the date hereof, certain expenses on behalf of CDC
Texas in connection with certain services provided by SW Dental for CDC Texas in
the Territory. A schedule of such expenses is set forth on EXHIBIT C hereto. CDC
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Texas has reimbursed to SW Dental the total of such expenses in cash on the date
hereof by wire transfer of immediately available funds to an account or accounts
previously identified by SW Dental.
ARTICLE II
EXERCISE OF PURCHASE OPTIONS
2.1 NOTICE OF EXERCISE OF OPTION BY CDC TEXAS. CDC Texas may give notice
in writing (the "CDC PURCHASE NOTICE") to Xxxxxxx at any time during the CDC
Purchase Option Term of CDC Texas' intent to exercise the CDC Option. Closing of
the transactions contemplated by the Purchase Agreement (the "Closing") shall be
held within ten days after Xxxxxxx'x receipt of the CDC Purchase Notice.
2.2 NOTICE OF EXERCISE OF OPTION BY SW DENTAL. SW Dental may give notice
in writing (the "SW PURCHASE NOTICE") to CDC Texas at any time during the
Horizon Purchase Option Term of SW Dental's intent to exercise the Horizon
Option. Closing of the transactions contemplated by the Purchase Agreement shall
be held within ten days after CDC Texas' receipt of the SW Purchase Notice.
ARTICLE III
HORIZON PURCHASE OPTION MATTERS
3.1 NOTICE OF CHANGES TO SCHEDULES. CDC Texas shall, promptly upon
becoming aware that any representation or warranty of CDC Texas in the Horizon
Agreement is not complete or accurate in any material respect, or that it will
be unable to comply in any material respect with any covenant or agreement in
the Horizon Agreement due to changed circumstances, inform SW Dental in writing
(a "HORIZON CHANGE NOTICE"). Each such Horizon Change Notice shall set forth a
description of such change or such inaccurate representation or warranty or
inability to perform such covenant or agreement.
3.2 NOTICE OF EXERCISE OF HORIZON OPTION. SW Dental may give notice in
writing (the "HORIZON NOTICE") to CDC Texas at any time during the Horizon
Purchase Option Term of SW Dental's intent to exercise the Horizon Option.
Closing of the transactions contemplated by the Horizon Agreement (the "HORIZON
CLOSING") shall be held within 30 days after CDC Texas' receipt of the Horizon
Notice, PROVIDED, that SW Dental may decline to close the transactions
contemplated in the Horizon Agreement, whether because of Horizon Change Notices
or for any other reason, it being agreed hereby that the Horizon Option is an
option of SW Dental, and not an obligation.
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3.3 NONCOMPETITION AND OTHER PROVISIONS VOID. SW Dental and CDC Texas
acknowledge and agree that, if the CDC Option remains unexercised at the end of
the CDC Purchase Option Term, neither SW Dental, Xxxx Xxxxxxx, D.D.S., nor
Xxxxxx Xxxxxxx shall be subject to any further employment, noncompetition,
confidentiality, secrecy, hiring limitation or nonsolicitation obligations, or
any other contractual limitations, with respect to CDC Texas or any of CDC
Texas' affiliates, and the Management Services Agreement entered into
contemporaneously herewith shall be terminated, void and without further force
or effect at such time.
3.4 RETENTION OF EMPLOYEES. If SW Dental exercises the Horizon Option, SW
Dental shall be entitled to offer employment to and to employ any and all CDC
Texas employees then employed by CDC Texas in the Territory who are not licensed
dentists, and CDC Texas shall use reasonable efforts to obtain consents to the
assignment to SW Dental of all of CDC Texas' employment contracts with licensed
dentists working in the Territory.
ARTICLE IV
CONDUCT OF BUSINESS
4.1 CONDUCT OF THE BUSINESS OF SW DENTAL DURING THE PURCHASE OPTION TERMS.
SW Dental and Xxxxxxx hereby covenant that, from the date hereof to and
including the earlier of (i) the expiration of the CDC Purchase Option Term and
the Horizon Purchase Option Term or (ii) the closing of the transactions
contemplated by the Purchase Agreement, except as contemplated by the Management
Services Agreement or otherwise agreed to in writing by CDC Texas:
(a) the business of SW Dental shall be conducted and the assets
used in the business of SW Dental shall be repaired and
maintained in the ordinary and usual course, in a manner
consistent with past practice;
(b) except in the ordinary course of business consistent with past
practice, SW Dental shall not (i) make any commitment to make
any capital expenditures individually in excess of $75,000 or
in the aggregate in excess of $350,000; (ii) dispose of any
capital assets with a book value, individually or in the
aggregate, in excess of $10,000 or encumber any of its capital
assets or other assets; (iii) incur, or guarantee or otherwise
become liable for, any indebtedness for borrowed money, except
as may be required in connection with the Round Rock Lease;
(iv) amend any of its material contracts; (v) enter into any
new employee benefit plan, program or arrangement or amend any
existing employee benefit plan, program or arrangement; or
(vi) issue any additional equity
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securities or transfer any equity securities of SW Dental,
except for transfers to Xxxxxxx from Xxxxxx Xxxxxxx, Xx.;
(c) SW Dental shall use its best efforts to preserve for CDC Texas
the goodwill of all persons dealing with SW Dental;
(d) on receipt of the CDC Purchase Notice, SW Dental and Xxxxxxx
shall cooperate fully with CDC Texas to consummate the closing
of the transactions contemplated in the Purchase Agreement in
an orderly fashion;
(e) SW Dental shall promptly notify CDC Texas of (i) any breach or
violation of, default or event of default under, or actual or
threatened termination or cancellation of any material
contract or other material instrument relating to the business
of SW Dental, (ii) any material loss of, damage to, or
disposition of any of the assets of SW Dental (other than the
sale or use of inventories in the ordinary course of
business), and (iii) any claim or litigation, threatened or
instituted, or any other material adverse event or occurrence
involving or affecting the business of SW Dental; and
(f) SW Dental and Xxxxxxx shall not sell, dispose of, distribute,
encumber or enter into any agreement or commitment, whether
oral or written for the sale, disposition, distribution or
encumbrance of any portion of the business of SW Dental (other
than (i) the sale or use of inventories in the ordinary course
of business, (ii) the transfer of interests in SW Dental to
Xxxxxxx from Xxxxxx Xxxxxxx, Xx., and (iii) encumbrances
created in connection with debt incurred to finance leasehold
improvements and purchases of equipment for the Round Rock
Lease) or initiate or participate, through agents,
representatives or otherwise, in any discussions or
negotiations with, or otherwise solicit from, any corporation,
business or person any proposals or offers relating to the
disposition of any such portion of the business of SW Dental,
PROVIDED, that SW Dental and Xxxxxxx may, within 90 days prior
to the expiration of the CDC Option, engage in discussions
with financial institutions or investors in anticipation of
the exercise of the Horizon Option.
4.2 CONDUCT OF THE BUSINESS OF CDC TEXAS THROUGH THE HORIZON PURCHASE
OPTION TERM. CDC Texas and Castle hereby covenant that, from the date hereof to
and including the earlier of (i) the expiration of the Horizon Purchase Option
Term or (ii) the closing of the transaction contemplated by the Horizon
Agreement, except as agreed to in writing by SW Dental:
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(a) the business of CDC Texas in the Territory shall be conducted
and the assets used in the business of CDC Texas in the
Territory shall be repaired and maintained in the ordinary and
usual course, in a manner consistent with past practice;
(b) except in the ordinary course of business consistent with past
practice, CDC Texas shall not, with respect to its business in
the Territory, (i) make any commitment to make any capital
expenditures individually in excess of $75,000 or in the
aggregate in excess of 350,000; (ii) dispose of any capital
assets with a book value, individually or in the aggregate, in
excess of $10,000 or encumber any of its capital assets or
other assets; (iii) incur, or guarantee or otherwise become
liable for, any indebtedness for borrowed money; (iv) amend
any of its material contracts; (v) enter into any new employee
benefit plan, program or arrangement or amend any existing
employee benefit plan, program or arrangement or grant any
increases in employee compensation; or (vi) issue any
additional equity securities or transfer any equity securities
of CDC Texas;
(c) CDC Texas shall use its best efforts to preserve for SW Dental
the goodwill of all persons dealing with CDC Texas in the
Territory;
(d) on receipt of the SW Purchase Notice, CDC Texas and Castle
shall cooperate fully with SW Dental to consummate the
exercise of the Horizon Agreement in an orderly fashion;
(e) CDC Texas shall promptly notify SW Dental of (i) any breach or
violation of, default or event of default under, or actual or
threatened termination or cancellation of any material
contract or other material instrument relating to the business
of CDC Texas in the Territory, (ii) any material loss of,
damage to, or disposition of any of the assets of CDC Texas in
the Territory (other than the sale or use of inventories in
the ordinary course of business), and (iii) any claim or
litigation, threatened or instituted, or any other material
adverse event or occurrence involving or affecting the
business of CDC Texas in the Territory;
(f) CDC Texas and Castle shall not sell, dispose of, distribute,
encumber or enter into any agreement or commitment, whether
oral or written for the sale, disposition, distribution or
encumbrance of any portion of the business of CDC Texas in the
Territory (other than the sale or use of inventories in the
ordinary course of business) or initiate or participate,
through agents, representatives or otherwise, in any
discussions or negotiations
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with, or otherwise solicit from, any corporation, business or
person any proposals or offers relating to the disposition of
any such portion of the business of CDC Texas in the
Territory.
ARTICLE V
COVENANTS
5.1 CLOSE SW DENTAL FIRST. Until such time as (i) CDC Texas exercises the
CDC Option and closes the transactions contemplated in the Purchase agreement,
or (ii) CDC Texas and Xxxxxxx agree in writing to release, extinguish and
terminate the CDC Option, CDC Texas shall not, nor shall it permit its
affiliates Castle or Castle PC to, purchase or acquire for cash, all or
substantially all of the assets or business of any dentist, dental office, oral
or dental surgery center, or multi-site dental or oral care practice
organization; PROVIDED, HOWEVER, that this Section 5.1 shall not prohibit the
construction or lease by CDC Texas of additional dental offices in the Houston,
Texas, area.
5.2 RISK ALLOCATION. CDC Texas shall purchase insurance as CDC Texas may
desire to cover such risks of ownership of SW Dental as CDC Texas may incur in
connection with the ownership thereof after the date hereof arising as a result
of the acquisition of Xxxxxxx'x capital stock and member interests in CDC Texas.
CDC Texas has agreed under the Purchase Agreement, subject to compliance by SW
Dental with the covenants contained herein, (i) to succeed to the ownership of
SW Dental, and CDC Texas acknowledges the risks inherent therein and the need
for adequate insurance of loss on account of torts, malpractice, workmen's
compensation claims, property damage and other risks of operation of a dental
practice, whether or not similar to any of the foregoing, (ii) that the risks
arising from changes, occurring between the date hereof and the closing date
under the Purchase Agreement, in the business, financial condition,
profitability, prospects, legal and regulatory matters and limitations, asset
condition, and all other risks associated with adverse changes after the date
hereof in the business, financial condition or results of operations of SW
Dental, are risks that have been assumed by CDC Texas as part of the bargain of
the parties hereto, (iii) that CDC Texas has made its decision to purchase the
stock and interests in SW Dental from Xxxxxxx based on the representations and
warranties set forth as of the date hereof in the Purchase Agreement (with no
requirement for updates for changes in the relevant facts), and CDC Texas and
its affiliates have agreed to purchase such stock and interests subject only to
the conditions set forth herein, the effect of which is that (A) SW Dental and
its affiliates thereby assume the risk that the business of SW Dental may change
materially and adversely between the date of execution hereof and the date that
CDC Texas purchases such stock and interests pursuant to the Purchase Agreement,
and (B) the representations and warranties of SW Dental, being limited to the
date hereof, may not be true and correct on a subsequent date, but such changes
shall not entitle CDC Texas to refuse to close
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the transactions contemplated by the Purchase Agreement, and (iv) CDC Texas has
agreed hereby, subject only to (A) its ability to raise sufficient funds to pay
the purchase price under the Purchase Agreement, and (B) the conditions (if any)
set forth in the Purchase Agreement, to purchase the outstanding capital stock
and member interests in SW Dental without regard to changes that occur in the
business, financial condition, prospects, results of operations, profitability,
legal or regulatory matters, assets or any other matters pertaining to or
affecting the business of SW Dental between the date hereof and the closing date
under the Purchase Agreement.
5.3 ROUND ROCK LEASE BUILDOUT. SW Dental is expressly permitted hereunder
to incur expenses and indebtedness which have been mutually agreed to by SW
Dental and CDC Texas in order to build out and complete dental care facilities,
including the construction of leasehold improvements, the purchase of needed
office and dental care equipment, and the incurring of marketing and promotional
expenses associated with the opening of a new dental practice office, at the
location that is the subject of the Round Rock Lease. The leasehold
improvements, and all equipment and other property, at the Round Rock Lease
location shall be owned by SW Dental.
ARTICLE VI
MISCELLANEOUS
6.1 CONSENT TO REFERENCES IN REGISTRATION STATEMENT. SW Dental hereby
irrevocably (i) consents to the references that may be made to it and its
business, and the inclusion of the financial statements of SW Dental, in any
Registration Statement filed by Castle under the Securities Act or offering
memorandum relating to the Common Stock of Castle; and (ii) waives any breach of
any confidentiality agreement to which SW Dental has entered into with CDC Texas
or Castle which may be occasioned by such inclusion.
6.2 ENTIRE AGREEMENT. This Agreement (including the Exhibits) and the
Management Services Agreement set forth the entire understanding of the parties
with respect to the subject matter hereof. Any previous agreements or
understandings (whether oral or written) between the parties regarding the
subject matter hereof, including that certain letter agreement dated September
11, 1996 (the "SEPTEMBER LETTER"), are merged into and superseded by this
Agreement. There are no unwritten or oral agreements among the parties hereto.
Pursuant to the September Letter, CDC Texas paid to SW Dental $500,000, and (i)
such payment constitutes a nonrefundable part (which does not reduce and is not
a credit against any amounts payable hereunder or in connection with the
exercise of the Purchase Agreement) of the consideration to be paid to Xxxxxxx
in connection with the expected exercise by CDC Texas of the CDC Option, (ii)
this Agreement constitutes a restructure of the various terms contemplated by
the September Letter, and (iii) the Non-Refundable Payment is in addition to,
and does not reduce, and is not a credit against, the cash payment to be made by
CDC
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Texas to Xxxxxxx pursuant to the Purchase Agreement at the closing contemplated
therein.
6.3 SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors of
the parties hereto; provided that this Agreement may not be assigned by SW
Dental without the prior written consent of CDC Texas, or by CDC Texas without
the prior written consent of SW Dental.
6.4 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall constitute the same instrument.
6.5 HEADINGS. The headings, subheadings and captions of the Articles,
Sections and paragraphs of this Agreement are inserted for convenience only and
shall not be deemed to constitute part of this Agreement or to affect the
construction hereof.
6.6 MODIFICATION AND WAIVER. No amendment, modification or alteration of
the terms or provisions of this Agreement shall be binding unless the same shall
be in writing and duly executed by the parties hereto, except that any of the
terms or provisions of this Agreement may be waived in writing at any time by
the party which is entitled to the benefits of such waived terms or provisions.
No waiver of any of the provisions of this Agreement shall be deemed to or shall
constitute a waiver of any other provision hereof (whether or not similar). No
delay on the part of either party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof.
6.7 NO THIRD PARTY BENEFICIARY RIGHTS. This Agreement is not intended to
and shall not be construed to give any person (other than the parties signatory
hereto) any interest or rights (including, without limitation, any third party
beneficiary rights) with respect to or in connection with any agreement or
provision contained herein or contemplated hereby.
6.8 EXPENSES. Except as otherwise provided in that certain letter
agreement, dated December 26, 1996, between SW Dental and CDC Texas, and except
as expressly provided in this Section 6.8, the parties hereto shall each pay all
costs and expenses incurred by them or on their behalf in connection with this
Agreement and the transactions contemplated hereby. Within 30 days after the
execution hereof, CDC Texas shall pay to Fulbright & Xxxxxxxx L.L.P. all fees
incurred by SW Dental or Xxxxxxx in connection with the execution and delivery
of this Agreement and the Management Services Agreement.
6.9 NOTICE. Any notice, request, instruction or other document to be given
hereunder by any party hereto to any other party shall be sufficiently given if
delivered in person or sent by telecopier or registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
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if to CDC Texas, Castle or Castle PC, to:
Castle Dental Centers of Texas, Inc.
0000 Xxxx Xxx Xxxxxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
with a copy to:
Xx. Xxxxxxx X. Xxxxxxxxx
Bracewell & Xxxxxxxxx, L.L.P.
South Tower Pennzoil Place
000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
if to SW Dental or Xxxxxxx, to:
Southwest Dental Associates, L.C.
000 Xxxxxxxxx Xxxx
Xxxxxx, Xxxxx 00000
Attn.: Xxxx Xxxxxxx, D.D.S.
with a copy to:
Xx. Xxxxx X. Xxxxxx
Fulbright & Xxxxxxxx L.L.P.
0000 XxXxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
or at such other address for a party as shall be specified by like notice, and
such notice or communication shall be deemed to have been duly given as of the
date so delivered, mailed or sent by telecopier.
6.10 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas without regards to conflict of
law rules thereof.
6.11 CONFIDENTIALITY; PUBLICITY. The terms and conditions of this
Agreement shall not be disclosed by any party hereto without the prior written
consent of the other parties; provided, however, that CDC Texas and SW Dental
may disclose such information as is required to comply with the requirements of
their respective lenders and investors and to comply with applicable securities
laws. No party hereto shall issue any press release or make any other public
statement, in each case relating to or connected with or arising out of this
Agreement or the matters contained herein,
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without obtaining the prior approval of the other parties hereto to the contents
and the manner of presentation and publication thereof.
6.12 CONSENT TO JURISDICTION. Any judicial proceeding brought against any
of the parties to this Agreement on any dispute arising out of this Agreement or
any matter related hereto shall be brought in any federal or state court located
in Xxxxxx County, Texas, and, by execution and delivery of this Agreement, each
of the parties to this Agreement accepts for itself the exclusive jurisdiction
of the aforesaid courts, and irrevocably agrees to be bound by any judgment
rendered thereby in connection with this Agreement.
6.13 SEVERABILITY. If any provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law or public policy, all other
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party. Upon such
determination that any provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that the transactions contemplated
hereby are fulfilled.
6.14 ENFORCEMENT. The parties hereto agree that the remedy at law for any
breach of this Agreement is inadequate and that should any dispute arise
concerning the grant or exercise of the Option or any other matter hereunder,
this Agreement shall be enforceable in a court of equity by an injunction or a
decree of specific performance. Such remedies shall, however, be cumulative and
nonexclusive, and shall be in addition to any other remedies which the parties
hereto may have.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed on its behalf as of the date first above written.
CASTLE DENTAL CENTERS OF TEXAS, INC.
By: _________________________
Name: Xxxx X. Xxxxxx, Xx.
Title: President
13
CASTLE DENTAL CENTERS, INC.
By: _________________________
Name: Xxxx X. Xxxxxx, Xx.
Title: President
XXXX X. XXXXXX, D.D.S., P.C.
By: _________________________
Name: Xxxx X. Xxxxxx, Xx.
Title: President
SW DENTAL ASSOCIATES, LC
By: _________________________
Name: Xxxx Xxxxxxx, D.D.S.
Title: President
_____________________________
Xxxx Xxxxxxx, D.D.S.
_____________________________
Xxxxxx Xxxxxxx, Xx.
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